The Government has moved to accelerate Ireland’s transition to renewable energy with the official launch of the new low-interest Home Energy Upgrade Loan Scheme.
The new €500 million loan scheme, which is Government-backed, allows residential homeowners to borrow at much lower interest rates so they can upgrade the energy efficiency of their properties. Applicants can borrow between €5,000 and €75,000 to make their homes warmer and more energy-efficient, with no security required and repayment terms of up to 10 years.
Launching the new scheme, Minister for the Environment, Climate and Communications, Eamon Ryan TD, said: “We have designed the loans with the needs of homeowners in mind. Access will be simple and speedy with an emphasis on reducing the workload for homeowners accessing both loans and grants. We also anticipate that with greater competition on the market, loan rates will also become more competitive, giving people more choice and value.”
PTSB is the first to market with the new loan scheme, offering rates from 3.55%, although AIB, Bank of Ireland, Avant Money and a number of credit unions are expected to follow, all with interest rates significantly lower than what is currently available.
How to qualify for this scheme?
To qualify for a low-interest loan under the new scheme, which is the first of its kind in Ireland, the planned upgrade works must be eligible for a home energy grant from SEAI. Households that use the new scheme to improve their BER rating may also qualify for a lower cost green mortgage in the future.
Although loans can be used to undertake individual measures (e.g. installing a heat pump or wall insulation), a significant amount of upgrades are expected to be carried out via SEAI’s One Stop Shop scheme. One Stop Shop is a fully-managed, complete home energy upgrade solution for homeowners who wish to carry out a ‘deep’ retrofit involving multiple upgrades.
“With this scheme, the loan application process actually starts with the One Stop Shop or installer rather than with the lender,” says Fergal Cantwell, Retrofit Project Manager with Envirobead, a Daikin installer partner and one of Ireland’s 20 registered One Stop Shops.
“We carry out a Home Energy Assessment, then provide a quote for the cost of the works being planned,” Fergal says. “The homeowner gives that quote to the lender and the lender makes a decision yes or no. The whole process is designed to make it easy for the homeowner to apply and easy for the lender to make a decision.”
The long-awaited launch of the new low cost loan scheme is expected to accelerate the pace at which Irish households are moving away from fossil fuel heating systems. With Ireland’s 2030 climate targets looming large, the Government is clearly hoping the ready availability of credit will persuade homeowners to future-proof their homes.
“When it comes to retrofitting heat pumps and other energy efficiency measures, cost is always the biggest barrier,” says Fergal Cantwell. “These loans will make home energy upgrades much more affordable for a lot of people, which is good news for them and also good news for the Government’s climate targets.”
How it works: One Stop Shop
Typically, a full retrofit carried out via the One Stop Shop would involve a package of home energy upgrades including, for example, a heat pump, wall insulation, attic insulation, replacement doors and windows, and solar PV panels. (The latter can only be funded with a loan via the One Stop Shop system.)
For any homeowner contemplating an energy upgrade, heat pumps offer unrivalled energy efficiency and A-rated performance to deliver heating and hot water all year round. SEAI has estimated that as many as 250,000 Irish homes are “heat pump-ready”, i.e. they need minimal changes for the heat pump to work efficiently.
The Home Energy Assessment – step one for homeowners interested in applying for a HEULS loan – will determine whether the property is suitable for a heat pump, as well as what other measures are required to achieve the desired energy rating.
“The Home Energy Assessment is your roadmap for the entire journey,” says Envirobead’s Fergal Cantwell. “As a One Stop Shop, we look after all the administration as well as managing the retrofit project, so there’s no need for the customer to be ringing sub-contractors or chasing people up. Everything is managed under one roof from start to finish.
“At the end of the process, the homeowner has to prove that the money was spent on a home energy upgrade,” says Fergal. “Within that, although 75% of the loan must be spent on energy efficiency measures, up to 25% of the amount can be spent on something else within the home, such as a new kitchen or bathroom.”
As the first scheme of its kind, it’s hoped that the new Home Energy Upgrade Loan Scheme will play a vital role in helping Irish homeowners to make their homes warmer, more economical to run and of course more sustainable. To find out how you can benefit from the scheme, contact your local installer or One Stop Shop today.
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