The Energy Company Obligation explained
The Energy Company Obligation, or ECO, is an energy efficiency scheme set up by the Government to help reduce carbon emissions in the UK and tackle fuel poverty. It was started in April 2013 and has been amended over time. It is administered by Ofgem on behalf of the Department for Energy, Business & Industrial Strategy
The main obligation of the latest updated policy is the HHCRO, or Home Heating Cost Reduction Obligation. This means that obligated suppliers have a duty to mainly promote measures aimed at improving how people can heat their homes if they are fuel poor, on a low income or classed as a vulnerable household.
This focuses on actions to promote heating savings, including:
Replacing broken central heating systems
Upgrading inefficient heating systems
Help in your home
Under the ECO scheme, large and medium-sized energy suppliers are required to pay for the installation of measures to improved energy efficiency in British households. These suppliers have a target based on their domestic energy market share in the UK.
Obligated suppliers operate with installers to introduce efficiency measures into British homes. These include heating measures and wall or loft insulation.
Understanding the HHCRO
This policy, known as the Home Heating Cost Reduction Obligation or The Affordable Warmth Obligation, is aimed at ensuring that energy suppliers promote the installation and use of measures that enable people to make financial savings when it comes to their energy bills.
Are you eligible for an ECO central heating grant?
You may be eligible for ECO if you receive Child Tax Credit and satisfy relevant income criteria. It is also worth noting that under the latest ECO3 policies, there is an additional benefit for district heating measures and solid wall insulation. This is known as an in-fill mechanism and comes into place if 66 per cent of eligible households get either of the measures mentioned previously. If this happens, an adjacent property could also benefit from the same measures even if the occupants do not meet the qualifying criteria.
If you are looking to benefit from ECO and claim Child Tax Credit, there are some other criteria you must fulfil. You must either own your property or have your landlord’s permission. The latter includes if your home is owned by a social housing provider.
If you do satisfy these criteria, you can benefit from ECO and central heating grants, regardless of what company you buy your energy from. You don’t need to purchase it from one of the obligated suppliers.