Green mortgages reward retrofitting

Renewables continue to solidify their position for the future as various industries collaborate to promote and reward their adoption in households.

Liverpool-based clean tech company Heatio is teaming up with Perenna Bank and Energy Systems Catapult to launch a green mortgage, offering lower interest rates to homeowners who adopt low-carbon technologies.

Liverpool-based clean tech company, Heatio, is partnering with Perenna Bank and Energy Systems Catapult to introduce a green mortgage with a long-term fixed rate. This innovative mortgage offers homeowners preferential interest rates as an incentive to retrofit their homes with low-carbon technologies.

The primary goal of this collaboration is to encourage a more widespread embrace of energy-efficient, low-carbon solutions while addressing the financial obstacles that hinder access to green energy.

Recognising that the initial costs of adopting technologies like heat pumps, solar PV, or battery storage can be a hurdle for some homeowners, this initiative allows them to incorporate these expenses into their mortgage and spread them over an extended period. Homeowners will enjoy reduced mortgage interest rates once these eco-friendly improvements are completed.

This project has support from the Department for Energy Security and Net Zero through its Net Zero Innovation Portfolio (NZIP), as part of the Green Home Finance Accelerator (GHFA) programme. GHFA was established to fund innovative green finance products that promote the adoption of home energy efficiency measures and low-carbon heating technologies.

Recent research conducted by the consortium during the 2023 GHFA Discovery Phase has identified cost as the most significant barrier to adopting low-carbon technologies, followed by a lack of available financial support. Many homeowners are uncertain where to begin making energy-efficient improvements and acknowledge the need for financial assistance to make these upgrades in their homes.

Roadmap for improvements

Heatio Flexx utilises a data-driven approach to create an accurate energy profile of the property, considering energy usage patterns and building characteristics. It then generates a customised improvement roadmap, guiding homeowners toward greater energy efficiency.

This approach ensures precise sizing and specification of low-carbon technologies, boosting consumer confidence in reducing energy costs, maximising efficiency, and reducing their carbon footprint. Additionally, digital validation of the installation of these new low-carbon technologies is provided through the Heatio Flexx platform.

Thomas Farquhar, co-founder of Heatio, emphasised the significance of incentivising energy-efficient home improvements. He said: “Our initiative with Perenna and Energy Systems Catapult is a bold step towards making energy-efficient upgrades not only financially accessible but also rewarding.  It’s important that we convey the idea that decarbonisation is not only achievable but beneficial. By making the transition to alternative heat and energy sources more seamless and appealing to homeowners, we can drive the enthusiasm of homeowners to participate.”

Arjan Verbeek, CEO of Perenna Bank, said: “We are delighted to be part of the Green Home Finance Accelerator and have the opportunity to work with Heatio and Energy Systems Catapult to pilot this innovative mortgage product that combines long term security with improvements in home energy efficiency.