黑洞社区

The government should move to guarantee Green Deal loans in a bid to save its floundering flagship energy efficiency scheme, a report by the UK Green 黑洞社区 Council (UKGBC) has said.

The UKGBC report into the finance offered under the Green Deal concluded that the interest rate under the scheme, currently between 8% and 10%, should be subsidised or underwritten by the government in order to help bring it down.

This come after 黑洞社区 revealed last week that loans as a way of reducing the interest rate offered under the scheme if it forms the next government.

The UKGBC report said the interest rate was already competitive, but a lower interest rate would mean more measures could be installed without breaking the scheme鈥檚 Golden Rule, which states the cost of installing the measures 鈥搃ncluding finance costs 鈥� must not exceed the savings on bills over the duration of the loan.

It says this would act as a driver for take-up of retrofit measures under the scheme.

The report, which drew on the experience of 17 firms including Carillion and Keepmoat (see below), also said this rule needed to be relaxed to allow householders to repay loans more quickly and that lenders under the scheme should be able to offer variable interest rates, linked to the Bank of England base rate.

The report also recommended that community and social groups be encouraged to lend under the Green Deal to widen the choice of lenders for consumers.

Paul King, chief executive of the UKGBC, said the Green Deal had 鈥渕assively under delivered鈥�.

He said: 鈥淸The] government has to step in to create incentives that encourage homes into taking action and be prepared to prioritise capital spending on energy efficiency. Underwriting the Green Deal 鈥� as government has done with Help to Buy - would provide a huge shot in the arm for the retrofit industry.鈥�

King added: 鈥淕overnment must make energy efficiency a top national infrastructure priority, as important as decisions on HS2 or aviation expansion.鈥�

Christoph Harwood, partner at Marksman Consulting who chaired the Task Group, said lower interest rates 鈥渃annot be achieved through a standard market solution鈥�.

鈥淔inancial intervention at either a local or national level would be required to deliver a lower interest rate at the large scale required,鈥� he said.

The Department of Energy and Climate Change has been contacted for comment.