The Green Deal for

Housing Associations

Plenary six: Legal framework –

Green Deal requirements

Speaker:

Bill Hull, Partner, TLT Solicitors

Chair:

David Orr, Chief Executive, National Housing Federation

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Bill Hull, TLT LLP

Legal Requirements of the Green Deal

6 November 2012

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Introduction

• Big decision – how to participate in Green Deal?

• Look at options/issues for participation:-

• As Green Deal Provider?

• Other regulated roles – Green Deal Assessor or

Installer?

• Partnering?

• Solely as landlord?

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Legislative Regime

• A new scheme, so lots of new rules

• Energy Act 2011

• Multiple pieces of secondary legislation, especially the

Green Deal Framework (Disclosure, Acknowledgement,

Redress etc) Regulations 2012

• Code of Practice – see DECC website

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Green Deal Provider (1)

• Consider pros and cons of participation:-

• see HCA paper of July 2012

• control over works vs. bad debt and guarantee risk

• multiple relationships to manage

• Access to ECO brokerage – may need to be Provider

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Green Deal Provider (2)

• Must be authorised – apply to Green Deal Oversight and

Registration Body (ORB)

• Have Consumer Credit Act (CCA) licence

• Enter into Green Deal Arrangements Agreement (see

DECC website):

• With electricity suppliers

• Standard (but complex) terms

• Comply with Code of Practice

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Green Deal Provider (3)

• Green Deal contract terms must comply with:

• Code of Practice

• Consumer Credit Act requirements (where

applicable), including cancellation rights

• Unfair Terms in Consumer Contracts Regulations

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Green Deal Provider (4)

• Installation of measures must be backed by guarantees:

• Minimum 5 years for functioning of measures (or 25

years for wall insulation)

• Minimum 10 years (or 25 years for wall insulation) for

consequential damage

• Must be insurance backed

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Green Deal Provider (5)

• Responsible for handling complaints:

• Specific requirements in Code of Practice

• Includes warranty/damage claims

• Note debt collection position:

• Green Deal Provider not collecting directly

• Reliant on energy supplier – see Green Deal

Arrangements Agreement

• Bad debt risk must be considered

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Green Deal Provider (6)

• Enter into Green Deal Plan with tenants/homeowners

• Finance offer

• Contract – installation and repayment

• Green Deal finance package must meet "Golden Rule":

• Based on Assessor's report

• Total repayments not exceeding estimated bill

savings

• Other measures could be installed – BUT outside

Green Deal

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Green Deal Assessor (1)

• Must be certified (accredited):

• Apply to certification body (e.g. Energy Saving Trust)

for certification

• Demonstrate compliance with "Assessor Services

Specification" – see DECC website

• EPC experience a good starting point

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Green Deal Assessor (2)

• Carry out assessments, make recommendations in

advice report, as to measures:

• Assessor could be tied to a Green Deal Provider

• BUT advice must be given impartially, in accordance

with the Code of Practice

• Minimum insurance requirements apply

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Green Deal Installer (1)

• Must be certified (accredited):

• Apply to certification body (e.g. Energy Saving Trust)

for certification

• Demonstrate compliance with PAS 2030:2012 –

specification for assessment services

• Gas Safe or MCS = compliant for particular

measures

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Green Deal Installer (2)

• Carry out installation work, under contract with Green

Deal Provider:

• Comply with Code of Practice

• In practice, offer guarantees/warranties to back-off

Green Deal Provider guarantees and liability for

sanctions

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Redress/Sanctions (1)

• If Green Deal participant breaches requirements:

• Tenant/homeowner may seek redress through Green

Deal Ombudsman service

• Secretary of State has power to impose sanctions

• Other legal action may occur e.g. damages claim for

negligent advice or breach of contract, claim that

"unfair" contract terms not enforceable

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Redress/Sanctions (2)

• In addition to risk of suspension/withdrawal of

authorisation, financial sanctions:

• Can arise through cancellation/reduction of Green

Deal Plan and/or financial penalties up to 50k per

breach

• Will fall on Green Deal Provider in relation to Installer

breaches

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Partnering

• Seek to partner with external organisation

• Emerging models for large scale partnering e.g.

Birmingham, Warm-Up North

• Particular issues:-

• Limited to endorsement, or active JV involvement?

• Access to funding?

• Public procurement?

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Landlord Issues

• Informal partnering/endorsement of provider?

• Tenant initiated works:–

• Landlord consent may or may not be required

• Type of lease/lease terms

• Landlord initiated works: -

• Tenant consent as bill payer

• Challenge – blocks of flats

• Exposure to Green Deal charges for vacant properties

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Key Points

• Multiple options for participation

• Lots of issues to consider - guidance document such as

HCA paper will be useful

• Legal points arise with all forms of participation, but

especially as authorised Green Deal Provider

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For further information

Bill Hull

Partner, TLT LLP

Tel: 0117 917 7808

Mobile: 07786 515801

Email: bill.hull@tltsolicitors.com

Website link:

http://www.tltsolicitors.com/expertise/g/green_deal

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Thank you