The Green Deal: Most asked questions

The Green Deal is a Government run scheme to improve the energy efficiency of households around the UK.

A loan is issued to help cover installation costs of insulation or a new boiler, which is then paid back with the money you save on energy bills. The scheme is intended to support the uptake of improvement measures without you needing to pay the full amount straight off.

The scheme works differently to taking a loan from the bank. Instead of it being a personal loan, it’s instead attached to the property. So if you move home, the loan stays behind for the new owner. You must still go through the same credit checking process though.

The loan is issued by a Green Deal Provider and they will determine how long the loan will be, the interest rates and how much you can borrow.

What interest rates will I pay on a Green Deal loan?

The rates are determined by the provider, so they’ll differ depending on the company you choose to go with.
The loan funding is provided by the Green Deal Finance Company and according to them, interest rates can vary between 7.67% and 9.3%. This will be based on factors such as the loan’s length and how much you take.

How do I repay a Green Deal loan?

The good news is no money comes out of your bank account, so you won’t be any worse off. Instead the charges are added to your electricity bill, taking into account the amount you’re saving with the efficiency improvements.

The provider you opt with will inform your energy company of the agreement and arrange for the payments to be attached to your electricity bills. The supplier will then contact you to confirm this, before taking payments from bills.

Will my electricity bills increase if I take a Green Deal loan?

The Golden Rule of the Green Deal is what makes the scheme such an attractive proposition. The rule states that you won’t pay back any more than you’re saving with the improvements in place. Therefore you’re not losing anything. This means that in theory you won’t see more expensive electricity bills.

The only problem is though; this rule isn’t completely guaranteed, despite the scheme’s best intentions. The rule is based on estimations made regarding the amount you could save and future energy price increases aren’t taken into account.

Can I get any subsidies or cash back with the Green Deal?

Whilst the Green Deal isn’t a loan or grant from the Government, there are some initiatives to make improvements cheaper. This is mainly through the Energy Company Obligation (ECO) scheme. Improvements linked with discounts include hard-to-treat cavity wall insulation and solid wall insulation.

The Government is also offering cash back to reduce the cost of energy efficient upgrades to your home. This is outside of the Green Deal, but you’ll still need an assessment from a Green Deal professional. The improvements will also be made by a Green Deal supplier.


Facts & Figures You’ll Love To Share

  • As many as 26,000,000 homes in the UK could be eligible to receive Green Deal funding.
  • Green Deal loans are paid back over a 10-25 year period with the payments taken from energy bill savings.
  • Using the Government’s Green Deal you can upgrade your boiler, improve insulation and replace windows for no upfront fee.
  • The Green Deal’s Golden Rule states that homeowners won’t pay back more than the savings they make on energy bills with improved efficiency.

Evy Coe

Evy works for Quotatis as a Content Marketing Executive. She loves to write about interior design and help homeowners with their DIY projects.

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