The Energy Company Obligation (ECO), is a government scheme, designed to help tackle fuel poverty by improving the energy efficiency of vulnerable households in the UK.
ECO was first introduced in 2013. In April 2022 the fourth iteration of the scheme started and will run until 2026 – known as ECO4.
Throughout the lifetime of ECO a key problem has been how to accurately identify the households that are in need of and are eligible for support via the ECO funding.
In this article we’ll give an overview of how the ECO scheme works as well as the data needed to tackle the eligibility problem:
Under the ECO4 scheme, some energy companies are required to provide funding for energy efficiency improvements for homeowners or private tenants that:
ECO4 has also introduced additional funding via energy suppliers specifically for insulation, known as the ECO+ or Great British Insulation scheme.
Eligibility for ECO+ is different to eligibility for ECO 4 funding, as follows:
The ECO+ scheme is supporting the government’s new ambition to reduce the UK’s final energy consumption from buildings and industry by 15% by 2030, and is focused on rolling out predominantly low-cost insulation measures such as loft insulation and cavity wall insulation.
Currently 56% of all homes in the UK have an EPC below an EPC C rating.
Thanks to the new ECO4 and ECO+ support schemes, energy providers have a real opportunity to help with the decarbonisation of homes and reduce energy bills for the most in need.
Since the initial ECO scheme launched in 2023, it has helped 2.4 million households install energy efficient upgrades in their homes – a huge achievement.
However, throughout the scheme energy providers have expressed concerns around identifying the households with low energy efficiency and most in need of support with their fuel bills.
The ECO funding is also limited to certain energy efficiency improvements such as loft and cavity wall insulation, and energy providers need to be able to identify the households that qualify for such improvements, which adds another level of complexity.
With the right dataset, it should be easy for energy providers to understand which households are eligible for ECO funding and which energy efficiency improvements are possible for these households.
However, energy providers have largely relied on EPC data from the UK government’s EPC register to check ECO eligibility. This EPC data is incomplete, unreliable, and inaccurate.
Our research found that only 49% of UK homes have a valid EPC register, which means that 51% of homes don’t exist on the EPC register, leaving a huge blind spot for energy providers.
Furthermore, the data it does store is produced by a methodology that is 10 years out of date and built on many flawed assumptions.
Want to know more about the problems with EPCs as a source of data on UK housing energy efficiency? Our recent white paper ‘The (hidden) cost of free data’ explored the topic in detail.
Go to the white paper ➡️
EPC data, therefore, has made it very challenging for energy providers to accurately identify the properties most in need of support through schemes such as ECO4 and ECO+.
Ultimately, this is delaying the progress we need to get UK housing to Net Zero ASAP.
Kamma is building the single source of truth for environmental data relating to UK property.
We’ve mined and modelled hundreds of information sources to give the most complete and accurate view of the environmental impact of the built environment.
Kamma can help energy and housing providers identify the right homes and improvements for ECO funding by resolving the data issues to identify the under performing properties, prioritise the most impactful improvements, and accurately estimate costs. Targeting the most at need properties with the most cost effective solutions is more easily achievable than ever before.
Want to know more? Get in touch and a member of the Kamma team will get back to you.
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