The 2011 Energy Act includes the provision for a new ‘Green Deal’ which is intended to reduce the cost of carbon emissions by overhauling the energy efficiency of British homes and Businesses. The ‘Green Deal’ is a financial mechanism intended to eliminate the upfront cost of energy efficiency measures and instead assures home and business property owners that the cost should be covered by the savings on their electricity bill.
The deal will also be intergrated with a new Energy Company Obligation (ECO) which will allow supplier subsidies and Green Deal finance to provide a seemless offer to end users.
According to the Department of Energy and Climate Change the Deal will allow ‘many households and businesses to imporove the energy efficiency of their properties so less energy is consumed and less money is wasted’. However, OFTEC has raised concerns that the deal does not sufficently address the growing problem of fuel poverty in rural areas. Around 25% of rural properties and in recent years the Warm Front scheme has been successful in reducing fuel bills for many rural homes but with the scheme coming to and end, OFTEC is concerned that the new Green Deal will not be as affective as the old scheme.
Jeremy Hawksley, the Director General of OFTEC has said, ”Under the Green Deal proposals, energy efficiency improvements will be financed through higher long-term electricity bills for the householder. The Green Deal needs to recognise that fuel poor households may be unable or unwilling to accept higher bills, and therefore it is unlikely there will be a significant take up of the Green Deal in rural areas. Although the scheme plans to provide assistance for both the hardest to reach and hardest to treat properties, it must focus initially on the fuel poor as a priority.”