First Green Deal Plans Ready To Approve

11 April 2013

The Green Deal Finance Company has announced that a pecuniary agreement is now in place with lenders, effectively opening the door for the first Green Deal Plans to be approved.

"I am delighted to confirm the completion of the £244m financing package with our principal stakeholders, DECC and the UK Green Investment Bank,” said Mark Bayley, Chief Executive of the Green Deal Finance Company.

“We can now offer Green Deal Providers a one-stop-shop to set-up, finance and administer Green Deal Plans.

“This package will provide very long-term and low-cost funding to enable householders across all parts of the country to finance energy efficiency improvements to their homes.”

About the Scheme

After an initial launch date of 1st October 2012 was delayed due to technical issues, the Green Deal officially launched on 28th January.

Under the scheme, homeowners, landlords and tenants can apply for financial assistance to make energy-saving home improvements to their property. All upfront costs are covered by a loan, which the householder repays from charges on their electricity bill.

The scheme’s ‘Golden Rule’ states that the sum repaid must not exceed the sum that will be saved by making the improvements in the first place.

45 home improvement measures are authorised under the scheme, including Cavity Wall Insulation, Loft Insulation, Boiler Replacement, and Double Glazing

How it Works

In order to become eligible for funding under the scheme, householders must first have their property evaluated by an approved Green Deal Assessor.

The Government recently reported that the number of Green Deal Assessments lodged has now risen to 9,268. More than 7,000 of these were lodged during the month of March, representing an increase of more than 300% over the previous month.

“Many of these assessments can be expected to convert into Green Deal Plans as householders install the measures into their homes," said Bayley.

After assessment, a plan must be put into place, detailing the length of the loan (up to 25 years) and the work that is to be carried out. For example, if an assessor determines that Cavity Wall Insulation would be beneficial, this will be written into the plan. Once the plan has been agreed, the Green Deal Provider will arrange for the home improvements to be made.

With no financial agreement in place, Providers were unable to advance to the plan stage. Now that can change.

Bayley is confident that the scheme offers excellent value to consumers.

"By ensuring that householders can only borrow what they can expect to save in energy bills, and by offering a fixed rate for 10 to 25 years, Green Deal Plans will be affordable and widely available to over 80% of the population. No other consumer credit product offers a fixed rate for up to 25 years and is this inclusive."

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