Pay As You Save scheme unveiled to spread cost of greener living in our homes over decades

By Susie Weldon
Mar 3, 2010

Saver: Solar Panels such as these could be paid for over decades via the government's new Pay As You Save scheme

By Susie Weldon

A ‘green loan’ scheme which allows people to pay for energy-saving measures such as solar panels after they’ve had them installed, rather than before, has just been announced by the Government.

The scheme — dubbed Pay as You Save — ties the cost of installing energy-saving eco measures to the home instead of the individual, allowing payments to be spread out over decades.

The loan is passed on with the house when it is sold, enabling householders to reap the long-term benefits of a more energy efficient home and lower bills. Spreading payments over 25 years could, in the case of installing solar thermal panels, save a householder £170 a year, the Government said.

Energy and Climate Secretary Ed Miliband said it would bring the cost of solar panels, insulation or other green measures within the reach of many people, removing “the deterrent of upfront costs” and reducing “the hassle” of the move to greener living.

He added: “Making homes more energy efficient will help protect people from upward pressure on bills, tackle climate change, and make us less reliant on imported energy.”

The move is part of the Government’s new Warm Homes, Greener Homes Strategy aimed at bringing about a green transformation of Britain’s homes over the next decade — making them more comfortable, warmer and cheaper to run.

With around one quarter of UK emissions coming from energy used in homes, the aim is to cut emissions from the UK’s homes by 29% by 2020. The strategy includes:

• insulation for 6 million homes by the end of 2011;
• insulation for all practical lofts and cavity walls by 2015;
• the offer of eco upgrades for up to seven million homes by 2020;
• all homes to have smart meters;
• the creation of up to 65,000 jobs to install and manufacture energy saving measures or provide home energy advice;
• a new set of standards for workmanship and products to protect consumers from the threat of cowboy eco-builders and dodgy products;
• £2.5m for a network of Green Show Homes across England, lived in by ordinary people and open to the public;
• plans to consult over minimum energy efficiency standards for rented property to help tenants left in poorly insulated, cold and energy wasting properties;
• a new ‘Warm Homes’ standard for social housing with all social tenants receiving free energy upgrades from energy companies, including fitted smart meters, leading to savings of up to £300 a year on bills;
• proposals to overhaul the scope of Energy Performance Certificates, to give householders a better understanding of what they can do to improve the energy efficiency of their homes.