The Green Deal: Are we back at square one?

It’s crunch time for the Green Deal. Last week, the government closed its £120m incentive scheme for the Green Deal because it had become inundated with applications for money after the government raised the rates homeowners could claim.

The government harboured lofty ambitions of creating a self-funded market for energy efficiency when the Green Deal launched in January 2013 and, most importantly, of moving away from funding this work itself. But the Green Deal struggled to attract customers and, prompted in part by construction industry pressure, the government resorted to a simple cash incentive scheme to try and get it going.

Now that the money has run out it seems unlikely that anything will replace it, even if there are fiscally neutral options for creating “structural incentives” to take up, such as changes to council tax.

So, the industry is, to a large extent, back in the position it was in January 2013. That was a time in which many businesses closed and thousands of people lost their jobs because of a lack of customers for the Green Deal - people are understandably nervous.

But there has been much more customer interest in the Green Deal (driven by the incentive scheme) in recent weeks than there was in January 2013, which was all the limited pot of incentive money was ever going to provide. The sector needs to find a way to capitalise on that to grow the market.

If it doesn’t, it’s likely pleas to MPs to revive the Green Deal for a second time will find few sympathetic ears.

Vern Pitt, senior reporter