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The Green Deal Mythbuster Help towards energy efficiency

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It's called the Green Deal. But in reality, it's a way of paying for the cost of double glazing, solid wall insulation, boiler upgrades and much more from the projected savings you'll make on energy bills.

It's complex, but for many living in England, Wales & Scotland it could pay off very well. This guide explains how it works, what it's best for, who should use it and more. If it's right for you, go quick. A new scheme's just launched offering funding of up to £7,600 to help offset your costs.

  1. The Green Deal gives special 'loans' or grants to improve your home to cut energy bills. You needn't be on a low income - anyone can apply

    Energy efficiency isn't just about group hugs, sandals and saving the planet. It can save you £100s each year on your gas and electricity bills and, just as importantly, make your home a more pleasant place to live in.

    The big idea is that the Green Deal helps you make energy-saving home improvements to your property, and you pay for it using the savings from your energy bills. You also get a snugger home.

    You can borrow money to upgrade boilers, install loft or cavity wall insulation and much more. Unlike many energy efficiency grants, it's not just for those on lower incomes (though more help's available if you are).

    Quick questions:

    Can I do the Green Deal if I rent my place?

    Can I do the Green Deal if I'm on a prepayment energy meter?

    What if I'm in Scotland or Northern Ireland - does it apply?

    Don't miss out on updates to this guide Get MoneySavingExpert's free weekly email

    A note from Martin

    The Green Deal is one of the Coalition Government's big ideas. The fact it has a political dimension, by its very nature, means some will say it's the best thing since sliced bread, others that it sups with the devil.

    We've tried to ignore that in this guide. The team and I have focused on the practical, financial standpoint: "Is it right for you?" For some, but not all, it is a very powerful deal that should be seriously considered.

    Just as in the Student Finance Mythbuster guide, the big fear factor comes from the fact much of the help's couched as an interest-charging loan, enough to frighten the bejeebees out of many people.

    Yet if you're debt-averse, don't just ignore it. This could be a great way to make your home a warmer, more energy-efficient place to live without any increased outlay.

    In truth, though, frankly I think the deal could've been structured slightly differently, with the same outcome. If no interest was charged, a mythbusting piece like this wouldn't be so necessary.

    Yet, of course, there is another element. If it does catch on (the jury's still out on that), it could help improve the UK's incredibly inefficient housing stock. In the long run, that's our only chance of cheaper energy bills.

  2. It's a debt, Jim, but not as we know it. For many, it won't ever increase their monthly costs

    It's been billed as a loan, which will, wrongly, put many people off. Yet it's not a debt in the traditional sense:

    • You pay back only what you're predicted to save on bills each month, so there's no NET cost. If your energy bills are £1,000 a year now, all being well (more on this later), your energy bills PLUS Green Deal repayments (including interest) won't be more than that. So there's no net increase in cost, and your home's more efficient.

    • It lightly credit scores. The credit eligibility criteria are less tough than normal lenders'. So more than 80% of people should get accepted – far more than for a normal loan.

    • Repayments are spread over a long term. The homeowner (that's you, unless you move, when it moves to the new owner) pays the money back over 10 to 25 years.

    • The energy company makes repayments for you. You don't actually repay the loan directly, your energy firm does it for you out of your electricity bills. So, just to hammer it home, that means you should pay at most the same as you do now, until the loan's paid off – then you'll feel the big benefit.

    What happens if I get into financial difficulties on my energy bills?

  3. You should never have to repay more than you 'save' in reduced energy bills

    This is the most important thing to understand. So let's labour it a little bit. You only have to repay what you're predicted to save on your energy bills each month.

    Imagine Mr Ivor Coldhome gets loft and cavity wall insulation costing £900. For his three-bed semi, it's estimated this'll knock £160 off his energy bills each year.

    Ivor takes a loan for £900 (plus a £63 admin fee) at 10.8% APR. His finance plan means he repays £108 a year for 25 years, after which his loan and interest is fully repaid.

    So with £350 cashback for installing home improvements through Green Deal, as his savings are more than his repayments, he's £401 better off in the first year, and £51/year after that.

    You repay through your electricity bill. So the idea is that your bills (you may save on gas or oil bills, not necessarily electricity) decrease enough to cover the repayments, so total energy bills stay about the same until the loan's paid off.

