The Energy Companies Obligation Scheme can be extremely difficult to understand. The slight variations in eligibility criteria and ever-changing energy landscape makes it hard for even the experts to keep up. So, when it was recently announced that the introduction of ECO4 is bringing about more adjustments, you can be forgiven if you feel slightly confused – but don’t worry, we’re here to help!
The ECO Scheme was originally introduced to Great Britain in 2013 and aimed to reduce carbon emissions & the number of fuel poor households throughout the UK and has since seen the installation of 3.1 million measures into 2.3 million homes. The scheme offers support to those on benefits and in low-income, fuel poor or vulnerable households. The current types of measures offered are loft insulation, cavity wall and boiler replacements/upgrades, with the existing scheme having seen the installation of 134,000 boilers.
Fuel poverty is unfortunately a fact of life for many households throughout the UK and an increasing problem with numbers only set to rise due to the current ‘cost of living’ crisis. The IPPR suggested in 2015, the average fuel poverty gap (the amount a fuel-poor home exceeds reasonable energy bill prices each year) was £353 meaning residents were forced to make choices between heating or eating, a trend we are starting to see emerging again in recent times.
The current ECO4 scheme obligates the largest and most successful energy companies to promote measures which increase the capacity of vulnerable, low-income and fuel poor household to heat their homes. Fuel poverty is relatively preventable through actions on energy prices and direct financial support to the relevant households via energy efficient schemes such as the Energy Companies Obligation. The Government initially proposed to upgrade as many fuel-poor homes as reasonably practical to a band C EPC certificate by 2030 via the ECO scheme. Now, as of July 1st, 2022, ECO3 came to an end and has since seen the introduction of the fourth and final phase, ECO4.
ECO4 has brought around many new changes, including eligibility criteria and the types of services provided. The Government have said that they hope to have all homes in the UK up to a band D EPC by 2025.
So, what are the main differences between ECO3 & ECO4?
Although there are a lot of similarities between phase 3 & 4 of the ECO scheme, the government is now aiming to reach more people during this final stage.
To do this, one of the most notable changes will be the eligibility criteria, which will see multiple benefit schemes being removed (mostly disability benefits) including [but not limited to] war pension, disability living allowance and carers allowance. Although some benefit schemes are being removed, ECO4 saw the introduction of Housing Benefits and the Government have changed the rules surrounding the LA FLEX criteria meaning more people can qualify.
Another major change comes from the removal of LPG and Oil instalments. Focus is now being put on repairing current heating systems in households across Britain, including mains gas central heating and modern electric storage heaters. It also saw the reduction in the number of boilers being installed via this scheme, a once highly popular and valuable measure. In its place, ECO4 will work hard to promote Innovative Measures (IM) such as heat pumps and solar panels as they are now being offered extensively throughout the UK.
Under ECO3, grants were awarded based on the lifetime savings of the insulation or heating measure installed. However, ECO4 has seen adjustments to how the grants are rewarded, as grants are now given based on how big the difference is between the energy performance ratings (EPC).
ECO4 will also see modifications on requirements for firs time central heating measures. It will now be expected that the household has some form of solid wall insulation [either internal or external] and if you are offered a first-time central heating system, you will be required to take all the insulation methods recommended.
Although ECO4 has brought about many new amendments to the scheme, it has opened doors for more people to qualify based on their living conditions and will hopefully see the further reduction of fuel poor households, carbon emissions and energy bill prices.
This scheme allows companies such as ours to install insulation and heating measures for free to those who need it most all for FREE. With the current state of the energy climate throughout the UK and worldwide, we see no better time than now to do our bit and spread the word about ECO4 to help those who are vulnerable to heat their homes and protect their families.
If you are unsure of whether you qualify for this grant and are confused regarding the introduction of ECO4, please get in touch and we would be happy to talk you through. Please visit our website to complete our 2-minute eligibility checker or simply call on 0333 444 1062.