Secondary legislation changing the Energy Company Obligation 4 (ECO4) and the Great British Insulation Scheme (GBIS) is due to come into force from July 2025, the Department for Energy Security and Net Zero has confirmed in a final stage impact assessment published on 7 April 20251. The changes follow a public consultation held in November 2024, which received 122 responses1.
The government response sets out three main changes: allowing two measures out of floor, loft and cavity wall insulation to be installed simultaneously as part of a GBIS project; allowing smart thermostats to be installed in the low-income group; and allowing delivery achieved under ECO4 rules to count towards an obligated supplier's GBIS target1. The original GBIS policy did not allow multiple measures to be installed in one household, only a single measure1.
"The preferred option will be given effect via secondary legislation, due to be laid in May and come into force from July 2025."
GBIS was estimated to be a £1 billion obligation on energy suppliers, running between Spring 2023 and March 2026, and originally aimed to deliver 55,998,000 in annual bill savings1. Delivery has fallen short: as at the end of December 2024, 46,887 homes had been treated under GBIS, with 58,975 measures installed1. The department states that the average GBIS cost is reported by suppliers to be £26.03 per annual bill saving, much higher than assumed in the original impact assessment1.
| GBIS delivery as at end December 2024 | Count |
|---|---|
| Total number of homes | 46,887 |
| Low-income group | 17,111 |
| General group | 29,579 |
| Total number of measures | 58,975 |
| Loft insulation | 16,295 |
| Cavity wall insulation | 24,778 |
| Under floor insulation | 144 |
| Solid wall insulation | 3,254 |
| Heating controls | 12,093 |
The department says the changes aim to address delivery problems including a constrained supply chain, competition from ECO4, fixed scheme costs recoverable under the energy price cap, and the move to single measure projects with relatively higher fixed costs1. It states that the changes should improve delivery and increase confidence that the overall cost of compliance meets the original £1 billion estimate1.
Why it matters for households
ECO4 and GBIS place a legal obligation on larger energy suppliers to deliver energy efficiency measures to eligible households, with ECO4 covering a range of households including those in EPC D to G homes and those on means tested benefits1. For a household, the practical effect of the July 2025 changes is that a single GBIS project may now include two insulation measures rather than one, which the department says spreads the fixed costs of compliance over more measures and reduces the cost of delivering annual bill savings1. Smart thermostats become available to the low-income group, where previously only certain other control types were eligible1. The department states that heating controls, of which smart thermostats form a part, can improve energy efficiency by reducing heating hours when heat is not required1. The rules governing how installers are certified and how consumer codes apply to this work are set out in the Installer Schemes and Consumer Codes guidance, with TrustMark as the government-endorsed quality scheme. Wider policy context sits in the regulation and policy section.
What happens next
The secondary legislation was due to be laid in May and come into force from July 20251. Both ECO4 and GBIS are due to end on 31 March 2026, with final reconciliation to be done at the end of the scheme in March 20261. The department states that the increase in delivery will be measured by Ofgem, the scheme administrators1.