When the Government announced the Green Deal scheme back in 2012, it was anticipated as the next best thing to greatly improve energy efficiency in the UK. It hasn’t quite had the desired effect though and although some homeowners have taken advantage of Government loans, it has yet to hit the expected levels of success.

The Green Deal officially launched in June 2014 and is designed to encourage more homeowners, landlords and tenants to take up green measures.

What is the Green Deal?

The Green Deal provides an opportunity to improve the energy efficiency of your home without the need to pay upfront. Rather than forking out a lump sum, repayments are made with the money saved on bills over a set period of time. The Green Deal’s Golden Rule states that you shouldn’t pay back more than you save monthly.

There are plenty of home improvements included in the Green Deal, from insulation and replacement boilers to renewable energy technologies.

The scheme is essentially a loan. You need to choose an approved Green Deal installer to fit the energy efficiency upgrades, with a maximum spend of £6,500 per household. This loan is then repaid between 1 and 25 years. Green Deal loans are available to everyone too and not subject to your income.

The loan itself isn’t tied to you either. Instead, it remains with the property. So if you decide to sell your home in the future, the new occupants will take up responsibility of paying the loan.

How does the Green Deal work?

There are three steps to follow if you’re interested in the Green Deal.

Step 1. Choose your energy efficiency improvements

First thing’s first, you’ll need to decide what home improvements to have completed. There are plenty to pick from and you’ll need an approved Green Deal assessor to visit your home and determine what’s necessary. You’re not limited to the number of improvements you can make, but there’s a maximum spend of £6,500. Home improvements include loft insulation, double glazing and a replacement boiler.

Step 2. Compare Green Deal quotes

Once the assessor has visited your home, they’ll provide you with a document highlighting the energy efficiency areas that need addressing. It’s now time to call up a few Green Deal providers and compare quotes to get the best price. Whilst you won’t be paying upfront, the more you spend, the longer the repayment period will be.

Step 3. Choose your Green Deal Provider

You shouldn’t find it too tricky contacting a few different providers and receiving quotations for the work you want. Simply choose the right provider and proceed with having the energy efficiency measures implemented. It couldn’t be easier than that.

With Green Deal home improvements you can reduce bills by hundreds of pounds on a monthly basis. Once you have repaid the Government loan, these savings will go straight into your bank account.

What energy efficiency improvements are covered?

There are loads of improvements available under the Green Deal scheme. Amongst others, these include:

  • Condensing boilers
  • Underfloor heating
  • Cavity wall insulation
  • Draught proofing
  • Floor insulation
  • Pipe and cylinder insulation
  • Loft insulation
  • Biomass boilers/wood-burning stoves
  • Ground, water and air source heat pumps
  • Solar panels
  • Double glazing
  • Light fittings.

Remember, if you want to make use of the Green Deal, only companies registered with the Department of Energy and Climate Change (DECC) and approved as Green Deal assessors, providers or installers can fit the above. Of course, if you wish to invest your own money, you’re free to choose any company.

In total there are some 500 organisations registered under the Green Deal, so you’re spoilt for choice. These are split into independent local companies and larger national suppliers including British Gas, Npower and The Big Green Energy Company.

What happens when I move house?

Green Deal loans are tied to your property, rather than being a personal loan. So, when you sell your house in the future, the loan stays with the property. The next occupier must continue making payments.

Of course, this has it’s fair share of sceptics, as people believe it’ll be more difficult to sell-up when there’s a loan attached to the property. However, as the Government point out, energy bills won’t be as expensive and the new owners won’t be losing out.

As the loan is attached to your energy bills, defaulting payments can result in you being disconnected from the grid. This is a last resort though and energy companies will work with struggling households to help make bills more affordable.