Government To Review Green Deal Fiasco

  • Date: 16/05/12

Downing Street is about to review the government’s Green Deal after warnings that it’s liable to fail. The number of people unable to afford their energy bills is likely to rise to 8.5 million.

The Cabinet Office has been interviewing critics of the flagship scheme and is expected to report soon.

The Deal – to insulate the UK’s aged housing stock – is designed to save carbon emissions, keep people warm, and make energy affordable.

But critics say it won’t give enough help to the fuel poor, and warn it may waste £2-3bn of people’s energy bills.

They say this is a scandal after the recent warning that the number of people unable to afford their energy bills is likely to rise to 8.5 million.

The Green Deal is split into two parts. The larger part relies on householders voluntarily taking pay-as-you-save loans to cut energy bills through home insulation. The private sector is supposed to deliver the improvements.

The other part of the programme, known as ECO, will subsidise people to insulate their homes if they can’t do it without help. This will be funded through a £1.3bn-a-year charge against all of our energy bills.

But there is a dispute over the priorities.

‘Widespread’ complaints

The government says most lofts and cavity walls are already insulated under previous schemes so it wants to offer grants on much more expensive solid wall insulation.

Solid walls will ultimately have to be made warmer if the UK housing stock meets expectations for reducing carbon emissions. But it is thought that at first this expensive and disruptive option will be mostly taken up by affluent households.

Critics say it makes no sense to insulate solid walls at approximately £7,500 a home when you can insulate lofts of the “fuel poor” for £500 a home.

They also argue that the ECO subsidies scheme will force low-income families to pay extra on their fuel bills to subsidise solid wall insulation for more wealthy homes.

Complaints have been so widespread that a Cabinet Office team was detailed to interview the critics, who estimate that by pushing money towards solid walls rather than lofts the government could waste between £2bn and £3bn of energy bill payers’ money in coming years.

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