Octopus Energy has launched ‘Zero Bills’ mortgages which helps customers move into properties which have heat pumps and solar PV, with no energy bills for at least ten years.
The energy company has partnered with theUK’s first covered bond bank, Perenna, to offer these mortgages which breaks down the cost barriers of purchasing a green home.
The ‘Zero Bills’ initiative has been integrated into Perenna’s affordability calculations, resulting in a lower mortgage rate compared to their standard offerings.
Perenna will give potential homeowners much greater purchasing power, reducing the deposit needed and driving down the barriers to buying greener homes.
Octopus plans to deliver 50,000 ‘Zero Bills’ homes globally by the end of 2025.
The providers have already accredited over 1,000 homes in the UK through agreements with developers and housing providers.
Octopus plans to deliver 50,000 ‘Zero Bills’ homes globally by the end of 2025
OCTOPUS ENERGY
Customers will be able to purchase different types of homes under the initiative such as private, shared ownership, affordable, and social rent.
Michael Cottrell, Zero Bills Homes Director at Octopus Energy, commented: “Our ‘Zero Bills’ homes guarantee no energy bills for 10 years. We’re delighted that Perenna is the first bank to acknowledge the value of green tech by offering a lower interest rate to ‘Zero Bills’ customers compared with their standard mortgages.
“And we’ll keep innovating and partnering with like-minded companies to further speed up the move towards affordable, cleaner living.”
Arjan Verbeek, co-founder and chief executive officer at Perenna, said: “Decarbonising UK homes is a massive challenge and requires collaboration. We’re glad to partner with Octopus Energy who want to solve structural issues and take ambitious steps to deliver them.
“The ‘Zero Bills’ initiative is a testament to how forward-thinking Octopus Energy is.
“We can’t wait to unlock ‘Zero Bills’ homes for more people through our innovative mortgage offer.”
Houses built could be fitted with green energy technology such as an air-source heat pump, a home battery, and solar panels on the roof.
Perenna’s ‘Zero Bills Mortgage’ will allow even more homes in the UK to be bought and sold by green-minded homeowners.
Research from Make UK Modular shows two-thirds of adults below the age of 30 consider sustainability to be an important factor when looking for a home.
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Rachael Hunnisett, associate director for Built Environment at the Green Finance Institute, said: “The Green Finance Institute is proud to have enabled the Octopus and Perenna collaboration, two organisations familiar with challenging the norm in the pursuit of market-leading innovation.
“Recognising the impact of energy costs on homeowners and reflecting this in borrowing amounts is a pioneering step forward for the mortgage industry. Collaboration and innovation – ensuring that changing customer needs are at the heart of product design – is the key to transitioning the UK housing stock towards net zero.”