Retrofit measures under ECO4 and GBIS

1 In brief
2 Background
3 Description
4 Response
5 Comments
6 Related articles on Designing Buildings

[edit] In brief

On 13 October 2025, Labour Minister Martin McCluskey updated Parliament on failings in solid wall insulation under ECO4 and GBIS, with audits finding 92% of external and 27% of internal installations non-compliant. In response, 38 installers were suspended, households were offered free audits and repairs, and the government plans to create a single regulator to ensure higher standards and stronger consumer protection under the Warm Homes Plan.

On 14 October 2025, the National Audit Office published its report on ECO schemes, reviewing DESNZ’s and Ofgem’s management, the scale of non-compliance, corrective actions, and ongoing reforms. It also examined systemic failings and fraud risks, based on audited data, without inspecting homes or assessing overall value for money or emissions reductions. Energy company obligations and other retrofit schemes play a key role in reducing fuel poverty and improving energy efficiency. In its conclusions although it found clear flaws in the design and oversight of ECO4 and GBIS, including weak consumer protections and quality assurance, which led to widespread poor-quality installations and suspected fraud. When DESNZ and Ofgem identified these problems, they acted quickly to address them and to understand the causes. The current system, however, provides limited oversight and tools, so DESNZ now faces the dual challenge of ensuring all affected homes are remediated promptly and reforming the system to prevent such failures in the future.

[edit] Background

On 17 July 2025, the UK Government delivered an update to Parliament revealing serious, systemic issues in the delivery of solid wall insulation (SWI) under the Energy Company Obligation 4 (ECO4) and the Great British Insulation Scheme (GBIS). These government-backed initiatives were designed to improve home energy efficiency by requiring large and medium-sized energy suppliers to fund and install insulation upgrades, typically through contractors. However, an extensive independent audit uncovered widespread poor-quality installations, prompting immediate government intervention to protect affected households and reform the system.

The audit followed reports of defective work and property damage, including damp and mould, which emerged from TrustMark’s routine inspections in late 2024. TrustMark, the independent body overseeing retrofit quality assurance, identified unacceptable levels of poor workmanship in SWI installations and began suspending installers. In response, the Department for Energy Security and Net Zero (DESNZ) commissioned Ofgem to lead an expanded investigation in partnership with TrustMark, certification bodies, and other stakeholders to determine the full scale of the problem.

The findings were alarming. Published in July 2025, the independent audit revealed that 92% of External Wall Insulation (EWI) and 27% of Internal Wall Insulation (IWI) installations examined contained at least one major technical non-compliance. Such failings compromise the effectiveness of insulation systems and, in some cases, pose health or safety risks—identified in 6% of EWI and 3% of IWI cases. While these defects are not typically life-threatening, they undermine the schemes’ objectives of improving energy efficiency and lowering household bills. Installers have been instructed to correct all issues at no cost to homeowners, and any installations posing potential safety risks must be made safe within 24 hours.

[edit] Description

The audit findings exposed deep-rooted failures in the oversight mechanisms established under the previous government. Weak quality controls, fragmented responsibilities, and insufficient accountability allowed poor practices to go unchecked. Contractors operated with minimal scrutiny, while certification and oversight bodies failed to ensure compliance or detect systemic flaws. According to the Government, these shortcomings created a system that was “not fit for purpose,” leaving many homeowners with substandard and even damaging insulation work.

In contrast, other government-funded retrofit programmes—such as the Social Housing Decarbonisation Fund, Home Upgrade Grant, and Local Authority Delivery Schemes—were found to have far fewer issues, owing to their stronger oversight and stricter quality assurance procedures. The Government intends to use lessons from these successful models to strengthen future programmes.

[edit] Response

To address immediate concerns, DESNZ has taken several urgent actions. Thirty-eight installers have been suspended, with reinstatement conditional on the full remediation of all affected properties. Energy suppliers are now required to conduct enhanced checks and maintain greater oversight of their contractors. TrustMark’s operations are under tighter departmental supervision, and new rules have been introduced to prevent installers from avoiding accountability by working across multiple certification bodies. Updated standards will also mandate on-site inspections by retrofit coordinators and raise qualification requirements for retrofit designers to improve assurance and technical quality.

To support affected households, the Government has launched a comprehensive response programme. Every household with external wall insulation installed under ECO4 or GBIS is being offered a free on-site audit, overseen by Ofgem. Householders will not bear any costs for inspections or remedial works, even if their original installer has ceased trading, as all installations are covered by guarantees. Ofgem has set up a dedicated contact centre and online services to assist residents with concerns or questions about their insulation. The Government strongly urges all eligible households to accept audit offers and allow professionals to carry out necessary remediation.

