Government pulls plug on funding for Green Deal Finance Company after only 10,000 homes sign up to energy household efficiency programme
The Government has scrapped its flagship “Green Deal” home energy efficiency programme, pulling its funding and announcing an investigation into alleged scams that have surrounded the scheme.
Launched in 2013, the Green Deal loans scheme was touted as a “revolution” in upgrading Britain’s old and draughty housing stock, designed to encourage millions of households to install insulation and new boilers.
But on Thursday, with less than 10,000 loans in place, ministers pulled the plug and acknowleged the scheme would be seen as a “total flop”.
The Department of Energy and Climate Change (Decc) said it would provide no further Government funding for the Green Deal Finance Company, which provides the loans, “in light of low take-up and concerns about industry standards”.
There will also be no more funding for the Green Deal Home Improvement Fund cash back scheme, which gave households money back on home energy efficiency improvements.
Unlike the loans, the cash back scheme proved hugely popular with consumers who cleared out funding within days of it being released.
Under the original Green Deal scheme, households were encouraged to take out a loan to fund the cost of energy efficiency work, with the loans paid back in instalments on their energy bills.
The repayments were supposed to be less than the savings from the energy efficiency work.
But the scheme has suffered from low take-up amid concerns about high interest rates and that households may not actually see savings.
Greg Barker, then energy minister, said after the scheme’s launch that he would be having sleepless nights if 10,000 homes had not signed up by the end of 2013.
Figures released on Thursday show that by the end of June 2015 there were still just 9,999 Green Deal loan plans ‘live’, with a further 5,597 pending or applied for.
Chris Huhne announces Green Deal (Sept 2010)
The disgraced former Energy and Climate Change Secretary claims Green Deal will create almost 250,000 jobs in green industries.