    So why is it 'save', not save? Because it's based on nominal, not real, savings

    In a perfect world, the saving would be based on the actual reduction in your energy bill thanks to the improvements. Yet that's impossible to work out, as so many different factors come into play to affect this.

    So the savings figure is based on average savings predictions, incorporating the following factors - though all use typical behaviour, not your own, to make the assessment:

    - What you're having done (eg, a boiler is different to double glazing)
    - Your home's size
    - The average occupancy for your size of home
    - Typical number of rooms not heated
    - Typical hours of heating used
    - Typical thermostat setting

    Your assessor will work out the average energy saving for a home of your type for that improvement. They'll then compare it to your usage – whether your heating's on for fewer hours, whether you live alone or have a brood of six.

    Assessors have been advised to make very conservative estimates of savings, as well as factoring in future energy price rises. This means for most typical energy users, if you do it right, the true saving's likely to be more than the repayments, so you'd be quids in. But if your usage changes, there's a risk it'll go the other way (see point 14).

    Check your advice report carefully. It'll tell you your average savings, so compare your energy use to those. It should also say if you're a low user, and could lose out.

  4. The Green Deal can be used for 40+ improvements, from double glazing and boiler upgrades to underfloor heating and loft insulation

    Cash is on offer for a plethora of energy-efficiency improvements, a bigger list than than under previous schemes.

    You could be eligible for one or a combination of the following. The only limit's how many improvements will be useful, and if they'll pay for themselves through Green Deal finance.

  5. To get the Green Deal, you need to pay an assessor about £120 to visit your home. So do a speedy home check-up first

    Okay, to be eligible for this, you're going to have to shell out upfront, annoyingly - though there's now £100 back through the Green Deal Home Improvement Fund if you then go on to install energy saving measures.

    The assessor comes to inspect your home and works out where, in an energy sense, it's leaking cash. (To see if it's leaking in a money sense, use our Money Makeover guide). They also check your energy bills, and ask questions about your usage.

    You should get your report a few days after the assessment. This'll flag up potential energy-saving improvements and how much you could save. Plus it'll highlight any extra subsidies you're eligible for (read more on getting it free).

    • Do a free speedy home check-up first.
      Don't shell out for an assessment before doing an online check first. The easy 'n' speedy way to see what improvements could help is answering a few questions on 1 Green Place's Home Survey tool (this is from an assessor organisation, so be aware it may contact you). If you get an assessment but don't qualify, you won't get your cash back.

    • It's not a fixed fee - some may do it cheaper.
      Assessors must be members of the Green Deal scheme. There are over 500 organisations to choose from. Some are nationwide, some are local outfits serving specific areas - search for an assessor near you.

      Costs for the assessment tend to vary from £99 to £150, but £120 is typical.

    Alert: Free Green Deal assessments in some areas
    Plus MSE Blagged: 10% of your annual energy bill back in cash

    One company, NWS*, offers free Green Deal assessments and an alternative finance plan to the Green Deal (it looks attractive on paper but it won't be best for everyone, so do your sums first).

    It's only available in South Yorkshire and the East Midlands - the S, NG, LS, HD, WF, LE, DE, LN, DN, HU, YO, HG and HX postcode areas.

    What improvements can it do?

    NWS is a certified Green Deal provider and installer, with qualified Green Deal assessors. It only offers 13 of the full 40 or so Green Deal improvements, but the ones it does are the most common, such as double glazing and insulation.

    It also installs free boilers and insulation via the Eco scheme - though ask it whether funding's available for this.

    What is its finance plan?

    NWS offers its own finance plans, called the Greener Deal. The APR is 6%, with no fees if you pay off the loan early, and the rate is fixed for a term of 10 or 15 years.

    And it is actually a loan, unlike Green Deal finance which isn't, strictly speaking.

    It has a lower APR than most Green Deal plans, though it's impossible to say if it's cheaper as that all depends on the savings you make to your energy bills via the Green Deal.

    10% cashback too

    We've also blagged cashback from NWS of 10% of your previous year's energy bill for the first 500 MoneySavers who agree a Greener Deal* plan with NWS. Before you agree anything, make sure you've compared the NWS offering to other providers to check it's cheapest.

    The NWS cashback's paid when the works are completed – and this is in addition to the Government's cashback scheme.

