The Energy Company Obligation (ECO) is an energy efficiency programme to help reduce carbon emissions and tackle fuel poverty in Great Britain.

What is the ECO?

ECO places legal obligations and targets on the larger energy suppliers to fund energy efficiency measures in British households.

It is in place to support retrofit efficiency works in the domestic sector, with a particular focus on vulnerable consumer groups and hard-to-treat homes.

Under the rules of ECO, energy suppliers are obliged to fund energy efficiency improvements of their domestic customers’ buildings in three distinct areas; Carbon Emissions Reduction Obligation (CERO), Community Obligation (CSCO), and Home Heating Cost Reduction Obligation (HHRCO).


Under the Carbon Emissions Reduction Obligation (CERO) energy companies must concentrate on funding improvements in hard-to-treat homes.

Solid wall insulation and hard-to-treat cavity wall insulation, and connections to heat networks (also known as district heating systems), are the primary areas for focus under this target.


Under the Carbon Saving Community Obligation (CSCO), energy companies must focus on funding the provision of insulation measures and connections to domestic heat networks (notably Shared Ground Loop Arrays) in areas of low income.

There are sub-targets for rural and deprived areas. Because the criteria for these sub-targets are harder to meet energy suppliers are especially keen to look at projects within these categories.


Under the Home Heating Cost Reduction Obligation (HHRCO), energy suppliers are required to fund measures which improve the ability of low income and vulnerable households (the ‘Affordable Warmth Group’) to heat their homes. This includes actions that result in heating savings, such as the replacement or repair of a boiler for example.

Social housing providers are not eligible under the HHRCO element of ECO.

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