Green Homes Grant: What is it?
The Green Homes Grant will provide homeowners with vouchers for energy efficiency improvements, in which the government will cover two-thirds of the cost
Vouchers worth up to £5,000 will be issued to homeowners in England to make their homes more energy efficient under a new Government scheme that launches in September. We don't yet have full details about how the new scheme will work though – see what we know so far below. As part of the Green Homes Grant scheme, eligible homeowners will be able to use the vouchers to help pay for environmentally friendly improvements such as installing loft, floor and wall insulation or double-glazing. Chancellor Rishi Sunak outlined the plans, which will see the Government put aside £2 billion for green home upgrades, as part of his economic statement on Wednesday. For more on the help you can get with energy efficient improvements, see our Free Insulation and Boiler Grants guide. Plus for more on the other big announcements in the Chancellor's statement, see our Stamp duty cut and 50% off discounts when eating out MSE News stories. How will the Green Homes Grant work? The idea is that the Government will give homeowners in England vouchers towards the cost of energy efficient improvements, which should cover much – and in some cases all – of the cost. You'll have to apply for a voucher once the scheme is up and running in September. You'll then be able to spend it to improve your home. The aim of the scheme is to help homeowners and promote energy efficiency, but also to help boost the economy during the coronavirus pandemic by creating jobs. The Green Homes Grant applies to England only – so unfortunately won't cover homes in Scotland, Wales or Northern Ireland. What will the vouchers cover? The Treasury says the vouchers can pay for "green improvements such as loft, wall and floor insulation", while Business Secretary Alok Sharma has indicated that double-glazing will also be included. The Government hasn't yet given a complete list, so other improvements may also be covered – though MSE founder Martin Lewis has had a tip-off that it's unlikely new boilers will be included.
We'll update this story when we have full info. How much will the vouchers be worth? For most homeowners, the vouchers will be worth about two-thirds of the cost of the energy efficient improvements, up to a maximum of £5,000 per household. For example, the Treasury says a homeowner installing cavity wall and floor insulation costing £4,000 would only pay about £1,320, with the Government contributing the remaining £2,680 through the voucher scheme.
But those on low incomes will be able to get more – in that case the Government will cover the full cost of the energy efficient improvements, so you won't have to pay anything, and the vouchers could be worth up to £10,000 per household. Of course, green improvements such as insulation can also help cut your energy bills, with the Government saying families could be able to save hundreds of pounds a year as a result.
Will anyone be able to get these vouchers? That was the impression given by the Chancellor in his speech, but details are still scant. Here's Martin's view: "I've been told there won't be any qualifying income on getting the main vouchers, so every homeowner and landlord is likely to be eligible. However, whether every home will qualify is still up in the air. "With the Green Deal (a similar type of scheme a few years ago from the Coalition Government) you had to have a pre-qualifying inspection – and the inspectors decided what your home was suitable for.
My totally unsubstantiated guess is that it is likely there will be some form of pre-qualification assessment here. It may also be that they dictate what your home needs. For example, for those wanting double-glazing, you may be told that it needs to be part of a package with floor insulation." The Treasury has said it hopes the scheme will help pay for improvements in over 600,000 homes across England – so the vouchers should be fairly widely available.
The boosted £10,000 vouchers, where households won't need to pay anything towards improvement costs, will be for those on the lowest incomes – but again, we don't know what the threshold or exact eligibility criteria are at the moment. We'll update this story with more details when we have them.
How can I apply for a voucher? The scheme is set to be launched at some point in September, and homeowners will be able to apply online at this point. Homeowners will be shown energy efficiency measures which the vouchers can be used for, and recommended accredited suppliers.
Once a supplier has provided a quote and the work has been approved, a voucher will be issued. The Government hasn't said how long it could take for an application to be approved and a voucher issued, however. We'll update with more details of the application process once they're available.
Will any firm be able to do this – or is it just specific installers? The Government has said households will be able to spend the vouchers with "local accredited suppliers", but hasn't yet given details on which firms could be part of the scheme or what the criteria would be. However, Martin says: "With the predecessor to this scheme, the Green Deal (a rather convoluted scheme that involved getting a loan if you wanted the state subsidy), there was a specific list of qualifying installers. My guess is there will be something similar here. "The nature of that meant that negotiating with suppliers was more difficult and in some cases prices were inflated. Even so, with two-thirds paid by the Government this should work out substantially cheaper." I was planning to order insulation or double-glazing now – should I wait? Martin says: "It's worth being aware, as explained above, that there may be an assessment needed to get these vouchers – and not everyone may be able to get what they want.
We're expecting more details on the scheme in due course so it's probably a sensible idea to hold off making a decision until then when we know more. We'll put the details in the free MSE weekly email as soon as we know. "Be aware that this is likely to be a nightmare for the installers and sellers of these products.
