The Green Homes Grant was announced with much fanfare in 2020. As part of the government’s drive to achieve its climate targets, the scheme was supposed to help householders in England insulate their homes. However, it has now been scrapped and the cash reallocated.
So what happened? And what does this mean for Green Homes Grant applicants?
What was the Green Homes Grant?
The Green Homes Grant was a voucher scheme that saw homeowners in England receive up to £5,000 to pay for part of the cost of energy-saving measures such as insulation and low-carbon heating improvements.
It basically saw the government pay two-thirds of the cost of energy-efficient changes to an applicant’s home. Work included things like underfloor insulation measures and installing biomass boilers. With 19 million homes in the UK needing energy-saving improvements, it was supposed to be a big step in the right direction.
Originally supposed to be in place until 31 March 2022, the scheme has now been scrapped and no new applicants are being accepted.
Why was it scrapped?
So what happened? Well, the Green Homes Grant reached just 10% of the 600,000 homes it was designed to reach.
This was for a myriad of reasons – and unsurprisingly Covid-19 was a factor. Ministers blamed people’s reluctance to let tradespeople into their homes because of the fear of catching Covid-19.
However, there were also reports of a shortage of accredited installers. That has been cited along with a slow voucher rollout, which meant businesses weren’t paid, and overall poor administration.
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What do you do if you have already applied?
The Green Homes Grant scheme is now closed to new applicants. But if you are one of the 10% of homeowners that actually managed to take advantage of the scheme, you will still be able to redeem your voucher.
The same rules apply. You need to redeem your voucher by its expiry date, which is three months from the date it was issued. The work must be completed by a TrustMark-registered installer and you must be the homeowner or landlord of the property.
Once you have redeemed your voucher, you’ll receive a confirmation email and your bit is done. The grant will then be paid directly to the installer.
Is there an alternative?
Unfortunately, the government has not come up with a clear alternative to the Green Homes Grant. Instead, it has just said that the £300m previously allocated will go into a programme administered by local authorities. This will be targeted at lower-income households. Any further details are pretty scarce at the time of writing.
So if you want to make your home more energy-efficient, you may have to go down more traditional financing routes.
Interest rates are relatively low at the moment, so you could secure a personal loan with fixed monthly payments that suit your budget. Alternatively, if you are confident that you can pay off your balance during a set interest-free period, then a 0% purchases credit card could help you avoid costly interest charges.
Another option would be to remortgage. Sometimes you can increase the value of your home by making improvements. So remortgaging to release some equity in order to do the work could make financial sense.
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