Energy Price Rise Q & A: £1,000 ECO Grant

The continuing saga of power price increases is forging full steam ahead. Even with some utility companies placing freezes on their tariffs to keep monthly payments temporarily manageable for consumers, the overall cost of energy is still going up. This means that, at some point, it’ll be time to pay the piper.

That’s why, even if you feel safe with a frozen rate gas or electricity tariff, it behooves you to look into securing as many options as you can right now to protect yourself against future increases in energy prices, because once your frozen tariff expires, the new prices will likely be more shocking than ever.

A great hedge against increasing power prices it to make your home as energy efficient as possible, as thoroughly as possible. But the very process of improving a home’s energy efficiency requires money. Costs to tighten up a property’s energy rating can range from inexpensive weather stripping to very expensive heat pumps or solar photovoltaic panels installed upon a roof. It can be very frustrating to look at the circular logic of spending money to save money; the very concept has sent many a consumer into despair, wondering just how any of it is to be accomplished.

This energy price rise Q & A looks specifically at a recently unveiled grant for home buyers.

Energy Price Rise Q & A: £1,000 ECO Grant

Q: What is the £1,000 ECO grant about?

A: One of the biggest recent developments splattered all over the news recently was Chancellor George Osborne’s announcement of a £1,000 grant being made available to homebuyers. Unlike a loan, grant money is free money that you never have to pay back.

This grant is specifically designed to help buyers upgrade homes they purchase to bring those properties up to a higher level of energy efficiency. The funds could be used to replace a dated boiler system, install more efficient windows, add insulation to ceilings, walls or floors or go toward other measures that would make the property more of an energy miser.

Depending on the condition of the property purchased, an even larger sum might be awarded. The grant isn’t limited to resale housing, but can also be applied to new-build projects, as well. This measure is part of a larger Energy Company Obligation (ECO) scheme that will give consumers a break of £50 annually on average in their energy bills, and will also give the Big Six more time to come under compliance with set targets. [1]

On the plus side, this plan is said to be funded by fines levied on tax avoiders, and not funded by monies already earmarked for other household energy initiatives. The money is absolutely free to recipients with no need to make repayments.

On the minus side, it is important to carefully note that this £1,000 of free money is earmarked for home buyers, not homeowners. You can’t obtain this money for your existing home; you must purchase a new (or new-to-you) home in order to participate in the scheme.

Details on how to apply for this new grant have not yet been announced.

How “Free” is Free Money?

There’s one other little downside to most grants–the indisputable law of TANSTAAFL: “there ain’t no such thing as a free lunch.” Grant money offered up by private institutions is typically amassed through fundraising efforts conducted by interested parties. In such cases, other people are contributing to such funds, but they do so voluntarily. Government funded grants, however, are sourced from monies that somehow, in some way, can be traced back to taxpayers. In the case of the £1,000 grant discussed earlier, the scheme is said to be funded by those who, for whatever reasons, have been remiss in paying their taxes, and who will be fined extra for the oversight. Those individuals will therefore be paying for other people’s boilers and so forth, and surely not voluntarily so.

It would be interesting to investigate how many people were unable to make their tax payments due, at least in part, to budget burdens placed directly upon them by rising energy costs. It would indeed be ironic if a person were so oppressed by power costs that he failed to make his tax payments in a timely manner, were then fined for the failure to pay the tax, and then that fine went to go help pay for another family’s energy scheme improvements to make their power costs more affordable.

Sam Jones recommends that energy tariff changes and all regional energy prices are available for review on premier UK comparsion website uSwitch

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