Millions of pounds of cash back is being made available for those who make energy saving home improvements under the Green Deal, government announced today.

From 28 January 2013, householders who use the Green Deal to make improvements such as loft insulation, solid wall insulation and replacement boilers will qualify for as much as £1,000 cash back.

Energy Secretary Edward Davey said the scheme will benefit authorised installers and assessors who can use it to attract customers where they are working with a Green Deal Provider.

“This cash back offer will help get the Green Deal off to a flying start. It really is a great offer – the more work households have done, the more energy they stand to save and the more cash they receive,” he said.

“The Green Deal also presents a great opportunity for businesses of all sizes to take advantage of this transforming market – and now is a critical time. Whatever your business does in this sector, the Green Deal will have an impact. So I say to businesses large and small – gear up, get training and get ready to take advantage of the Green Deal.”

However the heating industry fears that while the scheme is a step in the right direction, it’s the wrong timing.

The HHIC said that with boiler sales struggling in this difficult economic climate, the scheme will be too late when it is launched in January 2013 to make an impact for UK manufacturers.

Roger Webb HHIC director said: “While we welcome the announcement and the government’s recognition that the market needs a stimulus, we cannot wait for a scheme that will not be available for six months and has many complexities. The struggling heating industry needs support now and the government could provide instant incentives that would help consumers replace inefficient boilers just in time for those cold winter months. This would provide greater energy efficiency and make a real difference to their energy bills when consumers are being squeezed from all sides.”

Garry Worthington, head of Green Deal at Climate Energy also welcomed the idea but expressed concerns that it doesn’t go far enough to encourage long-term participation in the scheme.

“We have real concerns that when this £125m is spent and the cash-back incentive is withdrawn that there will be a slump in take-up of Green Deal, and companies involved in carbon reduction like Climate Energy will be left to foot the bill of marketing the scheme to ensure its success,” he said.

“Instead of this short-term solution we would like to see more money spent on a nationwide marketing campaign by DECC that will demonstrate the long-term financial and wellbeing benefits of participating in Green Deal, securing both the future of the scheme and of energy efficiency and carbon reduction in the UK.”

The Green Deal Cashback Scheme is a first-come, first-served offer, and the more work households have done, the more cash back they could receive. The offer is limited to one per household, but can cover a package of improvements so long as the householder is contributing to installation costs and an authorised Green Deal Provider oversees work done.

The rates published today are guaranteed for the first £40 million of the scheme. A total of £125 million is available, and the offer also applies to private or social landlords who can benefit if they are the property improver and are paying the costs themselves.

For more information visit the DECC website.