    We can't vouch for NWS's service or whether it'll try to sell you other products, so make sure you follow the checklist in this guide, the same as you would for any other provider.

    • Check whether your local authority has cash for assessments

      The Government often offers cash that local authorities can apply for to promote the Green Deal in their areas.

      In the past, this has resulted in local authorities offering free assessments. It's worth checking if your council has applied for a grant recently and seeing what it's doing to promote the Green Deal.

    • You may get the assessment cost back (twice)
      As mentioned above, the Government's Home Improvement Fund will give you £100 back toward the cost of your assessment if you then go on to install two or more qualifying energy-efficiency measures.

      But, many of the companies doing Green Deal assessments will also be able to install your energy-efficiency measures too. Often these firms will take the assessment fee off the cost of the work if you choose to do it through them.

      So you could get the assessment cost back twice (once from the Govt, once from the installer). But you're free to pick other companies too, so always compare prices.

    • Watch for the assessor trying to cross-sell you other products

      I can't afford the assessment - what do I do?

      How do I find a good Green Deal assessor?

      An assessor's just cold-called me. Is this legit?

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  6. Get up to £7,600 to help you improve your home

    The Green Deal has changed. Now the Govt's offering cash grants for solid wall insulation, double-glazing and more. A new scheme's launched, with up to £7,600 available per household for home improvements - though few will qualify for the full amount.

    The Green Deal Home Improvement Fund (GDHIF) launched in June 2014. It's open to householders in England and Wales who install Green Deal energy-saving measures.

    To qualify for any funding, the measures you're putting in need to have been recommended in a Green Deal assessment or Energy Performance Certificate (EPC) within the last two years. There are four main offers you could be eligible for:

    • Offer 1: Install two or more of 12 'main' energy saving measures, and get up to £1,000. This offer includes cavity wall insulation, boiler upgrades, double glazing, flat roof insulation and more.

      Provided your costs to install the two measures are £1,000 or less, you'll get the full whack back in funding. If, say, your costs were £800, then that's what you'd get back. The maximum GDHIF payout is £1,000, so if your improvement costs totalled £3,000, you'd only get a third of the costs back.

      Click to see a full list of the energy saving measures qualifying for £1,000 funding

    • Offer 2: Install solid wall insulation and get up to £6,000 back. Around 6.6 million homes in the UK have solid walls (as opposed to cavity walls). Solid wall insulation can be expensive, with quotes often ranging from £4,000 to £14,000. Funding's available for 75% of what you pay, up to a maximum of £8,000.

      Solid wall insulation could save you up to £460 on your energy bills each year.

      The offer applies to both internal and external solid wall insulation measures. MSE Wendy's taken advantage: "I'm getting 50m² of solid wall worth £7,100, but I only need to shell out £1,750." (She needs to pay £300ish upfront, and a further £1450 on Green Deal finance; her Green Deal Home Improvement Fund cash is a massive £5,350!).

    • 'Add-on' offer 3: Get £100 of your assessment cost refunded. Pretty straightforward, this one. Make improvements qualifying you for offer 1 or offer 2 above, and you can apply to get up to £100 of your assessment costs refunded (so, a vast majority of the costs.

    • 'Add-on' offer 4: A £500 bonus if you improve a home bought in the past year. If you've bought a home in the past 12 months, and choose to make it more energy-efficient under the Green Deal, then there's an extra £500 to help.

      You qualify for this £500 if you install measures in offer 1, or solid wall insulation under offer 2.

    Of course, there's the risk you pay for the assessment and don't qualify for any work eligble for GDHIF funding, so there's a net cost, but at that point, you could decide to go ahead anyway - you'd still have a warmer home.

    You need to apply for offers through your Green Deal plan provider before improvement work starts.

    For households on sub-£16,000 incomes, or anyone qualifying for solid wall insulation, check if you can get energy company funding to pay for the whole lot instead.

    Is this the same as the cashback scheme that was recently offered?

  7. The people who'll benefit most from this are higher users who live in cold houses and worry about turning the heating up

    Sadly, many people feel squeezed by heating costs, and cannot afford the simple home improvements needed to cut their fuel bills.

    If you live in a chilly house and worry about bills, it's worth considering. It should help you turn up the heat at less cost, or turn on the heat without panicking about the wallet impact. And because you'll use less energy, you'll be less impacted by future price rises.

