Care & Repair Cymru Reacts to UK Government’s Decision to Scrap ECO

The end of a UK-wide fuel poverty programme risks leaving vulnerable households in Wales without vital support.

Care & Repair Cymru warns that the UK Government’s decision to end the Energy Company Obligation (ECO) from March 2026 without a replacement programme in place, risks leaving vulnerable households without essential fuel-poverty support.

The decision to abolish the UK’s only nationwide fuel poverty scheme risks putting increased pressure on services from people who would otherwise have been supported by ECO. In Wales, the Welsh Government’s Warm Homes Programme is now the country’s only major fuel poverty scheme available to homeowners and private tenants. This additional pressure could lead to longer waiting times, leaving vulnerable people living in cold homes which are unaffordable to heat and have a major detrimental impact on health and well-being.

The Autumn Budget confirmed that ECO will end in March 2026, with no replacement programme announced. ECO is currently the only UK-wide scheme providing home energy-efficiency improvements to those living outside the social housing sector. Its removal, along with other green levies, was motivated by the UK Government’s pledge to cut energy bills, and this move is expected to reduce the average household energy bill by around £150 a year.

Care & Repair’s Home Energy Officers utilise the most recent iteration of the scheme, ECO4, regularly through the charity’s Older Not Colder service. Despite its flaws, ECO4 in many cases has reduced bills, improved energy efficiency of homes and delivered clear health benefits for clients; it has funded new energy-efficient heating systems, solar panels and home insulation for hundreds of Care & Repair clients over its lifetime. However, the current phase of the scheme has faced significant issues including installation failures, inadequate quality assurance and limited routes for redress.

To offset the impact of scrapping ECO, the Chancellor announced £1.5bn for a new Warm Homes Plan, but only for England. Wales will receive consequentials, but there is no guarantee this funding will be directed towards fuel poverty measures.

Care & Repair is calling on the Welsh Government to commit all Warm Homes Plan consequentials to tackling fuel poverty and improving energy-efficiency, warning that failing to do so could leave vulnerable households out in the cold.

Becky Ricketts, Project Manager of  Care & Repair’s  Older Not Colder  service which provides free home energy support to help older people keep their homes warm and energy bills down, says:

“Whilst we welcome the estimated £150 reduction to energy bills, we are concerned by the scrapping of ECO, and the failure of the UK Government to announce any alternative. ECO should be replaced by a targeted measure to address fuel poverty and improve energy efficiency, and we would like to see confirmation of this as quickly as possible to avoid prolonging the current uncertainty.

“A new scheme must be introduced to help reduce fuel poverty and increase the energy efficiency of Welsh homes, to prevent older and vulnerable people being left living in cold homes. Good health and good housing are linked, and the failure to replace ECO risks increased pressures on services such as Wales’ Warm Homes Programme. This then leads to longer waiting times which will have negative impacts on both housing conditions and the health of our clients. Not only this, but without diverting UK Government consequential funding into the Warm Homes Programme, the Welsh Government’s ambition of net zero by 2050 is likely to fall far short.”

Care & Repair Recommends:

• Replace ECO with a targeted scheme to address fuel poverty and improve home energy efficiency. This replacement scheme should learn from the failings of ECO4 and include strengthened consumer protection measures with all contractors being required to sign a ‘code of practice’ with robust enforcement measured if contractors do not meet the required standards.
• Increased investment in fuel poverty initiatives in Wales. We urge Welsh Government to use the full yield of UK Government’s Warm Homes Plan consequentials towards tackling fuel poverty and improving the energy-efficiency of Welsh homes to address avoidable heath inequalities.
• The implementation of a national Safety-Net Grant to tackle hazardous disrepair across Wales where the owner-occupier has no means to improve the home themselves. Housing disrepair causes energy inefficiency and there is a lack of support for older people with no resource to make repairs necessary to live independently in warm, safe, accessible homes.