E3G, an independent climate change think tank, published a briefing on 21 January 2022 setting out its case for retaining the Energy Company Obligation and the uplift planned for this year. The briefing states that cutting ECO or suspending the ECO4 uplift "must be taken off the table"1.
ECO is described as a UK government programme to tackle fuel poverty and reduce carbon emissions through energy efficiency and new heating technology installations. Measures are installed in the homes of those either in fuel poverty or otherwise considered vulnerable by energy companies, and the costs are recovered through a levy on bills1. The briefing says the scheme delivers new boilers, heating controls and energy-saving insulation measures to households that could otherwise not afford them1.
E3G states that ECO has saved low-income customers £17.5bn in lifetime energy bills since 2013, and that the average saving for homes improved under the scheme is £290 per year1. It also argues that without ECO the government cannot meet its statutory fuel poverty targets, and that removing or suspending the scheme would damage the levelling-up agenda1. On employment, the briefing states that cutting ECO would cost 30,000 jobs and decimate a critical industry1. It further argues that ECO is not a "green tax"1.
"Cutting ECO or suspending the uplift planned for this year would be deeply counterproductive for households and industry"
The briefing was written by Colm Britchfield and published on 21 January 20221. The full briefing document is available from E3G1. No government response to the briefing, and no decision on the ECO4 uplift, has been reported1.
Why it matters for households
ECO is one of the routes by which homes on low incomes or considered vulnerable receive insulation, heating controls and boiler replacements at no direct cost to the household, with the cost recovered through a levy on all bills1. For a household that qualifies, the practical effect is an improvement to the fabric and heating of the home without upfront payment, and E3G puts the average saving at £290 per year1. For households that do not qualify, the levy still appears on bills, which is the mechanism E3G addresses when it argues ECO is not a "green tax"1.
The briefing's central claim is that the scheme's future affects both groups: it argues that cutting ECO or suspending the uplift would be counterproductive for households and industry, and that statutory fuel poverty targets cannot be met without it1. The detail of how ECO4 operates, and how it sits alongside other grants and schemes, is set out in the site's guide pages.
What happens next
The briefing sets out no dated next steps. It states only that cutting ECO or suspending the ECO4 uplift planned for this year must be taken off the table1. No timetable for a decision on the uplift has been reported1.