    The Green Deal could also work for you if you're a high user already because then the likely savings you'll make from the improvements will outweigh your repayments and generate cash for you. Repayments are based on average use, so if you use more, your savings are likely to be bigger than your repayments.

  8. The loan is attached to the home, not you. If you move, the next owner pays.

    The loan is attached to your home's electricity bill, not you. So if you sell or rent it out, the new occupiers will make the Green Deal payments through their bills, in exactly the same way as you do.

    What will this do to my house price?

    It's still unclear. The Green Deal finance scheme is still in its early stages, so there've been only around 2,000 loans granted. It's unlikely that anyone who has taken the finance has tried to sell their home since the scheme started.

    However, Government research has shown that, for example, a home with a B energy efficiency rating fetches an average of £16,000 more than one with a D rating. It's likely double glazing and new boilers are top of many homebuyers' wishlists.

    Yet there is always the chance being tied to a 'loan' could frighten some. It may become a trend that people ask sellers to reduce the price of the property by the remaining cost of the loan, or pay the loan off in full.

    We asked an estate agent for their view of what buyers might think. Paul Masters, director at Kinleigh Folkard & Hayward, said:

    "Eco-conscious buyers may welcome energy-saving improvements and not worry about taking over the loan. But those who are already worried about loan repayments and getting a mortgage may be completely turned off and prefer to buy a property without it."

    When the scheme was launched, these loans came with early repayment charges, as you'd see on a mortgage. But, from May 2014, these have been dropped, so future loans can be paid off without penalty.

    I'm selling my house. How will buyers know I have the Green Deal?

  9. If you've got the upfront cash, you can still get the Green Deal without the loan, including 'cashback'. This can be bonza

    The loan is designed to help people who don't have the upfront cash to pay for improvements. Green Deal loans run for decades, and the interest costs can soon mount up. If you can pay upfront, you can avoid interest costs and bag the savings yourself.

    You don't have to take Green Deal finance to get Home Improvement Fund cash. But you still need a Green Deal Assessment and to do the work through a Green Deal provider, even if you're coughing up for improvements yourself.

    Overall, that's almost certainly likely to work out better for you (especially considering poor savings rates right now). But make sure you've done the maths - are you better off going through the Green Deal (with funding contribution, if applicable, minus cost of assessment) than you would be doing the measure outside of the Green Deal?

    If you do decide to do the work through a Greeen Deal provider, make sure you're not overpaying. You've still a got right to haggle with your Green Deal provider, as you would with any other tradespeople.

    We've worked up an example of how you could benefit from Green Deal Home Improvement Funding while paying upfront for cavity wall insulation and a boiler upgrade, and compared it to getting Green Deal finance.

    Paying upfront vs getting Green Deal finance (over 20 years)
    Paying upfront
    Borrowing the cash
    Cost of boiler, insulation and labour £2,500 £2,500 (plus £63 admin fee)
    APR - 8.6%
    Length of time to pay off - 20 years
    Repayment*/month - £22
    Interest cost - £2,780
    Total (re)paid £2,500 £5,280
    GDHIF funding £1,000 £1,000
    Predicted saving from lower bills* £5,280 £5,280
    Total saved over 20 years £2,780 £0
    *Assumes savings and repayments are both £22/mth

    Don't let the huge numbers put you off unnecessarily

    Talk of "borrowing £2,500 and repaying £5,300" may seem very scary. Yet again, it's important to remember, even with this, the whole point is you should not end up paying more than you do now, because the reduction in your energy bill will cover the repayments.

    You're also lessening the impact of future energy price rises. Suppose you use 3,300kWh of electricity. You then make Green Deal energy efficiency improvements, meaning you use 15% less electricity - 2,805kWh. If prices rise, you're less affected as you use less energy.

    It's also worth noting that, assuming we have overall inflation over the next 20 years, the actual cost to you of repayments is less. As inflation rises, the value of money diminishes, so £1,000 in 20 years' time will buy less than £1,000 now. This diminishes the cost of borrowing – to an extent.

    I don't have the cash upfront, but want to pay off quicker. Can I use other credit?

    Should I extend my mortgage to make home improvements?

