The ECO4 scheme is the latest phase of the UK government’s Energy Company Obligation (ECO) initiative. It is designed to improve the energy efficiency of homes, particularly for those in low-income and fuel-poor households. With rising energy costs and a growing need for sustainable solutions, this scheme plays a crucial role in reducing energy bills while cutting carbon emissions.
The ECO4 scheme offers grants to upgrade insulation, heating systems, and other energy-saving measures, ensuring that homes stay warmer for longer without excessive energy use. This article explores how the scheme works, who can benefit, and what improvements are available. It also explains how homeowners and tenants can apply and what to expect from the process.
The Energy Company Obligation (ECO) scheme is a government initiative that legally requires major energy suppliers to fund energy-saving home improvements. These improvements help reduce household energy consumption, lower heating costs, and contribute to the UK’s goal of achieving net-zero carbon emissions by 2050.
ECO4 is the fourth and most recent phase of this scheme, running from April 2022 to March 2026. It replaces ECO3 and brings a stronger focus on helping low-income households while prioritising whole-home energy efficiency. Unlike previous phases, ECO4 aims to provide long-term energy savings rather than temporary fixes by supporting comprehensive home upgrades.
One of the key changes introduced in ECO4 is the shift away from funding gas boiler replacements. Instead, the scheme encourages the installation of renewable heating systems such as heat pumps. The focus is also on improving the least energy-efficient homes, typically those with an Energy Performance Certificate (EPC) rating of D, E, F, or G.
The scheme is aimed at households that struggle with high energy costs, particularly those on low incomes. Eligibility is primarily based on government benefits, but some households may qualify through local authority schemes.
To be eligible, a homeowner or tenant must receive at least one qualifying benefit. These include Universal Credit, Income Support, Pension Credit, Child Benefit (with specific income limits), and other government assistance. The eligibility criteria also consider the energy efficiency of the home, as the scheme is designed to prioritise properties with poor insulation or outdated heating systems.
For households that do not receive qualifying benefits, there is still an opportunity to apply through the Local Authority Flexible Eligibility (LA Flex) scheme. This allows councils to assist individuals who are struggling with energy bills due to low income or health issues exacerbated by cold living conditions.
Private landlords can also apply for funding on behalf of their tenants, provided the property meets the necessary requirements. However, landlords must contribute towards the cost of the improvements in some cases.
ECO4 covers a wide range of energy-saving home improvements. The focus is on whole-house upgrades that provide lasting benefits rather than individual quick fixes.
A significant portion of ECO4 funding goes towards improving home insulation. Poorly insulated homes lose heat quickly, forcing households to use more energy to stay warm. By upgrading insulation, properties retain heat for longer, reducing the need for constant heating.
Loft insulation is one of the most effective upgrades, as a large percentage of a home’s heat is lost through the roof. Cavity wall insulation is another important measure, particularly for homes built after the 1920s. For older properties that lack cavity walls, solid wall insulation can be installed internally or externally to improve heat retention.
ECO4 places a strong emphasis on upgrading inefficient heating systems. However, unlike ECO3, this phase no longer provides funding for gas boiler replacements except in very limited circumstances. Instead, the scheme promotes the installation of renewable heating options such as air-source heat pumps.
Homes that currently have no central heating system may be eligible for first-time central heating installation. This can significantly improve comfort levels for households that rely on inefficient electric heaters or outdated storage heaters. In some cases, old and inefficient heating controls can also be upgraded, allowing residents to better manage their energy use.
The introduction of smart home technology is another area covered by ECO4. Installing smart thermostats can help homeowners and tenants control their heating more efficiently, leading to lower energy consumption. Some households may also receive funding for energy-efficient lighting, which reduces electricity use while providing the same level of brightness as traditional bulbs.
Applying for ECO4 involves several steps, but the process is relatively straightforward. By getting in touch with Green Homes Group today, we can provide guidance on eligibility and carry out a survey to determine which measures your home will benefit from most.
The first step is to check eligibility. Homeowners and tenants should confirm whether they receive qualifying benefits or if they can apply through their local council. They should also check their home’s EPC rating to ensure it falls within the eligible range.
Once eligibility is confirmed, the next step is to find an accredited ECO4 installer. The government provides a list of approved companies that carry out the assessments and installations. These installers will conduct a home energy assessment to determine which improvements would be most effective.
If the application is approved, the installer will arrange for the upgrades to be carried out. In most cases, the process is fully funded, meaning the homeowner or tenant does not have to pay anything. However, in certain situations, a small contribution may be required, depending on the type of work being carried out.
ECO4 is funded by major energy suppliers, including British Gas, EDF, E.ON, Scottish Power, and others. These companies are legally required to contribute to energy efficiency improvements as part of their obligations to the government.
The funding is provided directly to registered installers, who then carry out the necessary work in eligible households. This ensures that the scheme is accessible to those who need it most, without requiring applicants to source funding themselves.
In most cases, homeowners and tenants do not have to pay anything for the upgrades. However, in certain situations where the funding does not fully cover the cost of an improvement, a small contribution may be required.
ECO4 introduces several important changes compared to previous phases. One of the biggest differences is the reduced reliance on gas boilers. While previous schemes funded gas boiler replacements, ECO4 prioritises whole-home efficiency improvements and renewable heating systems.
Another significant change is the shift towards helping the most vulnerable households. The eligibility criteria have been expanded to include more low-income families, and greater emphasis is placed on properties with the lowest energy ratings.
ECO4 provides multiple benefits for homeowners, tenants, and the environment. By improving energy efficiency, households can enjoy lower energy bills and a more comfortable living environment. The upgrades also help to reduce carbon emissions, supporting the UK’s wider sustainability goals.
Additionally, homes that receive energy efficiency improvements often see an increase in property value. Buyers and tenants are increasingly looking for homes with better EPC ratings, making these upgrades a valuable investment.
Despite its many advantages, ECO4 is not without its challenges. One of the biggest limitations is that not all households qualify. Those who do not receive qualifying benefits may find it difficult to access the scheme unless they are eligible under local authority provisions.
Another challenge is the regional variation in funding availability. Some areas may receive more support than others, leading to delays in accessing improvements. Additionally, due to high demand, there may be waiting times for assessments and installations.
ECO4 is part of the UK’s wider strategy to achieve net-zero carbon emissions by 2050. As technology continues to develop, future schemes may place an even greater emphasis on renewable energy solutions and energy-efficient home designs.
The government may also introduce additional grants and incentives alongside ECO4 to encourage more homeowners to adopt sustainable energy solutions.
The ECO4 scheme is a vital initiative that helps low-income households improve their home’s energy efficiency while reducing energy costs. By providing funding for insulation, heating improvements, and renewable energy solutions, the scheme plays a key role in tackling fuel poverty and cutting carbon emissions.
For those who qualify, applying for ECO4 can lead to significant long-term benefits. As energy prices continue to rise, these improvements can make a real difference in ensuring homes remain warm and affordable to heat.
Learn more about you can improve your home energy-efficiency with our full range of services.
Introduction Air-source heat pumps are gaining popularity as an energy-efficient and environmentally friendly way to heat homes across the UK. With increasing energy prices and...
