Seven UK households now describe their homes as ‘uninhabitable’ after an energy firm collapsed while carrying out ECO4-funded upgrades. The company, which traded under several names, left behind botched insulation, exposed wiring, and unauthorised structural changes. As reported by BBC News, the firm’s sudden closure has left homeowners with no warranty, no installer to call, and a repair bill they never budgeted for.
Why this matters for every UK homeowner considering ECO4
The Energy Company Obligation (ECO4) scheme, now in its fourth iteration, is built to help low-income and vulnerable households upgrade their homes at no direct cost. The scheme funds loft insulation, cavity wall insulation, air-source heat pumps, solar PV panels, and more. For a typical 3-bed semi in a low-income band, the grant value can reach £25,000. That is transformative, but only if the work is done right.
The catch is that the installer, not the homeowner, contracts directly with the energy supplier. The homeowner signs a permission form, not a service contract. When the installer goes bust, the energy supplier may argue they have already paid the installer and have no further liability. The homeowner is left holding a cold house and a damp certificate.
What went wrong, and how to spot the warning signs
In the BBC case, residents reported that installers cut structural beams, blocked vents, and left insulation so poorly fitted that mould grew within weeks. One household was told the work was ‘complete’ when the scaffolding was still up and the loft hatch was nailed shut. These are not one-off errors; they are systemic failures of project management and quality control.
Ofgem requires ECO4 installers to be registered with TrustMark or PAS 2030, but registration alone does not guarantee financial stability. A company can hold a valid certification on Monday and be in administration by Friday. Homeowners should ask three questions before any work begins: Is the installer a limited company with at least two years of filed accounts? Do they hold public liability insurance of at least £5 million? And does the energy supplier retain a retention bond, a sum held back until the work is signed off?
What to do if your installer disappears mid-project
If the installer has gone under and the work is incomplete, contact your energy supplier immediately. The supplier has a duty under ECO4 to ensure the work is completed to standard, even if the original contractor has failed. The Energy Saving Trust advises homeowners to keep all correspondence, photographs of the work, and the original survey report.
If the supplier refuses to help, escalate to Ofgem’s ECO compliance team. The regulator can force the supplier to appoint a new installer at no extra cost to the homeowner. In extreme cases, the supplier may be required to pay compensation for any damage caused by the original contractor. But this process can take months, meanwhile, you may be living in a home with no heating or with structural risks.
Protecting yourself before you sign
The simplest safeguard is to choose an installer who is accredited and recommended by your local authority or a trusted neighbour. Check Companies House for any county court judgments against the firm. Ask the energy supplier for the name of the project manager who will oversee the work, and get their direct contact number.
Do not sign a completion certificate until every item on the scope of works is finished and you have seen the final inspection report. If the installer pressures you to sign early, that is a red flag. You have the right to withhold sign-off until you are satisfied. The scheme is meant to help you, not to rush you into accepting substandard work.
Households on standard variable tariffs can check their ECO4 eligibility through gov.uk. Applications are open until March 2027. But before you let anyone into your home, do your homework. One bad installer can turn a government grant into a personal disaster.
Frequently Asked Questions
ECO4 is the UK government's Energy Company Obligation scheme, offering free home upgrades to low-income and vulnerable households. For a typical 3-bed semi-detached house, the grant value can reach up to £25,000, covering loft insulation, cavity wall insulation, air-source heat pumps, and solar PV panels.
If your ECO4 installer collapses, contact your energy supplier immediately, as they have a duty under the scheme to ensure the work is completed to standard. If the supplier refuses, escalate to Ofgem's ECO compliance team, who can force the supplier to appoint a new installer at no extra cost or pay compensation for damage caused.
Ask three key questions: Is the installer a limited company with at least two years of filed accounts? Do they hold public liability insurance of at least £5 million? Does the energy supplier retain a retention bond until the work is signed off? Also, ensure the installer is registered with TrustMark or PAS 2030, but note registration alone doesn't guarantee financial stability.
Warning signs include cutting structural beams, blocking vents, leaving insulation poorly fitted causing mould, and claiming work is complete when scaffolding is still up or loft hatches are nailed shut. These indicate systemic failures in project management and quality control, as seen in recent BBC reports.
Yes, in extreme cases Ofgem can require your energy supplier to pay compensation for any damage caused by the original ECO4 installer. However, the process can take months, so keep all correspondence, photographs of the work, and the original survey report to support your claim.
