ECO4 (Energy Company Obligation): Warm homes plan funding

ECO4 explained, and why it matters under the Warm Homes Plan

ECO4 is the most generous home energy grant most people will ever qualify for, and it is one of the schemes the Warm Homes Plan is folding in and then replacing. Within the wider Warm Homes Plan funding picture, ECO4 is the fully funded, whole-house route for fuel-poor households. It is the fourth phase of the Energy Company Obligation, run by Ofgem and paid for by the obligated energy suppliers, and it pays for insulation, first-time central heating, heating-system upgrades, heat pumps and solar PV at no cost to eligible homes. The defining word is whole-house. ECO4 takes a fabric-first approach and bundles several measures into one home rather than installing a single thing, so an eligible household often receives insulation and a heating upgrade together. Whole-house retrofit packages frequently exceed 15,000 pounds in installed value, and the household pays nothing.

It matters now more than ever because the window is closing. ECO4 runs to 31 December 2026 after a nine-month extension, with the final IM or DLM application date of 31 March 2026. The government has confirmed there will be no ECO5. From 2027 the supplier-obligation model is replaced by the Warm Homes Plan, which channels funding through the Warm Homes: Local Grant, the Boiler Upgrade Scheme and a new finance route instead. So if you are eligible for ECO4, the honest position is to apply now while the scheme is live, because the successor routes work differently. We track that transition so you do not apply to a scheme that has already shut.

What a typical ECO4 package looks like and how eligibility is assessed

ECO4 is matched to a household rather than sized in kilowatts, so the assessment is about eligibility and the right sequence of measures, not a system specification. The route is income and benefit-led. It targets homes in EPC band D to G occupied by households on qualifying means-tested benefits, including Universal Credit, Pension Credit, income-based JSA or ESA, Income Support, Housing Benefit and Tax Credits. Where a home qualifies, a retrofit assessor surveys the property and models the right measures in the right order, insulation before heating, so the package is documented rather than a one-size install. A typical ECO4 package might combine cavity wall and loft insulation with an air source heat pump and smart controls, with the value of the installed measures often exceeding 15,000 pounds and the cost to the eligible household being nothing.

This is where many people miss out. Plenty of eligible households never apply because they assume they will not qualify, or they do not know whether to contact a supplier, a council or an installer. ECO4 specifically is applied for through an obligated energy supplier or a TrustMark-registered installer. We run you through whether you meet the benefit and EPC tests in a couple of minutes rather than letting an assumed no cost you a fully funded retrofit.

Private renters are eligible under ECO4 as well, which surprises many tenants who assume the schemes are owner-occupier only. A rented home in EPC band D to G, lived in by a household on a qualifying benefit, can receive ECO4 measures with the landlord's permission, since the work is a physical improvement to the building. Off-gas-grid and rural homes are an important case too. They often face higher heating costs and patchier scheme coverage, and ECO4's fabric-first, whole-house approach is frequently the most valuable route for them, since first-time central heating and a heat pump can both fall within a single funded package. We check the benefit and EPC position regardless of tenure or location, rather than assuming a rural or rented home is out of scope.

Costs, what you pay, and tax relief

For eligible households ECO4 is free, so there is no payback to calculate. The value sits in the installed measures, which is 0 pounds to the household and fully funded, with whole-house packages frequently worth more than 15,000 pounds. There is no income test on the value, and no repayment, because ECO4 is a grant funded by the energy suppliers, not a loan. For households who fall just outside the benefit thresholds, the Warm Homes Plan introduces a new low or zero-interest finance route to help bridge the cost of measures that grants no longer cover, which is worth knowing if you are close to but not over the line. The Annual Investment Allowance and Smart Export Guarantee are commercial mechanisms rather than ECO4 features, so they apply to business installs rather than this domestic route. Our cost guide explains where the free schemes end and finance begins.

It helps to see why a whole-house ECO4 package can be worth so much more than a single measure. Because the scheme is fabric-first and bundles measures together, an eligible home might receive cavity wall insulation, loft insulation, first-time central heating where there is none, and a heat pump, all in one funded project. Each measure on its own would cost a household money, and together they can exceed 15,000 pounds in installed value, all of it covered. That is what makes ECO4 the most valuable route in the Warm Homes Plan funding picture for those who qualify, and why an eligible household should not delay while the scheme is still open to applications.