However, ministers emphasise that these actions are only the first step toward systemic reform. The Government is undertaking a comprehensive overhaul of the retrofit oversight and consumer protection framework. The fragmented, privatised system will be replaced with a single, government-led regulatory structure providing clear accountability, consistent standards, and strong enforcement powers. This new system will be central to the forthcoming Warm Homes Plan, which will focus on three key objectives: ensuring installations are “right first time,” simplifying the consumer experience, and guaranteeing swift remediation and redress where problems occur.

Under the reformed model, government—not private entities—will take primary responsibility for ensuring quality and consumer protection across all retrofit activities. The aim is to rebuild public confidence in home energy upgrades and ensure that the pursuit of energy efficiency never compromises safety or quality. The Retrofit System Reform Advisory Panel, alongside the Ministry of Housing, Communities and Local Government and the Building Safety Regulator, will help shape these reforms, with public consultation planned for early 2026.

In closing, the Government reiterated its commitment to helping those affected and ensuring that such widespread failures never happen again. Home energy upgrades remain essential to reducing household bills, cutting emissions, and creating warmer, more efficient homes. However, these goals can only be achieved through strong regulation, professional competence, and consumer trust. By introducing tighter oversight, a unified regulatory system, and enhanced protections, the Government aims to deliver lasting improvements that restore integrity and accountability to the retrofit industry.

[edit] Comments

Gareth Davies, head of the NAO said:

“ECO and other such schemes are important to help reduce fuel poverty and meet the government’s ambitions for energy efficiency. But clear failures in the design and set-up of ECO and in the consumer protection system have led to poor-quality installations, as well as suspected fraud. DESNZ must now ensure that businesses meet their obligations to repair all affected homes as quickly as possible. It must also reform the system so that this cannot happen again.”

National Retrofit Hub statement on ECO4 and GBIS reads:

"The National Retrofit Hub recognises the serious and distressing impact that poor-quality solid wall insulation installations have had on people’s homes and lives. No one should be left dealing with damp, damage, or the stress of navigating complex systems to get their homes put right. (The) statement highlights failings that have left too many households facing the consequences of a system that was meant to support them. These are not isolated incidents, they reveal wider issues in how schemes are designed, overseen, and delivered.

"As government moves to put things right, this must mark a turning point. Quality, accountability, and people’s lived experience need to be at the heart of retrofit delivery. Not as an afterthought, but as the measure of success. Upgrading the nation’s homes through well-designed and properly installed fabric improvements is crucial to improving health, comfort, and resilience, and to reducing fuel poverty. Getting this right is about more than fixing what has gone wrong, it’s about rebuilding confidence and ensuring that every home upgrade delivers the outcomes people deserve.

"We are passionate about ensuring that the impact of these reforms is felt where it matters most - in people’s homes and lives. Lynne Sullivan RIBA OBE, Chair of the National Retrofit Hub Board, sits on the Government’s Retrofit System Reform Advisory Panel, helping to shape the changes needed to deliver high-quality upgrades and build citizen trust in the sector. Brian Berry, NRH Board member and Chief Executive of the Federation of Master Builders, also sits on the panel, ensuring that the voice of small builders and contractors is central to the process. At the National Retrofit Hub, we remain committed to doing all we can to ensure better outcomes for people and neighbourhoods up and down the country."

Responding to the NAO report, Gavin Smart, chief executive of the Chartered Institute of Housing said:

“A safe, comfortable home is the bedrock for good health, wellbeing, and dignity. However, today’s report exposes systemic failures in the delivery of insulation measures that should make homes warmer and healthier, but have instead led to devastating consequences for some residents and communities, through no fault of their own.

"We welcome the action government has taken thus far to identify and remediate affected homes. The experiences of residents and communities must be at the centre of these efforts, but remediation will only be the first step towards restoring trust and repairing the harm that has been caused.

"Alongside this, we also need to see a protracted and immediate emphasis on enhancing oversight, accountability, governance, and quality assurance in the Energy Company Obligation, and whatever follows it, as well as an improved system of consumer protection and redress.

"The government’s Warm Homes Plan will mark the next, necessary step in this process. CIH will continue to work with the government, our members, and partners to ensure that warmer homes are delivered safely, and to the highest standards, both now and in the future.”