The parliamentary select committee on energy and climate change accused ministers of failing to set clear goals for what they hoped to achieve from the green deal. That failure would make it harder to achieve substantial outcomes from the policy, the group of MPs said.

Tim Yeo, former Conservative minister and current chair of the committee, said: "It is unacceptable that, three years into the life of this parliament, ministers are unable to explain what success would look like from one of the coalition's flagship policies."

The committee also listed several obstacles to the green deal, including the difficulty for people renting their homes of obtaining consent from their landlords to take up the offers, and that many people might find the hassle of the building works involved in complex renovations – such as solid wall insulation – too offputting for the low level of benefit they are likely to obtain.

The green deal has been beset by problems since it was announced in the early days of the coalition, with its launch delayed by several months until the end of January this year. Critics have called the scheme over-complex – it relies on homeowners taking out loans to cover energy efficiency improvements to their properties, which are paid back over years in the form of additions to energy bills. The loans apply to the property, so any owner selling needs to pass on the liability to the buyer or pay back the loan early, risking penalties. There have also been concerns that the interest rates charged on the loans would deter many households, and that households may be discouraged by the poor reputation of energy companies after a series of mis-selling scandals and price-fixing in the wider industry.

The government rebuffed the committee's claims of obstacles, saying that any household taking up a green deal offer will be guaranteed to save money on energy bills over the lifetime of the loan. However, although the scheme was formally launched in late January, there have been no publicly released figures yet showing how many households have chosen to install energy efficiency measures as a result of the deal. Those figures are due next month.

In the meantime, the Department of Energy and Climate Change (Decc) said last week that nearly 19,000 green deal assessments had been carried out by the end of April. These are undertaken by green deal suppliers in order to inform interested households of how much they could benefit from measures such as cavity wall insulation or windows and door replacements, but they carry no obligation for the homeowner to follow through with the installation.

In its report on progress under the green deal, the committee said that the government must be able to judge whether take-up levels were low or high enough, and if they were found to be too low, to engineer changes to the policy that would improve its uptake.

Greg Barker, minister for energy and climate change, said the results were encouraging: "It's still early days for this long-term initiative, but this is a clear sign of growing interest from consumers, with people keen to improve the efficiency of their homes to make them warmer and help save money on bills."

Decc has previously estimated that 14m households could benefit from the sorts of improvements that would be financed under the green deal, but it has not said how many people it hoped to reach in each year of the policy's operation. The department said the number of suppliers and experts was also increasing: at the end of April there were 55 authorised green deal providers, as well as 1,274 individuals registered to carry out assessments and 942 organisations signed up to carry out installations.

But industry experts called on the government to heed the warnings of the select committee and put more force behind the green deal, as well as quantifying what would be regarded as success from the initiative. Paul King, chief executive of the UK Green Building Council, said: "With rocketing energy bills becoming a real worry for householders, it's encouraging that the government has moved home energy efficiency higher up the agenda. However, while there are positive signs that the green deal is helping to catalyse greater interest in home retrofit, there is a lack of clarity about what success looks like. Government needs to work with the private sector, to produce a clear route map for retrofitting the UK's 26m gas-guzzling homes, detailing what needs to be achieved by when – giving industry the confidence to invest in a new market of energy services and retrofit solutions."

Richard Lloyd, executive director of the consumer advocacy organisation Which?, said: "The government must be clear about what the green deal is expected to achieve, and we welcome the select committee's scrutiny to help hold ministers and officials to account on behalf of consumers. Rising energy prices are consistently one of consumers' top financial concerns so it is right to help people save money by making their homes more energy efficient. The government must act now to make sure that the green deal delivers real savings on energy bills. Any bad practice in selling green deal products must be stamped out as quickly as possible."

Separately, the government announced it would include measures to encourage energy efficiency in the forthcoming energy bill. The decision was welcomed by energy campaigners. Decc said that under its new proposals, companies installing measures that result in permanent reductions in the amount of electricity they use could receive financial incentives. The department said it was deciding whether to "test the proposed approach via a pilot" as a way of gathering evidence on what from the proposed incentive should take.

Andrew Warren, chief executive of the Association for the Conservation of Energy, said: "This is a tremendous triumph for common sense. It is a policy which [we have] campaigned about for over two decades. Throughout that time, every objective study has revealed that it is frequently far cheaper in strategic terms to save electricity than it is to generate electricity. It is very welcome news that at long last the government is legislating so negawatts [amounts of electricity that go unused owing to efficiency measures] will be able to compete on an even playing field with conventional megawatts. We hope that the relevant amendment to the electricity market reform bill will be tabled by the government in time so it can be discussed at the commons report stage [due in about a fortnight]."