Green Deal is good for renewables
By Pippa Wibberley | 14 Jun, 2010
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Pippa Wibberley welcomes the Government’s commitment to green refurbishment, which could help absorb the upfront costs of investing in renewable energy technologies.

Plans for a new energy bill were announced in the Queen’s Speech on 25th May, in which the Government has outlined the proposal for a green investment bank that would loan households money to make their homes greener. While the exact figures available to homeowners haven’t yet been confirmed, it is thought that the loans could be around £6,000 to 10,000.

This Green Deal would obviously be a huge boost to householders by absorbing the upfront costs of switching to a renewable energy heating system. The plan is being seen as a pay-as-you-save scheme, in which the loan repayments are made using money saved through lower energy bills. This can only be good for the renewables industry.

Even though the future of the Renewable Heat Incentive (RHI) – as proposed by the former Labour government – has not yet been confirmed, should the proposed Green Deal successfully become legislation in the new energy bill, it could have real power to drive the uptake of renewable energy technology.

LCBP funding
Although the early closure of the Low Carbon Buildings Programme (LCBP) was a cause of some disappointment initially, its early closure means only £3m has been cut from the programme overall, while £63m of applications due for payment in 2010/11 will not be affected.

Where grant offer letters have been issued, or where applications are being considered by BRE, these applications will still be honoured. So in reality the impact of these cuts is quite small compared with the already installed renewables capacity created by the 20,000 installations, under the LCBP grant system.

We’re obviously keen to see that the LBCP is replaced rapidly by a new package of financial support through the Green Deal for the uptake renewable energies – and the RHI could play an important role in this. Whatever the case, it’s clear that the Government now has the ideal opportunity to create a better future for businesses and the environment by supporting the adoption of renewables, which offer a sustainable solution for heating our homes.

Future obligations
This month, the UK has to submit a national action plan to the European Commission as part of the Renewable Directive, detailing how it will meet its obligations. So there is a very real imperative for the Government to either continue to support the RHI, or bring in even swifter measures to help the UK to meet its legal obligations in Europe, as well as rising to the challenge of creating a greener economy.

With the continued likelihood of austerity measures to reduce the budget deficit over the next five years, air source heat pumps provide very strong benefits to all households in terms of lower running costs and reduced vulnerability to fossil fuel price rises, especially in off-gas areas.

For the social housing sector, which will still have to meet stringent carbon reduction targets and will have to continue to tackle fuel poverty, environmental and energy-saving drivers will remain stronger than ever – whatever financial subsidy framework the Government ultimately creates.

Pippa Wibberley is director of heating at Daikin UK. For further information visit www.daikin.co.uk.



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