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Ending of Green Deal hurts industry's ability to plan, say experts


The scrapping of a government funding programme promoting domestic energy efficiency is part of a pattern of policy changes that are damaging the UK's ability to reduce carbon emissions, an expert has said.

The UK government will stop funding the Green Deal, a long term loan system for installing energy efficiency measures, and has already announced a review of other energy efficiency measures and the scrapping of a policy that demanded that all new homes built from 2016 are carbon neutral.

Property expert Georgie Messent of Pinsent Masons, the law firm behind Out-Law.com, said that the changes created regulatory uncertainty that made it difficult for companies to plan ahead.

"This causes real problems in practice for companies trying to act pro-actively to achieve compliance ahead of deadlines and creates real frustration," she said. "The current government, while obviously being sensible in reviewing policy, needs to bear this in mind."

"The changes to energy efficiency policy, along with changes to fiscal incentives for renewables, are creating real regulatory uncertainty that is damaging the UK’s drive to a lower carbon future," she said.

The summer Budget said that the government would examine other tax and funding schemes designed to support carbon reduction. It said a review would "consider the Climate Change Levy (CCL), Carbon Reduction Commitment (CRC) energy efficiency scheme and their interaction with other business energy efficiency policies and regulations".

Pinsent Masons expert Jeremy Chang  had previously warned that the Green Deal scheme would struggle to attract enough users to be a success. The government said that the decision to end funding for the Green Deal Finance Company was down to low take-up as well as "concerns about industry standards".

"The Green Deal was a sound enough concept and certainly had government backing at launch but it never grabbed the public’s attention," said property expert Siobhan Cross of Pinsent Masons. "I think the high finance costs, over a period when borrowing costs were low, coupled with uncertainty as to the effects of a Green Deal package on the marketability of a property meant that it never really took off."

Energy and climate change secretary Amber Rudd said that the government would establish a new scheme to promote domestic energy efficiency but there is no immediate replacement for the Green Deal.

Chief executive of the UK Green Building Council Julie Hirigoyen said that the scrapping of the scheme with no notice would leave the energy efficiency "battered and bruised".

"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," she said. "The irony is that the scheme was finally becoming established and the number of plans was growing."

Pinsent Masons's Cross said that "without meaningful alternative measures to reduce carbon emissions the latest policy changes risk reversing any progress made on this important issue".

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