“Green loans” offered to homeowners under new government scheme

The government has announced plans to offer “green loans” to homeowners in order to help them make their homes more energy efficient.

Homeowners can use the loans to purchase solar panels or other new technologies which generate electricity and the spread the initial costs over a number of years. Alternatively homeowners can also use the money to kit their homes out with better insulation which will cut their energy bills in the long term.

Ed Miliband, the Energy Secretary, has claimed that by 2011 around six million homes will be insulated using the new ‘Green Strategy’. The scheme hopes to insulate all lofts and cavity walls (where possible) by 2015 and offer eco-upgrades to more than seven million households by 2020.

The Green Strategy is part of a larger scheme initiated by the government to cut down the amount of greenhouse gas emissions by 29 percent by 2020.

Under the scheme the green loans will be tied to the house, rather than an individual, and the payment period will be prolonged so that the cost is outweighed by the long term reduction in energy bills.

"It is imperative that information provided to consumers on the true costs of installation, expected lifetime, anticipated maintenance costs and savings achieved, together with the impact on property value, are clear, impartial and objective.” said Barry Hall, a spokesman for the Royal Institution of Chartered Surveyors.

"For consumers to buy into such measures, they must have confidence in the advice, the products, their installation, and the supporting financial information provided." He added.