Energy firms ‘have banked’ £1bn Eco funds

Energy companies have banked more than £1 billion from a levy on bills to cover improvements in energy efficiency in UK homes under the Energy Company Obligation (Eco) scheme while only a fraction of the projected installations have been done according to recent research by local authorities.

The Local Government Association (LGA) claimed government figures show that only 25 per cent of the targeted number of measures for cutting heating bills in low income households have been completed.

The LGA has called on government to step up the pace of installations.

“Energy companies are collecting this money through a levy which is contributing to the cost of fuel bills and they have an obligation to invest it as swiftly and effectively as possible to deliver upgrades which save vulnerable people money and keep them warm and healthy this winter,” said chairman of the LGA’s environment and housing board Councillor Mike Jones,

Eco is at the centre of political deliberations to remove the cost of green measures from energy bills and there are concerns that it could be scrapped or substantially reduced.

Chief executive of energy suppliers’ and producers’ trade body Energy UK, Angela Knight, said Eco charges were being introduced gradually to avoid a single large increase at a later date.

“Unfortunately, there is no easy option – you can bounce bills around or you can try to spread the price more evenly,” Knight said.

She said the slow start to Eco was a lull following the previous energy efficiency schemes end of the old scheme and gearing up for Eco.