The government must make major changes to the green deal if it is to help people out of fuel poverty, cut emissions or boost the economy
Household energy consumption is responsible for nearly a third of carbon emissions. The public can’t be passive spectators as we move to a low carbon economy - they need to be active participants.
The government claims the green deal will be a ‘game-changer’. In principle, we support a pay-as-you-save scheme for home retrofits - it was in Labour’s manifesto before the last election, and pilots started under us too. But major changes are needed if it is to deliver real savings for bill payers, help the fuel poor or boost the economy.
Working with shadow climate change minister Luciana Berger, Labour has set out five simple ways to improve the scheme.
First, the financing of the green deal has to be attractive, or the scheme will never get going. Although the green deal is due to start in a matter of months, the government still hasn’t spelt out what the interest rates residents will have to pay. Research suggests they could be as high as 8 per cent, which would deter more than 90 per cent of people from taking it up. In our view, the government should commit to using the green investment bank to make interest rates affordable.
Second, we must ensure the green deal works for families most in need of help. With soaring energy bills, more people will be at risk of fuel poverty. But the government’s plans will give three times as much support to households which can already afford to improve their properties, rather than helping families which can’t even afford to heat theirs.
Funding from energy company obligation should be split equally between affordable warmth and carbon saving targets, and the priority should be low-income, hard-to-treat homes, over able-to-pay homes.
Third, the green deal and ECO should be available for the 4 million harder-to-treat properties with cavity walls. By the Department for Energy and Climate Change’s own estimate, loft insulations will fall by 90 per cent and cavity insulations by 70 per cent. This will be disastrous for our insulation industry. To stop firms going bust and protect jobs, we need a transition plan.
Fourth, the green deal should help people living in the private rented sector. Around 680,000 private rented properties in England have the worst energy efficiency ratings - F and G. The state should not be subsidising sub-standard housing through housing benefit, or lining the pockets of irresponsible landlords who fail to ensure their homes are warm and properly insulated.
No one should have to put up with poor standards. At the moment, landlords with F and G properties are only required to carry out some sort of improvement in efficiency. The government should adopt Labour’s plan for a proper minimum standard, enforceable from 2016 (the date of the UK’s target to eradicate fuel poverty).
Fifth, we have to make sure the green deal works for social landlords, small businesses, charities, co-operatives and councils, not entrench the
dominance of the big six energy companies.
Under Labour, more than 8 million homes were insulated. But Britain’s building stock is still Europe’s most inefficient. Energy bills are at record levels. Unless the government changes course, millions of people will still be spending hundreds of pounds on heat that immediately escapes their homes.
Caroline Flint is shadow secretary of state for energy and climate change