  10. You borrow over the long term (10–25 years), and there is interest attached

    If you choose to get a Green Deal loan, the effective minimum repayment period is 10 years, the maximum 25. The exact length depends on the energy-efficiency improvements you choose.

    • This is unsecured borrowing (better than secured). When you get a loan from a Green Deal provider, you also sign an agreement for unsecured finance. That's better than secured, where they can take your house if you don't repay – here, they can't.

    • The interest varies depending on the amount and length of the loan, so check. Providers charge interest on Green Deal loans. Your Green Deal provider will set up a plan with you, though this will need to be approved by the Green Deal Finance Company - a central body set up to access the money markets and provide cash for the loans.

      The Green Deal Finance Company charges Green Deal providers 6.96% interest to borrow cash from it. They also charge a set-up fee of £63, and an annual charge of £20 per loan which is usually passed on and is the reason the APR (total cost of credit) that you face varies depending on the length of the loan and amount you borrow.

      Here are some examples of how much you could repay for different improvements (though the Green Deal Finance Company won't do finance plans for less than £500, so the first two are just for illustration):

    • You can pay Green Deal loans early without penalty. When the scheme was first set up, there were early repayment charges associated with loans that ran for 15 years or more.

      But the Green Deal Finance Company scrapped these in May 2014, meaning any loan taken out after that date, for any length of time, won't have these charges.

      If you're one of the 2,000 or so people who took out a loan before May 2014, then as these early repayment charges are in your contract with your Green Deal provider, you may still have to pay them if you chose to repay early.

      But the Green Deal Finance Company has said it'll encourage providers not to enforce these charges on anyone repaying early.

    Loft insulation (three-bed semi)
    Cost of work £350
    Predicted annual saving £150
    Interest rate 9.1%
    Typical payback time 10 years
    Monthly repayment (added to electric bill) £4.50
    Total interest cost £185
    Total repaid £535
    You save each year £100
    Cavity wall insulation (three-bed semi)
    Cost of work £500
    Predicted annual saving £145
    Interest rate 10.9%
    Typical finance payback time 10 years
    Monthly repayment (added to electric bill) £7
    Total interest cost £325
    Total repaid £825
    You save each year £60

    And one improvement that won't fully pay for itself...

    New boiler (three-bed semi)
    Cost of work £2,500 (plus £63 admin fee)
    Predicted annual saving £200
    Amount of finance borrowed £1,363
    Your upfront payment at start £1,200
    APR 9%
    Typical finance payback time 12 years
    Monthly repayment (added to electric bill) £15
    Total interest cost £870
    Total repaid £3,430
    You save each year £10 (until repaid)
  11. The Green Deal won't cover pricier repayments' entire cost - you may have to stump up some cash upfront

    If an improvement won't pay for itself in energy savings over 10 to 25 years, then you can't borrow the full amount through the scheme. So you'll have to stump up any remainder. Improvements that fully pay for themselves are denoted by a green tick on your assessment, those that only partially do have an orange tick.

    Typical areas where you may have to pay

    If you go for one of the pricier improvements allowed under the Green Deal – such as solid wall insulation, costing £10,000 or more – the energy you save over 25 years is unlikely to cover the cost.

    This is also likely to apply other more expensive improvements, such as new boilers, double glazing, solar panels, replacement storage heaters and under-floor insulation.

    Here, you can only borrow the amount you would save on your bills, and must cough up the rest yourself. So carefully work out if you can afford it beforehand.

    There may be help

    However, you can be clever here. If you combine a low-cost, high-impact improvement (eg, loft insulation), with a high-cost, average-impact improvement, (eg, boiler), you may be able to use the savings from one to pay for the other. See combining improvements for more.

  12. On a low income, in receipt of benefits? You may be entitled to free cash rather than a loan

    You don't always need to borrow. Launched alongside the Green Deal is the Energy Company Obligations (Eco) scheme. This gives grants to help low-income households, people living in older properties and low-income communities.

    However, we're hearing there are problems with Eco subsidies, with providers cancelling arranged installations and putting off new customers - so this funding isn't guaranteed. If you've tried to access it, let us know your experience in the discussion forum.

    The big six energy suppliers (British Gas, EDF Energy, E.on, Npower, Scottish Power and Scottish & Southern) have obligations to help customers by providing cash to help them insulate and better heat their homes.