Funding routes in detail

ECO4 is the route in its own right here, but it rarely stands completely alone. If a home needs only a single insulation measure rather than a whole-house package, the Great British Insulation Scheme may be the better fit, and many households use the Boiler Upgrade Scheme for a heat pump alongside a separate scheme for the fabric work. For homes that do not meet the ECO4 benefit test, the council-delivered Warm Homes: Local Grant uses an income-based route instead and can fund a similar insulation plus low-carbon heating package. You can read the official scheme rules on the Ofgem Energy Company Obligation (ECO4) page, and we will tell you which combination of routes gives the most funded measures for your specific home.

It is also worth understanding what comes after ECO4, because the transition is the whole point of the Warm Homes Plan. Once ECO4 closes at the end of 2026, funding does not stop, it changes shape. The around 15 billion pounds committed under the Warm Homes Plan to upgrade up to five million homes by 2030 continues through the Warm Homes: Local Grant, the Boiler Upgrade Scheme and a new low or zero-interest finance route. So a household that misses the ECO4 window is not without options, it simply moves to a successor route. The reason we still treat ECO4 as urgent is that it is the most generous, fully funded whole-house route, and while it is open it is usually the best deal an eligible household will get.

Compliance and sector considerations

Every ECO4 measure is installed to TrustMark and PAS 2035 retrofit standards. That means a qualified retrofit assessor surveys the home, a retrofit coordinator plans the measures in the right order, and the completed work is registered with TrustMark and guaranteed, which is also your route to redress if anything goes wrong. The scheme timeline is a compliance point in itself, ECO4 runs to 31 December 2026 with a final application date of 31 March 2026, and there is no ECO5, so the dates are firm. Heat pumps installed under the package must be MCS-certified, and installers must belong to a consumer code, RECC or HIES. Most measures fall under Permitted Development, though solid wall insulation can need planning in a conservation area and heat pumps have siting and noise conditions under MCS 020.

How we approach this kind of project

We start by checking the two tests that decide ECO4, your benefit status and your EPC band, before anything else, so we do not raise hopes or waste your time. We only refer to MCS-certified and TrustMark-registered installers who follow the PAS 2035 fabric-first process, we flag exactly which scheme is paying for which measure, and we point you to the official Ofgem and gov.uk sources so you can verify everything. Critically, we work to the deadline, because the final ECO4 application date is 31 March 2026, we treat an eligible enquiry as time-sensitive and make sure the paperwork goes in before the window closes rather than after it.

We are also clear that ECO4 is a documented, surveyed process rather than a quick install, and that protects you. Under the PAS 2035 whole-house framework a qualified retrofit assessor surveys the home, a retrofit coordinator models the right measures in the right order, and the completed work is registered with TrustMark and guaranteed. That means you get a written plan showing which measures will be installed and why, not a one-size package decided on the doorstep, and you have a clear route to redress through TrustMark if anything is not right. We always recommend checking an installer's TrustMark and MCS registration yourself before signing anything, and we will never ask for upfront payment, because ECO4 measures are funded by the energy suppliers, not by you. If anyone calls offering ECO4 in exchange for bank details or a deposit, that is a warning sign, and we will say so.

An illustrative example

As an illustrative composite based on a typical ECO4 route, consider a 1960s semi-detached owner-occupied home in EPC band E, occupied by a family receiving Universal Credit, with an old gas boiler, no cavity insulation and a draughty single-glazed back room causing high winter bills and damp on the north wall. Under ECO4 the home could receive cavity wall and loft insulation, a new air source heat pump and smart heating controls as one whole-house package, installed under PAS 2035 with TrustMark lodgement at no cost to the family. In an illustrative case the EPC might move from E to C, the damp resolved once the fabric-first insulation was in, and the application lodged through an obligated supplier before the 31 March 2026 deadline. The figures and outcome are illustrative and depend on your property, your eligibility and the live scheme rules.

Think you might qualify? Read the wider grants and funding guide, check what is and is not free on the cost page, then tell us about your home before the ECO4 window closes. You can also browse the funding FAQs, or compare ECO4 with the Great British Insulation Scheme and the Warm Homes: Local Grant.