Richard Laverick, Director of Corporate Sustainability at ADAS, the UK’s largest environmental consultancy, looks at the Green Deal and what it will mean for local authorities.
The Green Deal has continued to make headlines in recent months as the Coalition Government’s new and radical way of making energy efficient homes available for all. A recent announcement from DECC Minister Greg Barker has indicated that the Green Deal is expected to obtain Royal Assent in autumn 2011, on track to meet the proposed introduction of the legislation in October 2012.
It has been introduced to address the energy efficiency of the UK’s building stock after research from the European Commission suggested that the built environment accounted for an estimated 40 per cent of total UK energy consumption. Arguably more than 50 per cent of all UK carbon emissions can actually be attributed to energy use in buildings, including residential and business emissions.
The built environment therefore has a vital role to play in delivering sustainable energy economy as recognised by the UK Government in recent Energy White Papers. The Green Deal adds to a list of initiatives to make improvements to building standards and refurbishments aimed to deliver zero carbon and implement carbon reduction commitments for large organisations and homes by 2016.
Under the Green Deal initiative Britain’s homes could say goodbye to leaky roofs and unwelcome drafts. The Government estimates that domestic and business properties are wasting £3bn of energy annually. With this in mind, the scheme states that home-owners could be entitled to up to £6,500 for improving the energy efficiency of their home, with repayments coming from the savings made in future energy bills.
The basic principle is that the upfront capital cost of the retrofit will be funded via a charge on the household’s energy bills, meaning there will be little reason not to alter the energy efficiency of your home. Even when the property is sold, the repayment will continue to be made through the energy bills by the new owner. The generic term used to describe this kind of scheme is Pay As You Save (PAYS).
Chris Huhne, Energy Secretary has announced the proposal is due to take effect in 2012, and has hinted that local authorities would play a central role in the efficiency scheme which would also help to create jobs.
While it is understood that energy companies and high street firms will pay for the upfront cost of the domestic efficiency improvements, with households paying back over time, Chris Huhne has insisted that the local councils would be involved in managing the rollout of home makeovers, particularly for those areas most in need of improvements.
Over the next forty years, the transition to low carbon can almost be read as a business plan for construction, bringing opportunities for growth at every scale. The Coalition Government has said that a move toward this kind of low carbon endorsement would bring hundreds of thousands of ‘green jobs’ potentially making the Green Deal, a very big deal to the UK economy.
The Department of Energy and Climate Change says the number of people employed in supplying and fitting insulation alone could rise from the present 27,000 to 100,000 by 2015.
While it is clear that there are many aspects of the Green Deal that need to be reviewed and restructured, specifically with regards to funding, there is no doubt that it has the potential to move Britain towards a low carbon economy. Even at this early stage there are some initiatives such as Birmingham City Council’s ‘Energy Savers’ scheme and ‘British Gas’ Green Deal’ that are leading by example.
There have also been constructive movements to develop closer links between Whitehall and local authorities to ensure that both central and local government are working together to deliver the UK’s carbon emissions targets.
Whitehall has hinted that local authorities will be able to insist that landlords of the worst performing properties make every energy improvement possible, however most action would only focus on landlords with properties with an EPC (energy performance certificate) rating of F or G. However until the deal has been finalised local authorities may find themselves performing extended roles including advisors, installers and providers.
Under the initiative local authorities have also been criticised for actively blocking wind farm and other renewable energy proposals in the past. If the Green Deal is to work and the UK is to successfully embrace a low carbon culture, reform of the planning system will be needed to make it easier for councillors to approve renewable energy projects.
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