"Major" Faults Found in UK Energy Efficiency Scheme: 22,000-23,000 Homes Affected

Strategic Insights -

A scathing report by the National Audit Office (NAO) has revealed widespread issues with the Energy Company Obligation (ECO) scheme, designed to tackle fuel poverty and reduce carbon emissions by installing energy efficiency measures in homes. The report has exposed "clear failures" in the design and setup of the scheme, leading to poor-quality installations and suspected fraud.

Tens of thousands of UK homes fitted with energy efficiency measures under the ECO scheme have developed "major" faults such as damp and mould, posing "immediate health and safety risks" to occupants. The report estimates that 22,000 to 23,000 homes with external wall insulation have serious issues, 6% of which present immediate health and safety risks. Internal insulation in 9,000 to 13,000 homes also has serious faults.

Possible explanations for these issues include an under-skilled workforce, sub-contracted work to individuals and firms that are not competent or certified, uncertainty over which standards apply, and businesses "cutting corners" when undertaking design and installation work. The government's Warm Homes Plan has been criticized for not addressing these issues, with campaigners calling for reforms to prioritize quality over speed.

Key Takeaways:

  • The National Audit Office (NAO) report has exposed widespread issues with the Energy Company Obligation (ECO) scheme, designed to tackle fuel poverty and reduce carbon emissions.
  • 22,000 to 23,000 homes with external wall insulation have major issues, 6% of which present immediate health and safety risks.
  • Internal insulation in 9,000 to 13,000 homes also has serious faults, with 29% of the total.
  • Possible explanations for these issues include an under-skilled workforce, sub-contracted work to individuals and firms that are not competent or certified.
  • Businesses may have cut corners when undertaking design and installation work.
  • The government's Warm Homes Plan has been criticized for not addressing these issues.

Statistics:

  • 22,000 to 23,000 homes with external wall insulation have major issues.
  • 6% of homes with external wall insulation present immediate health and safety risks.
  • 9,000 to 13,000 homes with internal insulation have serious faults.
  • 29% of internal insulation installations have serious faults.
  • Up to £165 million worth of suspected fraud may have been claimed under the ECO scheme.
  • Businesses may have falsified claims for ECO installations in between 5,600 and 16,500 homes.

Sources:

  • "Energy Company Obligation: Major Issues in Solid Wall Insulation", National Audit Office (2023).
  • "Government's Warm Homes Plan Must Guarantee Quality", End Fuel Poverty Coalition (2023).
  • "Unacceptable, Systemic Failings in ECO Scheme", Department for Energy Security and Net Zero (2023).