January 2013 – Something On “Green Deals” – Nothing On Moral Imperatives

Author: Mitchells Roberton
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Towards the end of last year Alex Salmond said that oil-rich countries like Scotland have a moral obligation to invest in green energy:

“It’s not just an economic opportunity, it’s a moral imperative that hydrocarbon countries lead the way in renewable energy technologies.”

 

This Note does not enter the fray about moral imperatives generally or their application to the climate change and renewable energy debate – interesting though that might be. It has a more modest and domestic aim.

In amongst the headlines about moral imperatives there has also been recent mention in the press about Scotland’s “Green Deal” as applied to energy saving for your home or business. This Note aims to outline what that involves.

What the Green Deal is

  • It is a scheme where you can make energy-saving improvements to your home or business without having to pay all the costs up-front if you subscribe for a “Green Deal Plan”.
  • Energy-saving improvements include:
    • Insulation e.g. loft or cavity-wall insulation
    • Heating
    • Draught-proofing
    • Double-glazing
    • Renewable energy technologies e.g. solar panels.

STEP 1 – getting an assessment

 

  • First, you need to get an assessment on your property to see what improvements you can make and how much you can save on your energy bills.
  • For example the nearest one for this office would be EAS – Energy Assessors Services Limited (“Green Deal Approved”)  in Ayr (who were certified as assessors on 14th January 2013).
  • Alternatively you can get a “Green Deal Provider” to find an assessor for you. As the term “Provider” suggests, a “Provider” is concerned with actually doing the work – rather than just assessing what work might be done. And, if you use a “Provider” to find an assessor for you, then that Provider must also be the one that does any work for you.
  • You may have to pay for an assessment – you should check with the assessor or Provider before the appointment.
  • The assessor comes and inspects your property and discusses your energy use.
  • The assessor will give you a Green Deal Advice Report. This explains what improvements you can make and how much you could save on your energy bills.

 

STEP 2 – Once the assessment has been done and you have got your “Green Deal Advice Report”

 

  • Armed with your Green Deal Advice Report you can then contact a “Green Deal Provider” to discuss what work is right for you.
  • You can get quotes from as many providers as you like. You do not have to go ahead with all – or any – of their recommendations.

 

STEP 3 – Calculation of repayments

 

  • The idea is that the amount you repay for Green Deal improvements is based on what a typical household (or business) is expected to save on energy bills by having the work done.
  • So, the theory is that:
    • you have the work done;
    • you reduce your energy bills as a result;
    • you pay for the work as part and parcel of your electricity bill;
    • but, the amount of your energy bills may nevertheless stay roughly the same as before you had the energy-saving work done.
  • The cost (including interest) will be shown on your Green Deal Plan – i.e. the contract between you and your chosen Green Deal Provider.
  • The repayments might be made over quite a lengthy period. If you sell before all the repayments have been made the buyer will be the one liable for future repayments. So, if on the other hand, you are the buyer of a property subject to a Green Deal you will be the one liable for future repayments (see below under: Moving into a property that already has the benefit a “Green Deal”).

STEP 4 – How you make repayments

 

  • You will pay the money back through your electricity bill.
  • So the Green Deal stays with the property – i.e. if you move you will no longer benefit from the improvements you have made and so will no longer have to pay for them.

A couple of related points

 

Moving into a property that already has the benefit of a “Green Deal”

 

  • If you move into a property the seller (or the landlord) must have made available to you (at no cost to you) an “Energy Performance Certificate” (“EPC”) (under Regulation 5 Energy Performance of Buildings (Scotland) Regulations 2008/309).
  • Where the property is subject to a “Green Deal” the EPC will explain what improvements have been made – and how much you (as buyer or tenant) need to repay.

Cash-back scheme

 

  • The Scottish Government is offering home-owners and tenants up to £500 towards energy efficiency measures that are recommended in either an EPC or Green Deal assessment.

Note: This material is for information purposes only and does not constitute any form of advice or recommendation by us. You should not rely upon it in making any decisions or taking or refraining from taking any action. If you would like us to advise you on any of the matters covered in this material, please contact Alison Gourlay: Alison@mitchells-roberton.co.uk.

 

 

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