    Don't worry if you're not with the big six. This isn't just about suppliers helping their own customers - these big beasts just need to put money into the system. Green Deal providers can then bid for it, and use it to help any of their customers who are eligible.

    Our Free Insulation & Boilers guide has full information, including eligibility criteria, for free energy-saving home improvements.

    Who's eligible for assistance?

    If you earn less than £16,000 household income and own your home, you're likely to be eligible for help. The amount you're eligible for is means tested. You're likely to get higher amounts if there are ill or disabled people, children or older people living there.

    For more info on help with costs and how to apply outside of the Green Deal, call:

    • The Energy Saving Advice Service (England & Wales): 0300 123 1234
    • Home Energy Scotland: 0808 808 2282

    How to get assistance under the Green Deal

    If you think you're eligible for help, and you want to take part in the Green Deal, discuss this when you get your home assessed for Green Deal improvements.

    Talk to your chosen Green Deal provider when you agree a plan. They will contact the energy companies for you, access any discounts you're eligible for, and take this off the total cost of your plan. Ask the provider if they have Eco funding available - it's becoming rarer that many do.

    Who is eligible for Eco subsidies?

  13. Everyone gets up to £6,000 to help with the costs of solid wall insulation

    Some 6.6 million homes in Britain – that’s almost one in three – were built with solid rather then cavity walls. Unfortunately solid walls are much more expensive to insulate – but the good news is that anyone with solid walls is potentially eligible for grants worth £1,000s.

    Solid walls are hard to insulate as, you need to add material either to the outside or the inside of a wall. It also costs a lot, from £4,000 for internal solid wall insulation and up to as much as £16,000 for external solid wall insulation.

    Getting internal solid wall insulation means sacrificing some room space. It can be done by building a fake wall and filling in the gap with insulating mineral wool, or installing insulation boards directly onto the walls. You'll need to remove anything attached to the wall, such as the radiator, or skirting boards - plus ensure it's free of damp.

    External solid wall insulation is done differently. A layer of insulation material is fixed to the existing walls, and then covered with protective cladding/render, which you can paint, add brick slips to, or even pebble-dash!

    Because this changes the external appearance of your home, you'll need to find out from your local planning authority whether you need permission, and, again, you'll need to sort out any damp you have.

    Because both types of solid wall insulation are so expensive, there's a decent amount of help on offer to assist you with the costs. There are two routes you can go down for help, and it's worth researching both as one may offer you more than the other:

    • Eco funding. As you read above, the big six energy companies have obligations to provide assistance to people trying to make their homes more energy-efficient.

      Although much of this cash will go to low-income households for new boilers & insulation, there's also help available for anyone wanting solid wall insulation.

      To find out what help you might be eligible for under Eco, talk to your assessor when they come round (assuming they recommend your home is suitable for solid wall insulation) or call The Energy Saving Advice Service (England & Wales) on 0300 123 1234 or Home Energy Scotland on 0808 808 2282.

    • Green Deal Home Improvement Fund. There's up to £6,000 help available under the Home Improvement Fund if you're installing solid wall insulation.

      You'll only ever be eligible for 75% of what you pay out, meaning that, to get the maximum help, your solid wall insulation would need to cost £8,000 or more.

    It's worth checking both schemes to see which will help you more - but remember, choose wisely, as you can't get help from both schemes. Talk it through with your assessor.

  14. If the savings you're predicted to make don't happen, you could pay more than you actually save

    This is a slight wobbler. I wouldn't let it put you off too much, but it is a risk that needs thinking through. Throughout this guide, we've written "you only repay what you should save", yet technically, that's not always true. The actual savings need to match up with your total repayments.

    Imagine Ima MoneySaver is a very low energy user living alone in a large house. If she got a new boiler, the average saving for a home of her type is £190 per year, so this is the figure used to set her repayments. She will pay back £16 a month until both the loan and interest is paid.

    However, she's a low user, and that isn't factored in (it's about the home, not the user, as if she moved the next tenant may be a high user). So she might only save £10 a month, because she uses less energy than the average. Therefore there would be a genuine net cost.

    Having said that, in time the saving should grow, simply because energy bills are rising so rapidly. If the saving stays at the same proportion, the cash amount would rise, so in a few years' time, she's likely to be saving as much as her repayments, and after that may even make savings over and above her repayments.

