The results to the consultation on the future of the Energy Company Obligation have been announced by DECC.
The key results are;
The consultation sought views across England, Scotland, and Wales on a range of proposed changes to ECO. We have now carefully considered all the views expressed.
Changes to apply in relation to the current obligation period finishing on 31 March 2015:
- The March 2015 Carbon Emissions Reduction Obligation (CERO) target will be reduced by 33 per cent, with the inclusion of loft insulation, cavity wall and District Heating Systems (DHS) as eligible measures if installed on or after 1 April 2014.
- The March 2015 Carbon Saving Community Obligation (CSCO) and Affordable Warmth (also known as the Home Heating Cost Reduction Obligation (HHCRO)) targets will remain the same.
- Eligibility for the CSCO element of ECO is extended from 15 per cent to approximately the 25 per cent lowest areas on the Index of Multiple Deprivation. In addition, the qualifying criteria for the CSCO rural sub obligation will be simplified by allowing energy suppliers to deliver against this sub-target to any domestic property located in approximately the poorest 25 per cent of rural areas, as well as to households in rural areas who are members of the Affordable Warmth Group. These changes will apply for measures installed from 1 April 2014.
Changes to apply for the first time in relation to a new obligation period commencing on 1 April 2015:
- The ECO scheme will be extended to March 2017 with new targets imposed for CERO, CSCO and Affordable Warmth at a pro rata of the new March 2015 levels.
- Overachievement against March 2015 targets can be carried forward to count against March 2017 targets, subject to certain criteria. In the case of Affordable Warmth, only measures installed from 1 January 2014 may be carried forward and, if so, they will be subject to an ‘exchange rate’ which equalises the value across both ECO periods.
- A deflated Affordable Warmth score will apply for replacement gas ‘qualifying boilers’.
- An uplifted Affordable Warmth score will apply for insulation measures and ‘qualifying boilers’ in households whose main space heating systems are ‘non-gas’.
- A new measure, a ‘qualifying electric storage heater’, will be introduced under Affordable Warmth. The savings from repair or replacement of a ‘qualifying electric storage heater’ will be scored in the same way as a ‘qualifying boiler’ and in doing so, receive a higher notional bill saving.
- All replacement boilers and electric storage heaters delivered under Affordable Warmth will be required to include a minimum warranty.