Amendments made by the Electricity and Gas (Energy Company Obligation) (Amendment) Order 2025 (S.I. 2025/941) took effect on 1 August 2025, substituting articles 9(2) and 9(5) of the Energy Company Obligation Order 2023 and inserting smart meter advice requirements in article 221. The same instrument revised the rules covering insulation and heating control measures1.
The 2023 Order, made on 24 July 2023, sets an overall home-heating cost reduction target of £55,998,000 in annual cost savings for the period ending with 31st March 20261. That target is apportioned between licence-holders who are participants, and a participant must achieve its total home-heating cost reduction obligation by no later than 31st March 20261. The obligation runs in three phases: phase A, from the commencement date to 31st March 2024; phase B, the twelve months ending with 31st March 2025; and phase C, the twelve months ending with 31st March 20261. The qualification years are 2022, 2023 and 2024 respectively1.
Minimum achievement thresholds are set per phase. A participant must achieve at least 90 per cent of its home-heating cost reduction obligation for phase A and for phase B, and must have a combined score equal to or exceeding 90 per cent of its low-income minimum requirement for phase A1. Help to heat or social housing measures must have a combined score equal to or exceeding 20 per cent of the participant's low-income minimum requirement for phase A1. The Order lists low-income minimum requirement figures of £3,640,000 for phase A and £12,179,500 each for phases B and C1.
The Order defines an insulation measure to include cavity wall insulation, solid wall insulation, internal or external wall insulation, loft insulation, insulation of a habitable room's walls and ceiling in a roof space, flat roof insulation, pitched roof insulation, and insulation against heat escaping into the ground or space beneath the premises; for a mobile home it means insulation of the floor, walls and ceiling1. A heating control measure means a thermostat connected to a space heating system, or a type of control listed in sections 9.4.1 to 9.4.6 of the Standard Assessment Procedure1. Measures must be completed on or after 30th March 2023 and before 1st April 2026, at premises erected before 1st April 2022, and must not be funded by a grant made by a public authority1. Where premises are private rented premises in Scotland, the pre-installation band must be D or E1.
The Order extends to England and Wales and Scotland1. A separate instrument, S.I. 2025/802, substituted wording in article 2(2) with effect from 29th July 20251.
Why it matters for households
The Energy Company Obligation places the cost of certain home insulation and heating control work on energy suppliers rather than on the householder, so the amendment order changes the terms on which that work can be delivered. The new smart meter advice requirement in article 22 links the installation of measures to advice about smart meters, which is relevant to how a home's consumption is measured and understood afterwards. The revised insulation and heating control rules determine which measures count towards a supplier's obligation, and therefore which properties and which types of work fall within the scheme. The phase structure and the 31st March 2026 deadline set the timetable within which qualifying measures must be completed. The Order does not itself set out what a household will be offered or what it will pay; those details are not in the legislation.
What happens next
The obligation runs to 31st March 2026, with phase C covering the twelve months ending on that date1. Measures must be completed before 1st April 2026 to qualify1. No further amendments beyond those dated 29th July 2025 and 1st August 2025 have been reported1.
Sources1 cited
- The Electricity and Gas (Energy Company Obligation) Order 2023, legislation.gov.uk