What is Green Deal?

The Green Deal is a government led scheme to help homeowners and landlords to invest in renewable energy or energy efficient products, by providing them with attractive finance which they could repay through their electricity bills.

Greenstone Finance and Aurium Capital Markets have aquired of the business and assets of the Green Deal Finance Company www.gdfc.co.uk as well as its existing loan book with a principal value in excess of £40m; the acquisition is being supported by Honey-comb Investment Trust which is managed by Pollen Street Capital.

First launched by the Government in 2013, the Green Deal was established to address the fact that the UK has some of the most thermally inef-ficient housing in Europe. Green Deal loans provide customers with accessible financing to improve their homes by installing energy efficiency products.

  • In particular, Green Deal financing has the potential to help:
    those who face the heavy costs of needing to install a new boiler or other essential measures but who can’t afford to pay the upfront costs of doing so;
  • those who want to increase the value of their homes through installing renewable energy or energy efficiency measures;
  • landlords requested by tenants to install energy efficiency improvements or, as of April 2018, landlords who own properties that fall be-low the new minimum energy efficiency (EPC) rating of E;

Green Deal loans not only offer competitive interest rates, but are more easily managed as loans are repaid as part of a customer’s energy bill, which will normally be reduced by the energy savings generated from the measure the loan has financed – a “Pay-As-You-Save” scheme. Furthermore, the loan remains with the property and is paid by the energy bill payer from time to time – ensuring the payments are made by the person who benefits from the energy saving.

Key Eligibility Criteria

Eligible Measures under Green Deal Plans

  • New or replacement boiler (condensing, biomass)
  • Solid Wall (internal & external)/ Loft/ Floor Insulation
  • Cavity Wall Insulation
  • Heating/ Hot Water/ Lighting Controls
  • Heating System Insulation
  • Ground and air source heat pumps
  • Fan assisted storage heaters
  • Flue gas recovery devices
  • Innovative hot water systems
  • Draught proofing

Eligibility Requirements for Green Deal Plans

  • Minimum age of 18 years’ old & maximum age of 75 years of age.
  • Minimum annual income of £12,000
  • Property must be a fixed address in England, Wales or Scotland
  • No County Court Judgments in the previous 2 years or bankruptcy in the previous 5 years
  • You must consent to having a credit check performed
  • If you are a landlord, you must receive consent from your tenant
  • If you are a tenant, you must receive permission from your landlord
  • You should have a good credit history i.e. equivalent to a credit score of 694 with Experian

The following are the main benefits for customers financing their home energy improvements through a Green Deal Plan:

  • This is the Government led Green Deal scheme
  • You will benefit from a warmer and more energy efficient home, with reduced upfront costs
  • Plan repayments are hassle-free because they are added automatically to your existing electricity bill
  • The plan is linked to your property, rather than you, so when you move house the plan remains with the property it is benefitting
  • The interest rates charged are competitive
  • The eligibility criteria are simple and the application process can be carried out in the comfort of your own home
  • The cost of the loan will, in part, be paid for via the energy savings achieved
  • Depending on the energy efficiency improvements being made, the repayment term may be up to 25 years enabling more affordable monthly repayments
  • All Green Deal Plan home improvements are guaranteed for the expected lifetime of the measure

There are 4 simple steps to getting a Green Deal Plan:

1. Assessment – You’ll need to get a Green Deal assessment carried out on your home, by a Green Deal Assessor. They will produce a Green Deal Advice Report recommending energy saving improvements and indicating whether they are expected to pay for themselves through reduced energy bills. Simply make an appointment for a time that suits you best and one of our expert Assessors will visit your property to carry out an energy-efficiency assessment

2. The Plan – We’ll provide a quote for a Green Deal Plan, setting out the measures you’ve decided to have installed, the repayments and the interest rates that will be charged. If you are happy with the quote, we’ll help you complete the credit application for the Green Deal Plan

3. Installation – Once your credit application has been accepted, you will receive a Green Deal Plan Document pack which you will need to review, sign and return to us for the application to be finalised. Once finalised, we will then arrange for one of our accredited Green Deal Installers to fit the energy efficient measures

4. Repayment – Your Green Deal Plan repayments will automatically be added to your electricity bill allowing you to relax and enjoy the benefits of your energy efficient improvements!

A Green Deal Plan is a hassle-free, competitive option for a range of people including:

  • Those who want to make improvements to their home by introducing energy efficiency measures
    • Of the estimated 22.8 million households in England, 14.3 million or 63% were owner occupiers with only 24% of these households having an EPC rating of A-C (2015/ 2016 English Housing Survey report)
    • Outright home owners have lived in their current home for longer than mortgagors (24.4 years compared with 10.2 years)
    •  Given the lengthy tenure and low EPC ratings (on 76% of all such households), these owner occupier households provide an opportunity to market the attractiveness of the Green Deal Plan proposition where multiple measures can be financed across a longer repayment term
  • Anyone with a requirement to improve their energy EPC rating, e.g. landlords.
    • From the 1st April 2018, there will be a requirement for any properties rented out in the private rented sector to normally have a minimum energy performance rating of E on an Energy Performance Certificate (EPC)
    • The regulations will come into force for new lets and renewals of tenancies with effect from 1st April 2018 and for all existing tenancies on 1st April 2020
    • It will be unlawful to rent a property which breaches the requirement for a minimum E rating, unless there is an applicable exemption
    • A civil penalty of up to £4,000 will be imposed for breaches

GREEN DEAL PLAN & THE PROVIDERS’ ROLE

The Green Deal Plan sets out the financial terms of the agreement and includes consumer protections, such as warranties, to cover the energy efficiency improvements and installation, including dealing with customer complaints and providing information when a new bill payer moves in.

Only an authorized Green Deal Provider can offer a Green Deal Plan.

Green Deal Providers must operate to a high standard. We currently hold a Category ‘A’ Consumer Credit License which is the highest possible rating, therefore you can rest assured any policy you take out with ourselves will be implemented to the highest standard.

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