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Government axes Green Deal 'to protect taxpayers'

The government has axed the Green Deal amid concerns about low take-up and “industry standards”.

According to Construction News, further funding to the Green Deal Finance Company and the Green Deal Home Improvement Fund will now come to an end in what the government has called “a move to protect taxpayers”.

The UK Green Building Council has criticised the decision, saying it “will leave the energy efficiency industry battered and bruised”.

Energy secretary Amber Rudd has called on the construction industry to devise “a new policy and build a system that works”, adding that the government was still committed to reducing energy bills for 1 million homes by 2020.

She said: “We are on the side of hardworking families and businesses, which is why we cannot continue to fund the Green Deal.

“It’s now time for the building industry and consumer groups to work with us to make new policy and build a system that works.

“Together we can achieve this government’s ambition to make homes warmer and drive down bills for 1m more homes by 2020 – and to do so at the best value for money for taxpayers.”

The decision to scrap the Green Deal, which offered loans to households for energy-efficient improvements, comes as part of a wider review of government energy policy.

UK-GBC chief executive Julie Hirigoyen said: “With each passing day, this government puts an end to another green policy. The government’s strategy on dealing with high energy bills through home energy efficiency is now dead in the water.

“While the Green Deal was by no means perfect, the principle of enabling households to install energy-saving measures without paying upfront costs was sound. The irony is that the scheme was finally becoming established and the number of plans was growing.

“This is yet another announcement with no forewarning that will leave the energy efficiency industry battered and bruised.”

The government has commissioned BRE chief executive Peter Bonfield to lead an independent report “to look at standards, consumer protection and enforcement of energy efficiency schemes”.

The GDFC said it would not accept further applications for financing under the Green Deal, to ensure that the company has “sufficient funds to meet all expected liabilities”.

GDFC chief executive Mark Bayley said the company had “more than met our mandate” of creating a pay-as-you-save energy efficiency scheme.

He also stressed that the company would honour its commitment to those with financing in place for Green Deal schemes.

He said: “The most important thing at the moment is for us and the Department [of Energy and Climate Change] to reassure those who currently have Green Deal finance plans in place and those with approved applications, that today’s announcement does not change anything for them.

“We have taken this step to make sure we can meet all our expected liabilities and to have an orderly run-down of new business, while protecting existing plan-holders and those whose applications are eligible and have been approved.

“We appreciate that the government must review its energy efficiency priorities and we are grateful to DECC for its considerable support over the life of the GDFC.

“We are also proud of what has been achieved in only a relatively short time.”

According to the GDFC website, the company has received applications for more than £100m worth of financing since July 2013.


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