The Government’s green homes plan exaggerates savings on energy bills and could leave homeowners tens of thousands of pounds out of pocket, a study suggests.
Millions of people who want to build a conservatory, replace a broken boiler or install new windows face forking out for green-friendly loft or wall insulation, according to plans revealed by the Daily Mail on Monday.
Officials claim the cost of this work will be entirely offset by energy savings.
But research shows the energy savings can be far lower than expected and greatly raise costs.
Those who cannot afford the extra work will have to borrow the money – up to £10,000 – under the Coalition’s Green Deal and pay it back for years through an extra charge on their energy bills.
Today Deputy Prime Minister Nick Clegg will endorse the £14billion scheme in a major speech on ‘greening’ Britain’s homes. He will say it is essential to reduce energy bills and the nation’s carbon footprint.
However the energy savings are not calculated on the basis of a home’s actual energy usage but using an estimate called the Standard Assessment Procedure (SAP) – found by an independent review to be ‘very inaccurate’.
The 2x Law of Project Budgeting (thanks to my friend Thaddeus Stout):
“In any project Actual Costs will be 2x Projected Costs; Projected Benefits will be 2x Actual Benefits.”
Wow, a 200 year break-even period. Fun.