What is The Green Deal’s Golden Rule?
What is The Green Deal’s Golden Rule?
The Green Deal aims to improve energy efficiency for 26 million homes and up to 2.8 million commercial properties by the year 2030. With such ambitious development plans set in place, the government have created the Green Deal’s “Golden Rule”, which is intended to protect the property owner and act as the back bone of the entire scheme.
The Green Deal’s Golden Rule states that the energy savings a property makes in a 25 year period must be equal to or more than the cost of implementing the changes in the first place. This ensures that the property owner is not paying back more to partake in the Green Deal than they are saving on their energy bills.
The “Golden Rule” also states that each property will be accessed individually, by an accredited, objective advisor and allocated an amount of money, dependant on the potential savings. Installations must also be carried out by accredited installers. This ensures that the property owner is not investing money in work which will not save them money on their energy bills.
The Green Deal Golden Rule – Protecting the Property Owner
With the emphasis on protecting the property owner, the Green Deal Golden Rule will place a cap on the amount that can be collected in the first year of a Green Deal payment to the estimated annual savings. This also safe guards the installers and helps reduce the risk of the property owner not being able to make the payments. The amount the Green Deal payments will increase by during the following years will also be controlled.
Possible issues with the Green Deal’s Golden Rule
It is impossible to predict or guarantee a rise or fall in future energy costs. Although the Green Deal’s Golden Rule will protect the property owner in the short term, it is not possible to guarantee that future energy savings will not increase over longer periods of time. It is worth mentioning, however, that property owners who have invested in the Green Deal, on a fixed interest rate, are likely to see their energy costs rise less than they would have done without the Green Deal measures in place.
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