We've just come out of lockdown, they're trying to kick-start their businesses, and the Chancellor has pre-announced an uncertain scheme that will likely stall people ordering. So please do what you can to behave ethically, if they've helped you, try to reward their service, when and where you can."
The Green Homes Grant
was introduced in July 2020 by chancellor Rishi Sunak to help homeowners make their homes more energy efficient. It is set to launch in September 2020. The announcement of the Green Homes Grant followed a fraught spring for the UK economy, which contracted by 25% amid the coronavirus pandemic. The Green Homes Grant was one of the major updates in the government’s Summer Statement — laying the foundations for a green recovery. Once launched, the government will pay two-thirds of energy-efficient home improvements up to £5,000. As well as planning to create thousands of new jobs, the government believes the scheme will help the UK meet its 2020 target of achieving net zero carbon emissions. Here’s what we know so far.
What is the Green Homes Grant?
The Green Homes Grant scheme will provide £2bn for projects such as ensuring houses are properly insulated. This is part of a wider £3bn plan to cut carbon emissions. The grants will be provided in the form of vouchers which can be used towards making energy-efficient improvements to
homes. The Treasury claims that utilising these vouchers could save families up to £300 a year on energy bills, although it is not clear how this has been calculated. Sunak confirmed that the average annual saving will likely be in the region of £200. How Does the Green Homes Grant W
ork? In order to obtain a voucher, homeowners will have to make an online application for recommended energy efficiency measures, with details forwarded to accredited local suppliers.
Once one of the suppliers has issued a quote, and the requested work has been approved, then the government will issue the voucher towards the work.
Who Can Apply for the Vouchers?
The chancellor revealed that both homeowners and landlords would be eligible in his statement, but we await further details. The chancellor confirmed that up to 650,000 homes will be covered by the grant. How Much are the Vouchers Worth? Under the scheme, the government will pay at least two-thirds of the cost of home improvements that save energy, up to £5,000. For example, if you were to have a new, more energy-efficient boiler installed for around £2,000, then the government would contribute around £1,333 and the homeowner would pay around £666. The poorest households will be eligible to receive up to £10,000 towards these improvements. And these poorest homeowners will not have to contribute anything to the cost.
What Does the Green Homes Grant Cover?
Homeowners will be able to spend these vouchers on a myriad of improvements, including: Loft and floor insulation New, more efficient boilers Heat pumps Energy-efficient lighting Double or triple glazed windows Energy-efficient doors When Will the Grant be Available? Applications for the scheme will open in early September 2020.
How Can I Claim Green Homes Grant Vouchers?
From September, it will be possible to apply for the grant online. We'll be updating this page as further details become available.
What Else Should I Consider?
While the vouchers will provide a much-needed boost for low-income households, the £5,000 cap - or £10,000 for the poorest homeowners - may not be enough for certain energy efficiency improvements to be made. For example, external wall insulation on a three-bedroom house is likely to cost in the region of £10,000, while a larger detached home will cost £8,000-£15,000. Vouchers up to the value of £5,000 will not cover two-thirds of the costs in these instances. Architect Paul Testa from Paul Testa Architecture and contributor to Homebuilding & Renovating magazine, said: “The scheme is going to be great for really poor households, who will be able to get a boiler replacement or cheap double glazing, and this will provide immediate relief. But all this will do is lock in poor performance for longer. It’s forcing people to go down the cheapest route”. Reaction to the Green Homes Grant
News of the Green Homes Grant scheme was welcomed by business groups and industry leaders alike. Brian Berry, chief executive of the Federation of Master Builders (FMB), said: “This is very good news, signalling both an important step towards building back better and greener, and a vote of confidence for local builders up and down the country.” However, industry experts fear the scheme could yet exacerbate the problems facing households if the work is not undertaken correctly. David Hilton, director of Heat and Energy Ltd and contributor to Homebuilding & Renovating, agrees that while the scheme could prove significant for some households, it could yet prove problematic. “I welcome the move and anything that supports homeowners to make their homes energy efficient is of course a good thing,” said Hilton. “However, knee-jerk reactions can be problematic, and these vouchers might not have a lasting effect if the scheme is not rolled out properly. “For example, I’ve seen problems with poorly fitted insulation. If you therefore use these vouchers to install internal insulation but you do not fix external problems, then it will not have a lasting effect. And who will ensure this is done properly?" Details are sparse as to how the scheme will be regulated, and Mike Fairman, CEO of Checkatrade, agrees that it will be essential to hire only experienced and vetted traders to carry out home improvement projects. “We welcome this move from the government to help bolster the trade economy, through the promotion of energy saving home improvements. However, homeowners should be wary of cowboy builders and traders who don’t have adequate experience, who will be looking to profit off this initiative,” said Fairman. Get updates from all sorts of things that matter to you
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