Audit Exposes Failures in UK's Home Insulation Scheme, Putting Thousands at Risk

In October 2025, a damning report from the UK's National Audit Office revealed major failures in the country's flagship home insulation program, the Energy Company Obligation (ECO). The audit found that tens of thousands of households have been left with faulty or even dangerous installations under the scheme, which was designed to help households cut emissions and bills.

The report paints a troubling picture, not only because of the human cost, but because it exposes deeper governance issues in the UK's efforts to decarbonize home heating. The ECO, which relies on energy suppliers to fund and oversee insulation and heating upgrades, has been plagued by weak oversight, poor skills, and confused accountability, according to the auditors.

While the ECO worked reasonably well for simple and low-cost measures in the past, its expansion in 2013 to cover more complex and expensive retrofits like solid wall insulation proved to be an approach "set up to fail." Many installations now require major remediation, and some even pose immediate health risks to residents.

Experts say the problems stem from an over-reliance on market-based tools to deliver the kind of foundational change required for the UK to meet its net-zero emissions goals. The country's energy efficiency governance still sits at arm's length from the realities in people's homes, with responsibilities split confusingly between suppliers, government departments, and local authorities.