SEA recommends changes to the Energy Company Obligation (ECO) scheme

The Sustainable Energy Association (SEA) has published a report recommending changes to the Energy Company Obligation (ECO) scheme.

The SEA has outlined improvements that could be made to the energy efficiency scheme to help tackle fuel poverty in line with the Government’s objectives and calls for any successor scheme to take a multi-measure approach, enable innovation and deliver in-situ performance.

The report comes before the details of ECO4 – the next iteration of the scheme – are due to be outlined by the Government in 2021. The SEA hopes the Government will take lessons from its recommendations to drive targeted energy efficiency improvements in the worst performing homes.

2,064,700 households have benefited from the installation of energy efficiency measures since the introduction of ECO in 2013. This has generated lifetime emissions savings of ~ 49.0 MtCO2. However, the Government is still not on track to meet its target of upgrading every fuel poor home to EPC Band C by 2030.

The report focusses on three specific elements for a future ECO programme that would help the Government reach this target:

  1. The delivery model: The delivery of ECO is evolving to incorporate a whole house view, utilising the PAS2035:2019 standard to guide the installation process and sequencing of measures. This shift to a multi measure approach must incentivise the delivery of structural improvements and be accompanied by greater engagement with eligible households.
  2. Innovation routes: Although innovation routes were added to ECO in 2018, they have thus far had minimal impact on delivery. There are several administrative reforms that, if made, will drive greater deployment, and improve retrofit outcomes for the worst performing homes.
  3. In-situ performance: Similarly, an in-situ performance mechanism was introduced in 2018 but to date no obligated suppliers have sought to use it. This mechanism was introduced to support the deployment of real time data monitoring tools that have the potential to transform the retrofit and construction markets. However, there are challenges in the current model which if left unaddressed, will continue to stifle deployment through ECO. Therefore, additional incentives should be developed for suppliers to deliver their obligation through in-situ performance.

Jade Lewis, Chief Executive of the Sustainable Energy Association, commented: “It is essential that the Government takes on board these recommendations within the Energy Company Obligation. The pandemic has highlighted just how important it is that people feel safe and comfortable at home, and how the most vulnerable in our society are disproportionately affected by issues such as fuel poverty. To combat this, whilst progressing the housing sector to net zero, ECO must address the recommendations set out in the report.”

To see the report in full, visit: sustainableenergyassociation.com/resources/recommendations-for-a-future-energy-company-obligation/

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