December 2013 – changes to the Green Deal proposed

The government announced a series of changes to the Green Deal and Energy Companies Obligation (ECO) in December 2013. The aim was to reduce the so-called ‘green levies’ attached to energy bills and to stimulate the struggling Green Deal scheme. The changes will be consulted upon before being incorporated into legislation. The overall changes designed to reduce energy bills were highly publicised but the specifics were harder to find so this guidance will highlight the key points which are likely to influence the general public within Hampshire.

The proposals are subject to consultation, so may change.

Changes to the Energy Companies Obligation (subject to consultation)

Overall changes to ECO:

  • ECO will be extended to 2017
  • CSCO and HHCRO obligations will be extended at current levels until 2015 with new targets set post 2015
  • CERO targets will be reduced by 33%
  • Energy companies will be able to count over-performance under  CERT/CESP towards ECO targets
  • 2015 CERO targets may be missed and carried through to 2017 (at a slightly increased rate: 1.1 times the shortfall)
  • 100,000 solid wall installations must be carried out before 2017 (or equivalent carbon saving)

The main changes to CERO:

  • Reduced target by 33%
  • Easy to treat CWI and LI will become allowable measures
  • District heating connections will be changed to a primary (stand-alone) measure

The main changes to CSCO:

  • Eligible LSOAs will expand from those falling within the lowest 15% of the IMD to those within the lowest 25% (see our CSCO pages)
  • Households in the 25% least developed rural LSOAs will be eligible for CSCO measures without needing to be receiving means tested benefits

Changes to the Green Deal (January 2014 onwards)

 Changes to:

  • Improve signposting and information about the Green Deal
  • Make it easier for companies to operate within the market
  • Improve the Green Deal finance offer
  • Speed up the process to approve Green Deal Providers

Specific suggestions:

  • Introduction of a new online tool to provide advice for householders
  • Improvement of the GDAR to make it clearer what help is on offer
  • Improved signposting to companies through the Energy Saving Advice Service and government website
  • Opening up the access to EPC data
  • Increasing the number of measures available through the Green Deal with more flexibility
  • Reducing the insurance requirements attached to Green Deal measures
  • Speeding up the Green Deal finance offer- customers can move from quote to finance in a single day
  • Changing legislation to encourage finance in the private rented sector
  • Increasing the number and range of top up loans to be used alongside Green Deal finance
  • Adjustments to the Golden Rule
  • Reducing the number of home visits required within the Green Deal process
  • The Green Deal communities funding will be increased to £80 million

Improved integration of Green Deal with ECO will also be promoted, but it is unclear how this will be achieved.

New energy efficiency incentives (from April 2014 onwards)  

  • Stamp duty rebate of at least £1000 to be spent on energy efficiency improvements (up to £4000 for more expensive measures)
  • Investment in private rented properties to help landlords meet the minimum EPC rating of E by April 2018
  • £90 million set aside for public sector buildings

Proposed timeline

January 2014: Consultation on changes

April 2014: Easy-to-treat insulation measures may begin

4th quarter of 2014: Legislation in force

What this could mean for local residents

  • More areas could become eligible for support under CSCO
  • All private households may become eligible for standard LI and CWI
  • It may be difficult to gain funding for HTT CWI and SWI
  • It may become easier to connect to a district heating network without insulating the home beforehand
  • The Green Deal may become more attractive, especially if alternative finance options are presented

Useful links:

Government action to help hardworking people with energy bills (Government Press Release – 2/12/13)

Changes to the Green Deal and the Energy Company Obligation (DECC blog post – 4/12/13)

ECO Consultation additional detail slides (Linked to in a comment on the DECC blog – 19/12/13)

Streamlining and improving the Green Deal (Government news story – 2/12/13)