The Green Deal is designed to revitalise and drive a competitive and enduring market for energy efficiency. The scale of the opportunity is great.
- The global market for low carbon technologies is estimated to reach £4 trillion by middle of this decade;
- The size of the energy efficiency market in Great Britain has been estimated to be over £8 billion;
There will be opportunities for companies marketing, selling and installing a broad range of measures under the Green Deal. For example, between 7 and 8 million properties with solid walls have not been insulated.
There is also great potential for newer and emerging technologies in the market. As the market grows for these measures, we can expect they can be installed more cheaply and efficiently.
The Green Deal has been designed to finance the installation of a broad range of energy efficiency measures, products and systems. Annex A of the consultation document lists the 30 measures which are already recognised as improving the energy performance of buildings and can generate fuel bill-savings. Amongst the qualifying energy improvements are insulation, heating, glazing, lighting and microgeneration measures. We are consulting on which measures should be added to the list for non-domestic properties. We propose that the list of qualifying improvements is updated on an annual basis.
Preparing for the launch of the Green Deal
We intend to produce a joint industry and Government Green Deal and ECO Guide for Industry intended to support companies and to showcase examples of what some organisations are already doing to prepare for and to maximise the opportunities presented by the Green Deal.
Prospective installers and assessors should look out for future publications on accreditation requirements and keep in touch with their trade associations. Interested parties can also sign up to the Green Deal Bulletin on the Green Deal page of the DECC website.
Why is there no target for what the Green Deal must achieve?
The Green Deal is part of our efforts to meet carbon budgets, which are clearly set out in legislation. As a minimum, the Green Deal and ECO combined will need to enable the necessary carbon reductions to help meet our carbon budget commitment.
Our ambition is to enable as many of the 26 million households and 4.5 million businesses as possible in Great Britain to benefit from energy efficiency improvements in the most cost-effective way. In line with this ambition, the Green Deal is designed to finance a broad range of energy efficiency improvements.
How can the supply chain confident that there will be sufficient demand and the market will be there?
The Green Deal framework is being designed to allow companies to develop their own innovative approaches to driving demand. There is already significant business interest in the Green Deal and ECO, with a wide range of organisations recognising the opportunity and gearing up as potential assessors, Green Deal Providers, suppliers and installers.
Tough carbon and affordable warmth targets within the ECO will result in billions of pounds being injected into the market in the coming years. In addition, we are considering whether to introduce “interim obligations” to help to ensure that, for the sectors covered, momentum is created early on.
We are exploring the potential to introduce a form of brokerage arrangement linking ECO companies and potential delivery partners, putting them in touch with each other and matching offers of ECO subsidy with the various offers of cost-effective delivery within the Green Deal framework. This might introduce greater transparency and liquidity into the market overall. We will continue to seek views on these important issues from industry and other stakeholders.
To further build interest Government will continue to engage businesses, charities, local authorities and other groups to ensure that the Green Deal realises its potential. The 2011 Budget also confirmed the Government’s commitment to act to encourage and incentivise take-up of the Green Deal.
How is DECC supporting innovation?
DECC is keen to draw on the findings of other projects and programmes of work which are exploring the potential for innovation in products and production processes across the supply chain. Examples of some of the projects we are linked to include:
- DECC’s £35 million Low Carbon Buildings Innovation Programme;
- DECC’s 2050 Pathways Analysis;
- The Technology Strategy Board’s Retrofit for the Future Project; and
- The Energy Technology Institute’s Optimising Thermal Efficiency in the Built Environment project.