Is the Green Deal a Good Deal for UK Businesses?

Businesses across the United Kingdom are struggling to maintain cost savings that improve competitiveness in the market, while remaining mindful of the operational impact on the environment. Green initiatives are taking place across the country, with businesses encouraged (and often legally required) to lower their carbon footprint through the minimisation of greenhouse gas emissions, introduction of energy-efficient equipment and machinery, and lower paper waste.

The question now facing companies is simple. is the government’s Green Deal a good deal? Below you’ll find information about problems that have plagued the program, as well as efforts the government has taken to correct them. In the end, you will learn how to lower your business energy costs, while meeting the requirements of the Green Deal.

The Green Deal - UK Legislation

What is the Green Deal?

According to The Startup Magazine, the Green Deal is “a government legislation which helps both homes and businesses reduce their carbon footprint.” The goal of the program is to help lower energy consumption in private buildings and commercial enterprises across the UK, aiding the country in meeting its strict targets for carbon reduction while realising cost savings for homeowners and business owners.

Realising Business Energy Savings

By upgrading the physical structure of your business, you can enjoy cost savings throughout the year within an upfront payment. The primary area of focus has been on installing new or upgrading existing insulation. Many structures in the UK lack solid-wall insulation. In addition, many small business owners often overlook roof insulation in their structures.

Additional means of lower energy costs include the following upgrades:

  • Heating Improvements: Adoption of modern heat pumps.
  • Windows and Doors: Double-glazing windows and adding draught-proofing insulation around door frames prevents air from seeping into a building, while keeping more heated/cooled air inside the structure.
  • Renewable Energy: There has been a massive push in the UK and around the globe to adopt renewable energy sources. In the Green Deal, the primary focus has been on the adoption of solar energy.
  • Additional options in the UK include off-shore and on-shore wind farms.

Before you can upgrade your business, you must go through an assessment to determine which features your business should focus on first, and whether or not those changes will make a difference in the long term.

How Assessments Work

You’ll need to have your assessment performed by an assessor who has been approved to work on the Green Deal program. The assessor will determine whether changes in cavity wall insulation, heat pumps, and/or solar panels will make a difference to your business. After the best approach has been identified, the green assessor will provide you with instructions for moving forward.

At this point, you can contact a Green Deal provider to assist you in moving forward on your upgrades. Green Deal providers complete all upgrade work without an upfront payment, which means you can upgrade now and pay the provider back over time in installments. This allows you to save money now, while paying off the work over the long term.

Solar panel installation
photo credit: Brian Kusler

Problems with and Solutions to the Green Deal

The Green Deal program was beset by issues from the first day. Among the many problems, as cited by The Guardian, the registration website was marred by IT difficulties that prevented individuals from accessing the site and applying for vouchers. On top of that, the Department of Energy and Climate Change (DECC) reported that the £24 million fund set aside to support the initiative’s cavity wall insulation program had already been exhausted in a matter of hours.

This followed issues with funding during the summer of 2014 when DECC shut down the first phase of the Green Deal after £120 million worth of vouchers were claimed by businesses and homeowners in a matter of weeks.

The UK government has taken action to prevent these issues from slowing the pace of green change across the country. DECC is already releasing a new round of funding, with £100 million in vouchers freed up in December 2014. Another round of funding is expected to come from DECC as early as February 2015.

Money is still available, and according to the government, will continue to be available for businesses hoping to realise cost savings through energy improvements. If you fail to obtain a voucher for insulation, heat pump, or solar energy improvements, you can still work to upgrade the energy efficiency of your business through other means. Numerous private entities are working to provide businesses with affordable solutions to energy woes.