The Energy Company Obligation (ECO) Consists of one Distinction called Home Heating Cost Reduction Obligation (HHCRO) or ‘Affordable Warmth’ scheme. ECO4 is a government energy efficiency scheme in Great Britain to tackle fuel poverty and help reduce carbon emissions. The ECO scheme means that medium and large gas and electricity suppliers – including British Gas, EDF Energy, Eon, Ovo, Scottish Power and SSE are obliged to help households with energy efficiency measures such as Electric Storage Heaters, loft insulation, cavity wall insulation, solid wall insulation and boiler replacement or repair. The scheme provides funding to help eligible people reduce the cost of heating by installing energy efficient measures such as Storage Heaters, Loft, Floor, Cavity, IWI Internal Wall Insulation. ECO4 is currently being Upgrading and will be called ECO4 in 2022.

How ECO works

Under ECO, medium and larger energy suppliers fund the installation of energy efficiency measures in British households. Each obligated supplier has an overall target based on its share of the domestic energy market in Britain. The obligated energy suppliers work with installers to introduce certain efficiency measures into your home, such as loft, floor or wall insulation, or heating measures.

The obligation explained

The Home Heating Cost Reduction Obligation (HHCRO) requires energy suppliers to promote the installation of measures that lead to financial savings on energy bills, such as the installation of insulation and heating measures.


You are eligible for ECO if you own your own a home and live in it, or are in private rented accommodation, and are in receipt of any of the following benefits you will qualify for HHCRO funding: NB: To qualify the benefit recipient can be anyone that lives in the house as the end user for example disabled child, Grand parents or parents or spouse receiving a state benefit.

You are eligible for ECO if you receive at least one of the following benefits and satisfy the relevant income requirements, where applicable:
  • Armed Forces Independence Payment
  • Attendance Allowance
  • Carer’s Allowance
  • Child Benefit (on the condition that the household’s relevant income does not exceed the amount set out in Chapter 3 of our scheme guidance)
  • Constant Attendance Allowance
  • Disability Living Allowance
  • Pension Guarantee Credit
  • Income-related Employment and Support Allowance (ESA)
  • Income-based Jobseeker’s Allowance (JSA)
  • Income Support
  • Industrial Injuries Disablement Benefit
  • Mobility Supplement
  • Personal Independence Payment
  • Severe Disablement Allowance
  • Tax Credits (Child Tax Credits and Working Tax Credits)
  • Universal Credit

Alternatively, if you are living in social housing with an EPC rating of E, F or G you might also be eligible for the scheme. Social housing with an EPC rating of D can also qualify for an innovation measure. Further information on innovation can be found in our Innovation Guidance which will be published in due course.

If you are not receiving Any one of the Benefits Above you may still Qualify under The LA Flex Funding

LA Flex is an acronym for “Local Authority Eligibility Flexibility”. This programme is designed to help homeowners who are not currently receiving any type of aid but are still grappling with a tight budget. Companies that are approved by this scheme can provide you with massively reduced rates if the insulation within your home needs to be upgraded. Here are some of the benefits to enjoy:
1. Your heating bills could be reduced by hundreds of pounds each year.
2. Your home will be much more environmentally friendly; helping the local environment.
3. Rooms can remain warm in the winter and pleasantly cool in the summer.
4. Issues such as humidity, mould, and draughts will finally be eliminated.
5. The value of your home will increase as a result.
6. The only possible issue is that the majority of homeowners are unaware of the current LA Flex funding eligibility guidelines.