Energy suppliers may apply for shared ground loop ground source heat pumps (GSHPs) to be approved as an innovation measure under the Energy Company Obligation (ECO4), following amendments to the ECO4 Order. The change took effect from 1 August 2025, according to Ofgem's guidance on new measures and products1.
The guidance states that the route is open because a shared ground loop GSHP is not treated as a district heating connection for these purposes. Ofgem's wording is:
"From 1st August 2025, suppliers may apply for shared ground loop GSHPs to be approved as an innovation measure as a result of the legislative amendments to the ECO4 Order"
Under ECO4, the new measures and products routes allow technologies that are not already recognised under the Standard Assessment Procedure (SAP) to be brought into the scheme. There are three routes: standard alternative methodologies (SAM), data light measures (DLM) and innovation measures (IM). Only obligated suppliers can apply; a manufacturer or installer in the supply chain must work with a supplier, which submits the application to Ofgem2. Participation in these routes is optional for suppliers2.
An innovation measure application must include the specific products the applicant intends to promote, and a successful application leads to a published measure description and a score uplift of either 25% or 45%2. Measures delivered under the innovation measure route are capped at 10% of a supplier's total obligation2. Data light measures are capped at 5,000 qualifying actions under any specific DLM type description, a change from the earlier cap of 1,250 qualifying actions per annum1.
| Item | Detail |
|---|---|
| Route for shared ground loop GSHPs | Innovation measure |
| Date suppliers could apply | From 1 August 2025 |
| Uplift available under the IM route | 25% or 45% |
| Cap on IM measures | 10% of a supplier's total obligation |
| Cap on each DLM | 5,000 qualifying actions |
The guidance also records that shared ground loop GSHP measures must be lodged with TrustMark, or an equivalent, and delivered by a TrustMark registered, or equivalent, business1. Ofgem's guidance is additional to its ECO4 Guidance: Supplier Administration and ECO4 Guidance: Delivery, and where guidance and the Orders conflict, the Orders take precedence2.
Why it matters for households
ECO4 is an energy efficiency scheme for Great Britain, first introduced in 2013, focused on supporting low-income, vulnerable and fuel poor households2. Shared ground loop systems serve more than one home from a common loop of buried pipework, so approval of a route into ECO4 matters to households that cannot use a standalone ground source heat pump because they lack the land for their own borehole or loop. For a home, the practical effect is that a networked ground source heat pump becomes a technology a supplier can seek approval for under the scheme, rather than one excluded because it is treated as a district heating connection. Whether any individual household can access funding still depends on the supplier choosing to apply and on the household meeting ECO4 eligibility rules, including the qualifying benefits tests. The guidance does not set out which homes or areas might be served, and no shared ground loop projects have been announced in these documents.
What happens next
Applications for innovation measures and data light measures will not be accepted after 31 March 2026, and applications received before that date will be considered2. Standard alternative methodology applications may still be submitted beyond 31 March 20262. The deadline follows an amendment made to the ECO4 Order in 20262. Ofgem's summary of updates records that ECO4 has been extended by nine months to 31 December 20261.
Sources2 cited
- ECO4 Guidance: New Measures and Products, ofgem.gov.uk
- ECO4 Guidance: New Measures and Products, ofgem.gov.uk