Families may get millions in loans to help cut energy use

Published on Thursday 4 June 2009 22:03

THE Scottish Government is considering spending tens of millions of pounds a year on a loans scheme to spur people into action to improve the energy efficiency of their homes.

A report for the Scottish Government has revealed a large-scale subsidised loans scheme could encourage up to 26,000 households to take action each year.

Loans of about 10,000 for each home would be available, under the plans outlined by Mike Thornton, the head of the Energy Saving Trust Scotland. This could be spent on anything from cavity wall insulation to solar panels.

The Scotsman understands the government is considering bringing in a loans initiative within a few years.

Houses are responsible for about a quarter of all carbon dioxide emissions in Scotland, making them crucial in the struggle to meet climate change targets of reducing emissions by 80 per cent by 2050.

Experts say that, although energy efficiency measures save households money by cutting energy bills, not enough people are taking action.

In many cases, this could be due to a lack of up-front cash to pay for improvements.

A similar scheme in Germany has been taken up by 2.7 million homes since 1990, with 26 billion given out. This has brought about a 13 per cent reduction in . However, it has required significant government cash to cover the interest rate subsidy – 780 million annually in the past few years.

Chas Booth, spokesman for the Association for the Conservation of Energy, said: "In today's tough economic times, many Scots don't have the ready cash to insulate their homes properly or install solar panels.

"One solution to this problem is government-subsidised loans to householders to help them invest in energy-saving improvements.

"As this report makes clear, these loans can cut thousands of tonnes of greenhouse gas emissions and help homeowners to save the planet while also saving cash. The government must find the funds for this scheme without delay."

A spokesman for the Scottish Government said: "To help householders wanting to undertake more expensive energy efficiency measures, we are developing a loan scheme and will make an announcement later this year."