Energy Company Obligation (ECO)

The obligations were the Carbon Emissions Reduction Obligation (CERO), the Carbon Saving Community Obligation (CSCO) and the Home Heating Cost Reduction Obligation (HHCRO). CSCO also had a sub-obligation focused on rural areas (the CSCO rural sub-obligation). Under ECO1 suppliers were required to achieve an overall target of 12.4 Mt CO2 for CERO, 6 Mt CO2 for CSCO and £3.7billion for HHCRO. Suppliers achieved 18.33 Mt CO2 under CERO, 9.87 Mt CO2 under CSCO, including 1.79 Mt CO2 under the rural sub-obligation, and £5.16billion under HHCRO.

The next obligation period, known as ECO2, launched on 1 April 2015 and ended on 31 March 2017. Suppliers were required to achieve the following cost and carbon savings - 19.7 Mt CO2 under the Carbon Emissions Reduction Obligation (CERO), 6 Mt CO2 under the Carbon Saving Community Obligation (CSCO) and £6.46 billion under the Home Heating Cost Reduction Obligation (HHCRO).

The government extended the ECO2 policy until 30 September 2018 with a new period termed ECO2t. Energy suppliers were required to achieve 7.3 Mt CO2 for the Carbon Emissions Reduction Obligation (CERO) and £2.76 billion for the Home Heating Cost Reduction Obligation (HHCRO). The Carbon Saving Community Obligation (CSCO) target had to be achieved by 1 April 2017, while the CERO and the Home Heating Cost Reduction Obligation (HHCRO) targets had to be achieved before 1 October 2018.

ECO3 policy was entirely formed from one obligation, the Home Heating Cost Reduction Obligation (HHCRO). Under HHCRO, obligated suppliers would have mainly promoted measures that improve the ability of low-income, fuel-poor and vulnerable households to heat their homes. This included actions that resulted in heating savings, such as the replacement of a broken heating system or the upgrade of an inefficient heating system. The ECO3 Order commenced on 3 December 2018 and ran until 31 March 2022. The ECO (Amendment) Order 2019 came into force on 1 January 2020. The ECO3 Order overall target for the HHCRO was £8.253 billion in cost savings.

The ECO3 final determination report provides details on overall scheme performance and our final determinations of energy suppliers’ achievement against their obligations.