company position: green deal
Last updated: 27/01/2012
SmartestEnergy broadly supports the aims of the Green Deal scheme to provide domestic customers with access to finance to pay for energy efficiency measures.
However we have concerns with some of the specific proposals and disagree with the planned inclusion of business consumers.
Participation of businesses
We believe that businesses looking to invest in energy efficiency measures will choose to access cheaper forms of finance than will be available via the Green Deal.
Although businesses are unlikely to use the Green Deal, their inclusion means non-domestic electricity suppliers will incur cost by having to change their billing systems in order to comply with the scheme.
Independence of assessors
We believe that Green Deal assessors should be independent and not salaried employees or sub-contractors of Green Deal Providers, Suppliers or Installers.
It is essential that no cross-selling or even marketing of other products is allowed as this would place smaller suppliers at a disadvantage in the energy supply market.
Default risk
In the event of non-payment by a customer, it is proposed that energy suppliers and Green Deal providers will share the shortfall. We feel it is unfair that suppliers are expected to carry part of the default risk given they will not benefit from the participation of consumers : if a customer withholds their Green Deal instalment but pays their energy bill, that payment would have to be split between the supplier and Green Deal provider.
Administration fee
Although we feel that there should be a standard administration fee charged to prevent suppliers having to spread costs across their whole customer base or setting their own level, we don’t believe the proposed £3 fee per Green Deal regardless of size of supplier or number of customers is appropriate.
Such an arrangement would put smaller suppliers at a considerable disadvantage as the IT costs involved in changing billing systems to accommodate Green Deal will not be proportionate to the size of business.
We also believe that the administration fee should be payable monthly or at least as often as the customer is currently billed.
Opting-in
We believe allowing smaller suppliers to opt-in to the scheme on a flexible basis if and when they have a customer using the Green Deal would be a sensible approach.
However, the most effective solution would be to allow for a separation between Green Deal repayments and normal utility bills. This would help ensure the involvement of financial backers, protect small suppliers, allow ease of switching and promote competition.
Payments
Once the customers are billed, money will be required to be paid by suppliers to finance providers within 48-72 hours. We would prefer that these payments are made in monthly blocks.
For additional information, please contact us.
print this page