Major changes will be made to the Government’s ECO scheme, in an effort to reduce household bills by as much as £50 every year. This announcement comes in the wake of Labour’s pledge to freeze energy bills and the recent price hikes from the UK’s big six suppliers, including British Gas, Npower and EDF.
Details have yet to be fully finalised, with MPs still hopeful of reversing the Coalition’s proposals. And if the plans do come into effect, it will damage current schemes which benefit low income households and those with ‘hard-to-treat’ properties.
How will the plans affect me?
Effectively, the Government are looking to reduce the amount of green tax paid by homeowners. This means that less money will be used for schemes such as the Energy Companies Obligation (ECO).
As such, the scheme will be extended to March 2017, but less funding available on a yearly basis, halving the amount on offer. Plans are also in place to take funding for the Warm Homes Discount out of tax rather than customer energy bills.
The average energy bill has risen astronomically in the last few years. In fact, since 2007 your gas and electricity bills have risen 41% and 20% respectively. This has pushed many people into fuel poverty, unable to afford their expensive bills.
And whilst the major energy suppliers have blamed the Government’s green taxes for the rise, some MPS are warning the Coalition not to take their eye off the long term plan to improve energy efficiency in the home. Many have argued that these changes will merely act as a short term solution, rather than a long term goal.
What should I do?
So with these proposals, where does this leave you and improving your own home energy efficiency? If you still want to utilise the ECO scheme, our advice is to act quickly, before the cuts come into force.
The funding includes replacement boilers, wall cavity insulation and solid wall insulation, and with these improvements you’ll see hundreds of pounds in savings on your annual bills.
Of course, the scheme is extended, but it’s not yet clear how the funding will be affected when it comes to individual payments.
Even if you aren’t eligible to receive funding through the ECO, it’s still essential to improve the efficiency of your home. Payback for loft lagging and wall cavity insulation can be as little as two years, whilst a replacement boiler offers a range of excellent benefits.