12 people. Just 12. That was the number The One Show on BBC last evening (16th Oct) quoted as taking up the ‘Green Deal’ through to completion. The government's programme to encourage energy efficiency measures and provide loan finance to pay for them was, it implied, a failure. Then today (17th Oct) official statistics up to the end of September were released by DECC.
85,177 Green Deal assessments have been lodged, 13,967 in September itself.
954 of the lodged assessments have reached at least the ‘quote accepted’ stage, of which just 57 are ‘live’, i.e. have had the work completed (a low number, but better than the the 12 quoted on the One Show, which was the end of August figure).
The roll out cost of the programme, spent by government to get the thing going as distinct from loans made, is £16 million. That’s about £16,000 per deal in the pipeline. The headline figure of £280,000 per completed deal is much more eye-catching, but not as fair – it takes time to get work done. Both figures will come down.
Greg Barker (@GregBarkerMP on Twitter) the minister responsible, said when Green Deal was launched that he’d have sleepless nights if 10,000 hadn’t taken up the deal by the year end, but he claims still to be sleeping well. Many of the assessments, he said, up to 80%, have resulted in people making, or likely to make, improvements, but financing it themselves. Why is that?
Here’s another number: the average annual interest rate on Green Deal loans is 7% and could be as high as 10%. That’s not exactly Wonga territory, but it’s still high. Then there is the fact that the Green Deal loan attaches to the property, not the person, so that when you come to sell your house you have to “sell” the debt as well. For rented property, both the landlord and the tenant have to agree to it. Result: a package that is not necessarily attractive.
Which could be why so many are saying “No Deal”.
If you’re politically minded, you could use these figures to berate the government: “It's a failure. All that money spent and less than a thousand people following through – you could have built 20 windmills for that.” The risk with branding something a 'failure' is that you then have to 'do something' about it, so that just as people are starting to get used to it and make it work, you abolish it and introduce something new – which in turn is branded a 'failure' before it has a chance to get going properly.
Is the Green Deal the best and most cost-effective way of encouraging green energy measures? Quite possibly not. Is it better than nothing? Let's put it this way: if the scheme has encouraged people to have their houses assessed and take action to improve their energy efficiency, does it matter that they haven’t used the Green Deal to finance it? I would suggest not.
These are personal opinions and should not be misunderstood as representing the opinions of WREN.