    All Green Deal assessors will ask to see your energy bills, classify you as a low, medium or high user, and predict your true savings. Your advice report will spell out if it's a good deal for you. Use these figures to work out if it's the right time to make home improvements.

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  15. Get at least three quotes for the work and don't be afraid to haggle (you only need one assessment). Many assessors and installers are salesmen - Green Deal double glazing is still double glazing!

    Picking a provider can be tricky. You don't need to get the work done by the same company that did the assessment.

    Get at least three quotes

    Once you've got your advice report, that's your assessment done. So now get quotes from at least three Green Deal providers. They will quote for the work and devise a repayment plan (if you don't want to pay upfront).

    Never be pressured into signing anything without getting other quotes first.

    Don't be afraid to haggle

    The installation and fitting industry has often operated by giving sky-high quotes to people, hoping they'll accept them, but being ready to knock them down if they become customers. We've heard of people being quoted £15,000 for double glazing but eventually getting it for £2,000 – showing the scale of the discounts.

    So far the Green Deal is too new for us to know how it will go, but don't be afraid to haggle (please report your Green Deal haggling experiences).

    Because this is a scheme based on the market, there are no Government rules on how much things should cost. So, as with any other home improvement, do some research to find out how much you should be paying, then compare quotes.

    If you've agreed finance, you don't pay your installer anything

    Once you've agreed on a quote, your provider will appoint an installer to do the work agreed under your plan. The whole idea of the Green Deal is that you can make improvements with no upfront cost.

    So, any Green Deal installer who tries to charge you anything when they do the work is wrong. It's worth checking when they arrive at your home that they're aware of the payment arrangements, and contacting your plan provider if there's a problem.

  16. Combining improvements can, bizarrely, make Green Deal loans more affordable

    The most important thing to understand on this is that you cannot borrow more under the Green Deal loan than what your energy savings will allow you to repay.

    So imagine you want to get double-glazing, not just for energy efficiency savings, but, say, to cut noise pollution. It's so expensive, the energy bill savings won't cover its cost in the maximum 25 years loan length, so you can only get a loan for some of the cost.

    However, now consider loft insulation and/or cavity wall insulation. These cover their costs in just a few years, but loans must be spread over at least 10 years, effectively leaving you spare borrowing capacity.

    So if you combine the two, you can use that loft and cavity wall insulation capacity to borrow more for the double-glazing, repaying quicker because of it.

    Though, of course, borrowing more means repaying more, and more interest (though it should be covered by an energy saving).

    The table below sets out an example, and should make it clearer.

    Double-glazing only Loft insulation, cavity wall insulation & double-glazing
    Installed cost £3,000 £4,000
    Annual efficiency saving £120 £415
    Amount of finance allowed £1,250 £4,000
    Customer's balancing payment at outset £1,750 None
    Finance payback time 25 years 20 years
    APR 8.9% 8%
    Monthly repayment £10 £33
    Total interest cost £1,870 £4,030
    Total repaid £4,870 £8,030
    Home Improvement Fund contribution None £1,000
    Customer's energy saving each year £0 (until repaid) £24 (until repaid)
  17. Even though you repay the bill through your electricity provider, you are still free to switch provider to cut costs

    Energy Club LogoRepayments are taken from your electricity bill (because not everyone has gas) and will be shown on your statement. Your electricity supplier will repay your loan for you to the company who installed your Green Deal measures to pay off your finance.

    Once a year, you'll receive a Green Deal statement from your provider that shows how much you've paid, and how much you still owe. Therefore, you're never shelling any separate cash out (apart from for your electricity bill, obviously).

    Yet you are still free to switch

    Don't, for heaven's sake, think this locks you into your energy provider so you can't get cheaper bills (join the MSE Cheap Energy Club to stick on permanently low prices).

    Provided the energy company is a member of the Green Deal scheme, which all the big six - British Gas, EDF Energy, E.on, Npower, Scottish Power, Scottish & Southern - are, then you are free to move.

    Switching will work no differently than it does now. There'll be a central Green Deal plan register, which means energy companies will know when you switch that there's also a Green Deal Plan to switch too.

  18. If it breaks after the warranty runs out, you may still have to repay

    Most Green Deal equipment comes with a five-year warranty for the equipment, and 10 years' warranty for any building damage caused by the installation. Cavity and solid wall insulation have a full 25-year warranty.

