The UK government yesterday launched a £5m fund for the financial sector to begin developing green mortgages as well as a £10m fund to reduce the costs of retrofitting the UK’s housing stock. The initiative aims to reduce the energy consumption of homeowners by rewarding them with cheaper mortgage rates.
Once consumers improve the energy rating of their home, they will be eligible to receive a reduced mortgage rate.
Currently, it is estimated that 17 million homes have Energy Performance Certificate rating of C and below within the UK. Those homeowners whose homes fall under this category, are likely to benefit from this new initiative.
This move comes after the UK government passed a law that commits the country to achieving a net zero carbon economy by 2050.
This scheme will see innovative projects awarded funding in order to promote energy efficiency; helping homeowners reduce their carbon footprint.
Energy and Clean Growth Minister Chris Skidmore said:
“To fulfil our world-leading commitment to reach net zero emissions by 2050, we need an overhaul of our housing stock to tackle the disproportionate amount of carbon emissions from buildings.”
“By rolling out more green mortgages and reducing the costs of retrofitting older homes we’re encouraging homeowners to improve the efficiency of their homes and save money on their energy bills, helping to ensure everyone has access to a warm and comfortable home.”
Currently homes are responsible for 15% of the UK’s carbon emissions and whilst this move is welcomed, more needs to be done for the UK to reach its target of net zero emissions by 2050.
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