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The Green Deal

The Green Deal . Paul McCloghrie DECC 14 June 2011. Household emissions – the challenge. Carbon budgets are equivalent to a 34% cut in greenhouse gas emissions by 2020. Household emissions have been relatively static recently (c.25% of the UK total).

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The Green Deal

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  1. The Green Deal Paul McCloghrie DECC 14 June 2011

  2. Household emissions – the challenge Carbon budgets are equivalent to a 34% cut in greenhouse gas emissions by 2020. Household emissions have been relatively static recently (c.25% of the UK total). The household sector will need to reduce direct emissions by 29% on 2008 by 2020.* * Based on analysis the most practical and cost-effective route to achieving economy wide reductions

  3. What change is needed by 2020? MtCO2e 24 Mt cut (29%)

  4. - Reduce the energy required to heat our homes Insulation More efficient heating systems Better heating controls Produce low carbon heat Solar thermal Heat pumps Change behaviour Attitudes Enabling technologies How do we fill the gap?

  5. - How do we fill the gap? Reduce demand Renewables £/tCO2e Solar Thermal (replacing gas) 850 Solar Thermal (non-net bound) 300 Biomass boilers (non-net bound) 250 Ground Source Heat Pumps (non-net bound) 200 Local Authority Solid Wall Insulation External Solid Wall Insulation Internal Solid Wall Insulation 150 Loft Insulation 100 50 0 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 -50 -100 Air Source Heat Pumps (non-net bound) Air Source Heat Pumps (replacing gas) -150 MtCO2e Solid Wall Insulation Loft Insulation Cavity Wall Insulation -200 -250 Smart Meters -300 Note: The technical potential indentified in the MACC reflects judgements made on feasibility which are subject to uncertainty.

  6. The origin of the Green Deal Through our ‘Green Deal’, we will encourage home energy efficiency improvements paid for by savings from energy bills. We will also take measures to improve energy efficiency in businesses and public sector buildings. The Coalition: our programme for government (May 2010)

  7. Assessment Finance Installation Repayments and Follow Up The Green Deal Process • All Green Deals start with an assessment of the property • Accredited assessor produces – fabric and behavioural assessment

  8. The Principle: Golden Rule Green Deal repayment – illustrative only • Repayments will be made through energy bills • The cost of installation will stay with the property rather than the original bill-payer • Are the savings guaranteed? • No – but they will be based on typical savings. We cannot account for changing energy prices or behaviour change. • A Code of Practice will ensure the benefits of measures cannot be overstated. • The assessment will cover how the energy bill payer can benefit most from the measures installed.

  9. Green Deal Measures

  10. Call for Evidence • The Call for Evidence received over 300 submissions • It is due to report at the beginning in June • The report will cover the cost and benefits – financial and energy savings – of the measures most likely to meet the Golden Rule at the launch of the Green Deal • Strength of testing is key

  11. Call for Evidence – Measures covered

  12. Customer Protection and the Golden Rule There are a number of ways the consumer is protected: • The Golden Rule: Providers cannot attach more finance to the energy bill than the measures are predicted to save • For domestic customers, the Consumer Credit Act applies • Accreditation of Green Deal participants – installers, assessors, ‘providers’ • Robust redress systems

  13. Oversight and Accreditation Model SoS (Primary Powers) Code of Practice Installer oversight contractor Reports to DECC SoS PAS standard managed by BSI Accreditation Body (UKAS) Accredit and monitor Cert bodies to PAS Umbrella / Certification bodies Specialist trades & General trades Installer companies / GD Providers

  14. Boilers and Green Deal • More efficient boilers are a important part of reducing energy use in buildings. • In cases where the energy savings could not pay for the measure over its lifetime, customers could part finance measures upfront. • Robust product and installation standards already exist for the boiler industry, putting it in a good place to take advantage of the opportunities.

  15. Energy Company Obligation: Delivering Affordable Warmth • One of ECO objectives to help low income vulnerable people heat their homes more affordably • Taking powers in the Energy Bill to set suppliers an ‘affordable warmth’ target • Could offer new/repaired central heating systems to help meet this target • Looking into case for allowing heat pumps to be delivered to off-grid homes

  16. Energy Company Obligation: Supporting Hard to Treat homes • One of ECO objectives is to support the improvement of harder to treat properties • Expect energy suppliers to deliver through partners and combine subsidy with Green Deal finance • Looking at ways to ensure the market is open and competitive • Consultation in the autumn

  17. Questions? Paul McCloghrie paul.mccloghrie@decc.gsi.gov.uk

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