7 English cities grab £12m for 'cash back' Green Deals

Seven English cities will receive a share of a £12m funding package to allow them to support and test the launch of the government's flagship Green Deal programme in their regions, the energy secretary has announced.

Edward Davey said that the funding would enable the cities, each of which received devolved growth powers as part of the 'City Deals' announced by the government earlier this year, to test and provide early feedback about important elements of the programme. The cities are: Birmingham, Bristol, Leeds, Manchester, Newcastle, Nottingham and Sheffield.

"These cities have really ambitious plans to lower their emissions, reduce energy use and help people save money on their bills," he said. "I've been really impressed by their plans to start testing the Green Deal and transforming our homes and buildings. This funding will help them get up and running, and I look forward to seeing a number of properties across whole communities get the energy efficient improvements they need."

Under the Green Deal, property owners will be able to install energy efficiency measures such as insulation or double glazing at no up-front cost, with the repayments met through an additional charge on energy bills. It will be introduced to householders from October this year; however, in April, the government admitted that the launch for the non-domestic sector would be delayed to ensure that industry concerns about the "complex" scheme were fully addressed. In addition, the finance to fund improvements to domestic properties will not be made available until January 2013.

Funding from an older pot

Energy law expert Linda Fletcher of Pinsent Masons, the law firm behind Out-Law.com, pointed out that the announcement was not an indication of new funding for the scheme.

"This £12m is coming from the £200m which was announced last November by the government as funding it was putting towards the scheme – since then, we have not heard how that was to be applied other than the reference to this possibly taking the form of a simple 'cash back' for consumers if they were early adopters of the scheme and which would be a one-time payment," she said.

"We also had the announcement in August that the government is to provide a £7m loan to the Green Deal Finance Company, which is expected to begin offering low-cost finance to consumers from early 2013. Again, although welcomed, this is still a lower level of support than the £40m in funding that had been called for."

Fletcher added that although the government was making a lot of "noise" about the scheme in the run-up to its domestic launch in October, what is still needed is clear guidelines and action - particularly with regards to the delayed timetable for the launch of the scheme for commercial properties.

"The cost of finance will be key to the Green Deal being a success," she said. "In addition what is still awaited is when the scheme will be launched for commercial properties or at least proposals as to how the Government plans to deal with the complexities of retrofitting multi-tenanted premises."

The cities awarded a share of the funding - Birmingham, Bristol, Leeds, Manchester, Newcastle, Nottingham and Sheffield - have each put forward proposals to lower their carbon emissions, with funding allocated by population and adjusted based on the nature of the proposals. Each city will also generate funding to match that provided by the government, or provide direct support.

According to the government, proposed projects include retrofitting properties across whole communities with energy efficiency measures. Around 2,500 retrofits will be carried out on domestic and commercial properties across the seven cities, it said.

The seven cities, plus Liverpool, were each awarded bespoke powers to stimulate economic growth and create jobs as part of the government's 'City Deals' programme; the agreements for which were signed last week. By granting devolved powers to these 'core cities', representing the biggest population centres outside of London, the government estimates that 175,000 jobs and 37,000 new apprenticeships will be created over the next 20 years.

Copyright © 2012, Out-Law.com

Out-Law.com is part of international law firm Pinsent Masons.