    Many Green Deal improvements have extremely lengthy repayment periods. So if your new boiler breaks in year eight, its warranty will have expired. You'll need to pay to fix it, but you'll also still have to pay your Green Deal provider each month.

    Some Green Deal Plans require you to get annual services on the improvements or risk invalidating the warranty – another thing to check when agreeing a plan. This is a good thing because you'll still have a warranty, but the service will probably cost you.

  19. The Green Deal has STRONG consumer protection rules. If you're given the wrong advice, take it to the Ombudsman

    green dealThere's a lot of consumer protection around the Green Deal. Green Deal providers, assessors and installers have all signed up to a Code of Practice, and all Green Deal home improvements should have the Green Deal Quality Mark.

    Green Deal assessments in your home are covered by door-to-door selling regulations, which mean you have seven days to change your mind. Even so, NEVER, EVER sign up to anything on the spot - take your time to think about it.

    Some installations may need additional work - eg if you're getting underfloor heating, you may need a joiner to take up/replace the floor, as well as a heating engineer to install the heating pipes or electricals.

    The Green Deal Code of Practice requires that any other tradesmen involved who aren't Green Deal Installers are members of other schemes, such as TrustMark.

    How to complain

    Various ombudsmen and regulatory agencies deal with complaints, though your first port of call should be your provider. If they can't resolve your complaint, contact the Green Deal Ombudsman or, in specific cases, other bodies:

    • Problems with the Green Deal: You can complain to the Green Deal Ombudsman or call on 01925 530 263.

      The Ombudsman has the power to investigate complaints and decide whether to take action. It can require energy companies to remove charges, or provide a service. They can force providers to give an apologies or explain, and, if appropriate, give up to £25,000 compensation.

      If you accept the Ombudsman's decision, it's binding on you and the company. If you don't accept it, you're free to pursue other redress, for example, through the courts.

      If a service was mis-described, you may want to get your local Trading Standards Institute involved.

    • Problems with energy companies: You can report the energy company to its regulator, Ofgem. It builds cases against energy companies, and fines them for large-scale mis-selling or unfair relationships. If you have a specific complaint, it's best to go to the Green Deal Ombudsman above.

    • Problems with your Green Deal finance contract: If your complaint directly regards the Consumer Credit Act, rather than a company's conduct, you need to seek help from the Financial Ombudsman Service or call it on 0800 023 4567.

      However, if your complaint is regarding how your repayments are being taken, for example, you should go to the Green Deal Ombudsman.

  20. The Green Deal's a big move. First ensure you're on the cheapest energy tariff and do the energy-saving basics

    Ditch and switch energy provider and you can £100s a year. Our Cheap Energy Club checks you're on the cheapest deal and handles the switch for you. Plus to encourage you, there's usually up to £30 extra if you switch via the club.

    It's the same gas, the same electricity, the same safety. All that changes are the customer service and the price you pay.

    And every month, without you doing anything, we do a comparison for you, and alert you when it's worth switching again.

    Once you've switched, if you wander round the house in boxers or bra 'n' knickers with radiators on full and windows wide open... STOP IT!

    Sensible changes can save your large, from draft excluders to setting washing machines to 30°C and low-energy light bulbs to notching down the thermostat. Try the Energy Saving Trust for more energy-saving tips.

    Martin's final thought - is it worth it?

    That's the mythbusters done, so hopefully you now understand how the scheme works.

    Deciding whether it's right for you depends on your home and finances. From a purely financial perspective, provided the work qualifies for full financing, it seems a good bet for those keen to improve their pads who can't afford to shell out upfront for major improvements.Martin Lewis, site founder and editor

    The simple reason for this is that your home will be a nicer, warmer place to live in, even though you won't have to pay out any more than you do now. But if you can afford to shell out upfront, then it's likely better to do this, so you don't pay any interest costs.

    For smaller improvements the assessment's cost is proportionately larger, so needs factoring in more. Though, right now, with cashback on top, that should be more than covered, making that simple too.

    Those are the easy bits though. This is a new-ish scheme and there are still many unknowns, even though we're now more than a year in. We don't know what impact this'll have on house prices, for example. So there is still an element of a gamble.

    For more on the Green Deal see Martin’s blog: How to make the Green Deal more popular.

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