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ENERGY ACT 2011 - “Green" is the new colour when it comes to your property.

Under the Energy Act 2011, occupiers or owners of an eligible property (which can be either domestic or commercial) who enter into a Green Deal plan can have energy efficiency measures carried out to their property and paid for, whether in whole or in part, in instalments, which instalments are added as a charge to the energy bill of the property and recovered by the energy provider.

The energy efficiency measures which can be carried out under the Green Deal include insulation, heating, glazing and other measures (to name only a few), the aspiration (if not guarantee) being that it will result in reduced energy consumption and/or carbon emissions and ultimately result in fuel bill savings.

Conditions include:-

  •  a Green Deal assessor assessing whether your property is an eligible property and recommending appropriate energy efficiency improvements.
  • a Green Deal provider giving an estimate of the savings likely to be made on the energy bills if the improvements are carried out and an estimate of the period over which the savings are likely to be made and making an offer to carry out the recommended improvements on the basis that the cost will be repaid by the occupier or owner.

The Green Deal plan is a financial product and will be regulated by the Consumer Credit legislation.

The costs under a Green Deal plan are a heritable debt (not a personal debt) and on re-sale or lease of the property the seller, landlord or licensor is under a legal requirement to disclose the details of the Green Deal plan and to secure from the purchaser or tenant an acknowledgement in the prescribed form that they will be liable to make payments under the Green Deal plan.

Consequences for failing to comply with the legal requirements include:-

  • sanctions for non-compliance (including a civil penalty), and
  • in the event of that a green deal provider is required to suspend or cancel a bill payers liability to make payment under the Green Deal plan or is required to refund any payments that have already been made, the seller, landlord or licensor being liable to compensate a green deal provider.

Purchasers and conveyancers alike will require to be careful when buying property to ascertain whether the property is subject to a Green Deal plan. The Purchaser must then decide whether he is prepared to undertake what could be a long term commitment to repay a possibly substantial debt. The existence of a Green Deal plan, the liabilities which exist and whether the Purchaser will assume the liability are therefore likely to become yet another matter to be negotiated as part of the missives. .


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