Green Deal: Mean Deal?
My first musings on the Green Deal argued that homeowners, businesses and politicians alike should welcome it with open arms.
24th May 2013 | Peter Rolton: Chairman, Rolton Group
I highlighted its huge potential for fighting fuel poverty, which every year causes preventable illness and death, and the benefits of a system that ties repayments to a property rather than the individual. These points, alongside the much-lauded ‘golden rule’ that states repayments must be at least nullified by energy savings, made the initiative look like an attractive option, accessible to homes across the UK regardless of personal income.
The Deal was launched months later than originally planned, and this disorganisation was a sorry sign of things to come. I wrote an accompanying post, in which my attitude could be nothing less than sceptical in the face of so many facts which had come to light since I last broached the topic:
- Assessments typically cost in the region of £100. Given that the target demographic contains the most financially vulnerable, from which piggy bank are these households expected to summon up such a substantial amount of money?
- The loans themselves are not interest-free, or anywhere close. In fact, studies found that most consumers would be better off taking out a high street loan or even re-mortgaging their homes than turning to the Green Deal Finance Company.
- Awareness is pitiful; 98% of people asked in December 2012 reported not fully understanding the scheme. Not great for a flagship policy from the ‘Greenest Government ever’.
These are among a much longer list of issues that reared their heads in those few, short months.
The most important quality of the Green Deal is that it has to be highly compelling; it must be the obvious financial choice, whilst being straight forward enough to induce those who would otherwise sit on the fence. It is completely failing to achieve either point.
Now it’s in the news again, and the reasons are twofold. First, people are starting to notice that the Department for Energy and Climate Change (DECC) are more than a little reticent about revealing the uptake figured of individual Green Deal contracts. This is never good news: if it were, we all know they’d be shouting it from the rooftops. Instead, they focus on the more impressive number of assessments which have so far taken place, but an assessment is no indicator of how many people are actually benefitting from the initiative. If 19,000 households consider their efficiency options and none move forward with a plan for change, what can we say has actually been achieved? Although official figures won’t be released until next month, some reports suggest that only around 100 plans are now in progress. If this is the case, the £10 million advertising budget would have been better spent simply paying for the installations, with plenty of change left over.
Second, the Energy and Climate Change Committee on Wednesday released their ‘The Green Deal: watching brief’ report, in which they raised a fundamental question: what exactly does the Government consider to be the mark of success here? Such a scheme, publicised as a game-changing move into a cheaper and cleaner economy, surely must be implemented with a clear view as to what would warrant celebration and what would be cause for concern… but apparently not. A lack of specific projections and progress indicators leave the Green Deal underpinned by what looks increasingly to be a lot of smoke and mirrors rather than the systemic integration of proper research, strategy and improvement. If nobody can define what the goal actually is, how can we hope to hit it?
With such a catalogue of missteps and evasion eroding public faith, it’s easy to feel jaded about the possibilities brought by this policy. It isn’t too late for the improvements necessary to see it reach its potential, though; the Green Deal was brought in to fight for a worthy cause, and it still can. If the Government was to provide this scheme with anywhere near the backing it has given to kick-starting the first-time buyer market, surely the results would be just as impressive. Energy bills may not be as glamorous as buying houses, but they are just as important in the growth of our economy and standards of living.
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