The following scenario shows how you can take Green Deal Finance to fully pay for a measure (green tick on the Green Deal Report) and the total benefit from doing so. Note: the numbers have been adopted from an example provided on the Department of Energy and Climate Change website.
Green Deal Finance for Loft and Cavity wall Insulation
The example below assumes the financing is taken out for a 3 bed semi-detached property:
| Insulating your loft and cavity is estimated to save each year | £159 |
| Golden Rule says max repayment on electricity bill in year 1 should be | £159 |
| Assume typical cost of the work | £900 |
| Assume 25 year Green Deal finance loan @interest rate | 10.9% |
| After taking interest plus cost of job over 25 years: | |
| Annual repayment added to electricity bill | £106 |
| Customer better off with the savings | £53 |
| Customer also receives cashback for each measure installed | £350 |
| Total customer benefits in year 1 (bill saving + cashback) | £403 |
Total 25 year net benefit to customer
£1,675 – £53 per annum net bill saving plus £350 one-off cashback
From Year 26, when the loan has been paid off, the customer will see full £159 annual saving (in today’s prices) from the installation of these measures.
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