Energy Companies adding 'up-front' cost to the Green Deal

olilea1981

The Green Deal may be gone, but there's headaches for it to cause yet. The company I work for was - among other things - a Green Deal installer for the past six months.

Just so it's clear, the idea of the Green Deal is that there is no 'up-front cost' for energy efficiency measures. The measure (be it insulation or a new boiler) causes a predicted reduction in your energy usage, and you repay the Green Deal Loan through your bill in chunks that are smaller than your predicted saving.

Unfortunately, it seems the energy companies - so far confirmed British Gas and SSE - don't want to keep to the spirit of the scheme, and are adding the Green Deal repayment to customers bills without taking into account their reduced usage. To illustrate:

The way Green Deal should have worked
Customer's old bill: £60
Predicted bill change thanks to new insulation/boiler: -£20
Green Deal loan repayment: +£15
Customer's new bill: £55

What's actually happening
Customer's old direct debit: £60
Predicted bill change thanks to new insulation/boiler: TOTALLY IGNORED
Green Deal loan repayment: +£15
Customer's new bill: £75

Obviously this will right itself long term as the customer submits readings and it becomes apparent that their usage is much less than the estimated, and they will end up hugely in credit. But what it means is that it turns out that the customers are having to shell out extra money up-front, not because of any error in the Green Deal process, but because the energy companies are choosing to add the GD premium to the customer's bill without accounting for their predicted savings. In other words, totally going against what the Green Deal is (or, I should say, was) supposed to achieve.

Green Deal customers are few and far between so I'll be surprised if there are any on here, but has anyone else experienced this? And if there are any energy company representatives here, do you care to explain why this had been done? Because I'm going to be taking calls for some time from angry customers whose bills have increased when the promise of the Green Deal was that they wouldn't.

spiro

The reason suppliers may not immediately reduce the DD is because until future consumption is known they will not know if the customer decides to reduce their consumption or not reduce their consumption and live in a more comfortable environment.

Smiley_Dan

You do realise they have quarterly revenue forecasts to meet, right?