Legislation came into force on 25 July 2023 creating legal obligations for large and medium-sized energy suppliers under the Great British Insulation Scheme if they meet the obligation threshold, according to Ofgem, which administers the scheme1.
Ofgem states that the threshold is "determined by customer numbers and supply volumes", which the regulator requests from suppliers at specific times1. The scheme is a government energy-efficiency programme, administered by Ofgem in Great Britain, and is "designed to deliver improvements to the least energy-efficient homes in Great Britain to help tackle fuel poverty and reduce carbon emissions"1.
As scheme administrator, Ofgem sets suppliers' obligations using a calculation based on their share of the gas and electricity supply market, under legislation referred to as the ECO4A Order1. Suppliers are responsible for meeting their obligations and for ensuring that they, and any members of the supply chain acting on their behalf, comply with scheme requirements1. Obligated suppliers may trade their obligations with other obligated suppliers1.
"Following legislation coming into force on 25 July 2023, large and medium-sized energy suppliers have legal obligations under the Great British Insulation Scheme if they meet the obligation threshold."
The scheme includes incentives intended to support delivery of innovative measures that provide further energy efficiency improvements or additional benefits, through the New Measures and Products innovation route1. Obligated suppliers notify Ofgem of measures delivered; Ofgem states it is "currently building a register" to allow measure notification and processing, and will contact relevant suppliers once the digital platform is ready1. A supplier data dictionary has been published to give suppliers advance notice of the information they may need to obtain for notification purposes1. Ofgem engages stakeholders through forums and working groups1.
Why it matters for households
The obligation falls on suppliers, not households, but it is the mechanism that funds insulation work in the least energy-efficient homes. Which suppliers carry an obligation, and how large it is, follows their share of the gas and electricity market rather than any local factor, so the availability of supplier-funded work under this scheme depends on the delivery arrangements suppliers put in place and on the eligibility rules that sit alongside it. For a household, the practical link between this and energy independence runs through the fabric of the home: loft, cavity, solid wall and other insulation reduce the heat a property loses, which reduces the energy it must buy to stay warm. How far that translates into bill savings varies by property and measure, and the scheme's own savings figures are not set out in this material. The scheme sits alongside other supplier-funded and grant routes, including ECO4 and the Warm Homes: Local Grant, and eligibility differs between them.
What happens next
Ofgem says it is building the register for measure notification and processing and will contact the relevant suppliers once the digital platform is ready1. No date for that has been reported.