The end of ECO
The Autumn Budget brings major implications for the retrofit sector, most notably the decision to end the Energy Company Obligation (ECO) scheme in March 2026. Redirecting some funding to short-term energy bill reductions will be welcomed by households, but it leaves a gap in long-term fabric improvement.
Serious concerns have emerged about the performance of works delivered under ECO, with the National Audit Office reporting that 98% of assessed solid wall insulation installations required major corrective action. The issues identified – weak oversight, inconsistent standards, insufficient auditing, and fragmented consumer protection – highlight fundamental problems in how retrofit quality has been governed.
With ECO now ending rather than being reformed, attention shifts entirely to the forthcoming Warm Homes Plan, which cannot afford to fail. For the plan to succeed, it must take a very different approach: with strong regulation and a commitment to materials and systems that deliver reliable, long-term performance.
That includes giving far greater recognition to natural fibre insulation (NFI) and other vapour-open, moisture-buffering materials that improve indoor air quality, reduce mould risk, and work effectively with the UK’s older and traditionally built housing stock.
With “6 million children in the UK living in fuel poverty” and many homes suffering from damp, mould and poor fabric condition, the Warm Homes Plan must prioritise safe, durable, high-performance retrofit solutions. The choice of materials — not just the quantity of installations – will be central to avoiding the failures seen under ECO.
“As the ECO scheme comes to an end, the Warm Homes Plan must raise the bar – prioritising proven, high-performance solutions such as natural fibre insulation and other breathable materials that support healthy, resilient buildings. If the UK is serious about improving its ageing housing stock, material quality, moisture safety and long-term performance must sit at the heart of retrofit policy.” – Richard Broad, Director, Alliance for Sustainable Building Products (ASBP)
The Budget also confirmed that government will not move ahead with a single-rate landfill tax by 2030. The proposed change could have imposed dramatic cost increases across the construction sector, but its withdrawal should not diminish the need for a clear strategy on waste reduction, reuse and circularity – areas where ASBP members continue to drive innovation.
Lastly, we welcome the announcement of £48 million over the next three years to boost capacity and capability in the planning system. The funding will be spread across Defra, the Ministry for Housing, Communities and Local Government (MHCLG), and the Department for Science, Innovation and Technology (DSIT).