To have any hope of hitting our legally binding carbon targets and to keep people out of fuel poverty, we have to radically transform the energy performance of housing stock.
But the bill for refurbishing our stock to the required standard is very high: something like £7bn to £15bn per year until 2050. A hell of a pill for treasury to swallow as part of general spending.
Enter Green Deal. Under this arrangement, Government don’t have to fork out the money. Instead, Green Deal captures the estimated value of future energy savings that result from a low-energy refurb, converts these annual savings into one lump sum and then uses this lump to carry out the refurb in the first place. Get it all just right, and the capitalised savings are worth more than it costs to carry out the refurb. Brilliant! Refurb bill sorted.
Except we now know that getting it just right (also called fulfilling the “golden rule”) is very tough. In fact, you can usually only fulfil the golden rule for measures that have a very quick payback. Like loft or cavity wall insulation – the same low hanging fruit that the energy suppliers have been targeting under CERT, probably resulting in carbon cuts of only around 15%. Nothing like the 80% cuts we’re legally bound to achieve under the Climate Change Act.
What happened to solid wall insulation? Double or triple glazing? Insulated floors? MVHR? What happened to the sort of comprehensive refurb that delivers high efficiency and deep cuts in carbon?
They’re off the menu because they’re too costly. Instead, Green Deal looks set to deliver the same old measures that the big 6 have been rolling out for years. Only GD may be much much worse at it, even leading to a massive collapse in the number of lofts and cavities filled.
Discussion and debate about Green Deal is raging in the media at the moment. Green Deal was compulsory if you carried out significant home improvements (the infamous conservatory tax). Then suddenly it wasn’t. The Tory’s were all for Green Deal. Then they weren’t. The big retailers were in. Then they were out. George Monbiot hated it all along. Private banks won’t lend unless the GIB does first. GIB won’t lend unless the private banks promise to shoulder the whole burden – someday. And on and on.
And in the midst of all this noise, we failed to grasp a crucial fact: Green Deal won’t deliver the carbon cuts we need from existing stock. Not even close. While we’re busy arguing about stealth taxes, cowboy salesmen and mobilising early movers, the existing stock timebomb carries on ticking.