Labour would scrap 'failing' Green Deal

A Labour government would scrap the Green Deal and its sister scheme the Energy Companies Obligation and replace it with alternative ‘Energy Save’ scheme, Building has learnt.

Labour sources confirmed that the party would launch a consultation on replacements for the government’s flagship retrofit programmes in the coming weeks.

A Labour Party source said: “The Green Deal is obviously not working so we will be consulting on what to replace it with. At the moment the Green Deal is not working and ECO [the Energy Companies Obligation aimed at vulnerable people] is not reaching the right people.”

However, the source stressed that Labour was not abandoning a commitment to retrofit and wanted to devise a new scheme, in consultation with industry, that would work better.

The source said the ECO was too bureaucratic for energy firms, while only 12 households had completed Green Deals to date.

“We want to find a better way to support retrofit,” the source said.

“We will work with the market and with industry to find a better way.”

The latest Green Deal figures showed just 12 Green Deals were ‘live’ at the end of August - meaning the retrofit measures were completed and the customer was now paying off the cost of the work through their energy bill.

A policy review published by Labour yesterday said the Green Deal was “woefully inadequate” and the party would replace the scheme.

It said: “The Green Deal is failing to deliver. Since its launch, only 384 deals have been signed up to and just twelve have gone live. This is woefully inadequate so we will overhaul the Green Deal and replace it with a new Energy Save scheme to help reduce the energy we use.”

Paul King, chief executive of the UK Green Building Council, said Labour’s policy risked creating further uncertainty. “It’s no secret that the Green Deal is off to a tough start, but talk about ‘replacing’ it risks causing further confusion and lack of confidence in the construction sector,” he said.

“For businesses out there trying to deliver energy efficiency and for householders considering getting a Green Deal right now, they need reassurance that this is more about improvement and continuity.”

“Loans that can be attached to the property, paid back through savings on energy bills, will always have to be part of the solution. Labour are right to look at reducing the interest rate, but even low costs loans will not work without additional incentives to nudge people into action.”

The policy move comes after shadow energy secretary Caroline Flint slammed the low take up of the Green Deal in her speech to the conference today.

Flint said: “It was meant to be the biggest home improvement programme since World War Two.

“Ministers said they’d be having sleepless nights if 10,000 people hadn’t signed up by this Christmas.

“They’ve spent £16 million promoting this scheme so far. But just 12 households have had any work done. £16 million for 12 homes. Only nine thousand nine hundred and eighty eight to go. They won’t be getting much shut eye this year.”