The ECO Obligation Explained
The Energy Company Obligation (ECO) is an energy efficiency scheme for Great Britain.
ECO places legal obligations on larger energy suppliers to deliver energy efficiency measures to domestic premises.
It focuses on insulation and heating measures and supports vulnerable consumer groups.
ECO is intended to assist in reducing carbon emissions, maintaining security of energy supply and reducing fuel poverty.
The ECO2 obligation period was due to end on 31 March 2017, however, the scheme was extended by 18 months. This extension period is known as ‘ECO2t’ which ends on 30th September 2018.
ECO3 is intended to start on or after 1 October 2018 and is expected to run until 31 March 2022.
The government’s response to the Energy Company Obligation (ECO3) consultation sets out the policy of the scheme.
The scheme will continue to deliver energy efficiency and heating measures to homes in Great Britain and will include:
- focusing the entire scheme to support low income, vulnerable and fuel poor households
- reducing the current supplier obligation threshold of 250,000 customer accounts (or equivalent) for the scheme, in a phased way, to 150,000 customer accounts (or equivalent) from 2020
- requiring 15% of measures to be delivered to rural homes
- increasing the proportion of the scheme that can be delivered under local authority flexible eligibility to 25%
- allowing up to 10% of a suppliers’ obligation to be met through the delivery of new, innovative products
- supporting households that have a broken heating system by allowing the equivalent of 35,000 broken heating systems to be replaced per year
- encouraging a multiple measure approach by allowing the replacement of inefficient heating systems to be replaced (outside of the broken heating system cap) if they are installed alongside insulation
- requiring the equivalent of at least 17,000 solid walled homes to be treated per year, either through solid wall insulation, or using a combination of other technologies (if equivalent savings can be achieved in the property)
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