A group of businesses have formed a collective to work with government to help finance the Green Deal. The Green Deal Finance Consortium will provide finance to all Green Deal Providers by accessing the cheapest sources of finance in the market at the highest possible credit rating.
The Department of Energy and Climate Change say the Green Deal will be the biggest home improvement plan since the Second World War, helping to insulate people against rising energy prices and creating homes which are warmer and cheaper to run.
Energy Secretary, Chris Huhne said: “This is an exciting initiative with the potential to reduce interest rates on Green Deal finance, while also supporting healthy competition amongst Green Deal providers including small businesses. New firms like the Green Deal Finance Company are testament to the attractiveness of the Green Deal framework and its potential to offer a better deal to consumers.”
The Green Deal will allow private firms to offer all UK consumers energy efficient improvements to their buildings. Consumers will pay back the cost of improvements through the resulting savings in their energy bills. The Green Deal’s flagship policy is that savings on bills will exceed the cost of the work, theoretically resulting in customers getting energy savings for free.
Paul Davies of PricewaterhouseCoopers, lead partner on The Green Deal Finance Company, said the group had formed to help drive down costs: “By minimising the cost of finance to future accredited Green Deal providers, it will create a highly competitive market that will compete on cost, reliability, lifespan and technology. It will maximise the measures that can be included within the Green Deal and for many potential providers will solve the question of where their finance will come from.”
Paul Williamson, head of customer markets controlling at npower, which has also joined, said the consortium would benefit business: “Many questions of the Green Deal still remain unanswered, such as customer uptake, financing and implementation. This is why the Green Deal Finance Company business plan is crucial to the success of the Green Deal.”
Members of the GDFC include British Gas, Carillion, Clifford Chance, E.ON, EDF Energy, Goldman Sachs, HSBC, Insta Group, Kingfisher, Linklaters, Lloyds Bank Corporate Markets, Mark Group, npower, PwC, RBC Capital Markets and SSE.