The Energy Company Obligation (ECO4) is a government energy-efficiency scheme in Great Britain designed to tackle fuel poverty and help reduce carbon emissions.

ECO is an obligation placed on energy companies to deliver energy efficiency measures to domestic premises. ECO is not a grant scheme as such it is up to the energy companies to determine which retrofit projects they choose to fund, the level of funding they provide, and the Retrofit Coordinator and installers that they choose to work with.

ECO4 measures were delivered on 1 April 2022, and the scheme will run until 31 March 2026.

ECO4 focuses on improving the least energy-efficient homes and households in fuel poverty, as only properties in bands D-G can be treated. It also aims to deliver a more complete upgrade of those homes, shifting to a multi-measure whole-house retrofit approach. Furthermore, a minimum number of private tenure homes in energy efficiency rating bands E, F and G must be upgraded throughout ECO4, ensuring the least efficient homes are treated.

There is a new Minimum Requirement (MR) to improve the energy efficiency rating of band D and E homes to at least band C and band F and G homes to at least band D. ECO4 aims to encourage the installation of various energy efficient measures such as insulation measures, first-time central heating, renewable heating, and district heating connections.

When you pay your energy bills, 7% to 13% of that bill contributes towards environmental and social obligation costs, which pay towards the ECO scheme. With the increasing costs that consumers are currently facing to heat their properties, OFGEM has decided to extend ECO, introducing ‘ECO4’ to help reduce energy bills for those in the least energy-efficient properties around the country. OFGEM aims to improve the energy efficiency of homes significantly, shifting to a whole-house approach to make each property worked on as energy efficient as possible, reducing your bills as much as your property allows.