The United Kingdom’s government has set a goal of becoming carbon-neutral by 2050. In 2019, legislation was enacted into law committing the government to a legally enforceable goal of net zero emissions by that year. The legislation aims to expand on the UK’s carbon emission reductions while also creating green jobs.

The government’s response to the Energy Company Obligation (ECO3) consultation outlines the scheme’s policy, which will operate from Autumn 2018 to March 2022. The scheme provides energy efficiency and heating improvements to households in the United Kingdom. The programme began in April 2013 and has since been updated. The most recent policy, ECO3, went into effect on December 3, 2018, and it applies to initiatives performed after October 1, 2018. The following are the scheme’s other major policies:

  • Concentrating the entire programme on low-income, vulnerable, and fuel-poor households
  • 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% from 2020 reducing the current supplier obligation threshold of 250,000 customer accounts (or equivalent) for the scheme in a phased manner to 150,000 customer accounts (or equivalent) from 2020
  • Allowing up to 10% of a supplier’s requirement to be met by the delivery of new, innovative solutions assisting families with broken heating systems by permitting the replacement of 35,000 faulty heating systems per year
  • Allowing the replacement of inefficient heating systems (outside of the broken heating system cap) if they are installed alongside insulation, requiring the treatment of at least 17,000 solid walled homes per year, either through solid wall insulation or a combination of other technologies (if equivalent savings can be achieved in the property)

How does the ECO3 Programme work?

One of the tools introduced by the government to help attain the aim of carbon neutrality is the energy company obligation (ECO3) plan. ECO3 funding exists to support energy efficiency renovations to households that reduce emissions, electricity, and energy bills, among other things. These grants are used to fund new heating systems, such as boilers, loft or cavity wall insulation, and other measures aimed at improving energy efficiency and reducing fuel poverty.

Can I Receive An ECO3 Grant?

The Home Heating Cost Reduction Obligation is a requirement of the ECO3 plan for medium to large energy suppliers in the UK (HHCRO). This responsibility, according to OFGEM, requires suppliers to promote the installation of measures that result in financial savings on energy bills, such as the ones indicated above (ie. insulation and heating systems).

But if I don’t qualify, what can I do? Is the green deal a possibility? Read more on the Green Deal.

ECO3 Scheme Property Eligibility

The EPC rating determines whether a home is eligible for the ECO3 Scheme. When a property is developed, sold, or rented, the government requires an Energy Performance Certificate (EPC). The EPC contains data on your home’s energy use and typical energy costs, as well as recommendations for saving money by reducing energy use. The ECO3 Programme EPC grade D, E, F, or G is required for properties to be eligible.

Tenant / Homeowner Eligibility For ECO3 Funding

The renter or end-user (i.e. the person or people residing in the property) must be a recipient of one or more of the state aids, benefits, allowances, or credits listed below in order to be eligible for ECO3 funding. The list is subject to change, and the most recent version may always be accessed on OFGEM’s website.

Even if you don’t qualify for the perks, allowances, or credits listed below, you may be eligible for alternative government subsidies, such as the Green Homes Grant, which was announced in late 2020. If you get one of the benefits listed below and your household satisfies the income criteria, you may be eligible for a grant under the Energy Company Obligation or ECO3 scheme. The following are some of the advantages:

  • Independence of the Armed Forces Attendance Allowance Payment
  • Allowance for Carers
  • Consistent Attendance (Child Benefit) Allowance
  • Allowance for Living (DLA)
  • Credit for Pension Guarantees
  • ESA (Employment and Support Allowance) based on income (ESA)
  • Jobseeker’s Allowance is depending on your income (JSA)
  • monetary assistance
  • Injuries in the Workplace Benefits for Disabilities
  • Supplement for Mobility
  • Payment for Individual Independence
  • Allowance for Severe Disabilities
  • Credits for taxes (Child Tax Credits and Working Tax Credits)
  • Universal Credit (UC) 

If you reside in social housing with an EPC rating of E, F, or G, you may be eligible for a grant. Use this free online Government tool to find out what your home’s EPC rating is; all you need is your postcode!

To take advantage of the ECO scheme, you don’t have to be a homeowner; however, if you’re a tenant, you’ll need permission from your landlord, social housing provider, or property management company. You do not need to apply for a grant with any particular energy company; because they are all required by the government to meet specified reduction targets, the ECO3 installer can try to secure financing for your measures from any of the medium to large energy firms.

Houses with old and outdated heating systems and a lack of insulation, particularly those with cavity walls or older properties, are the most effective in obtaining fully financed solutions, in our experience. In layman’s words, the less efficient a home’s heating system is, the more likely it is that measures will be fully supported. This is especially true if you do not have a gas heater in your home.

Read more on what you personally can do to reduce energy costs in your home.

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