My Lords, this order was laid before the House on 19 July of this year and I beg to move that it be approved. The Government place great importance on supporting low-income families and ensuring that their energy bills are as low as possible. To that end, we continue to provide direct financial support to vulnerable households through the warm home discount scheme, while the energy price cap will protect around 11 million energy customers who have been stuck on poor value deals. Our election manifesto restated our commitment to tackling fuel poverty by increasing the energy efficiency of homes and the energy company obligation, or ECO, is the key policy in meeting those commitments.
Under ECO, energy suppliers in Great Britain are regulated to reduce domestic energy bills by installing energy efficiency measures. Since its start in 2013, more than 2.4 million measures have been installed in around 1.9 million homes. In 2015, the Government stated their intention to reform ECO to provide more help to those who need it most. The ECO order that we are debating completes that reform and will result in the whole scheme being focused on low-income and vulnerable households until March 2022. We will continue to fund the scheme at £640 million per annum until 2022, and in the Clean Growth Strategy we committed to funding domestic energy efficiency at least at that level until 2028. The Government consulted on proposals for the new scheme in spring and received 239 responses. Most responses were broadly supportive.
Currently, energy suppliers become obliged to act under ECO when they have 250,000 customer accounts. These thresholds were set in 2013, when the “Big Six” energy companies dominated the market. There are now more than 70 domestic suppliers in the market and we consider it appropriate that more are covered. Therefore from April 2019, suppliers with 200,000 customer accounts will be covered, falling to 150,000
from April 2020. We have expanded the eligibility criteria of the scheme so that households on certain disability benefits, their Ministry of Defence equivalents and low-income working households in receipt of child benefit are newly eligible for support. This increases the number of households eligible for support from 4.7 million under the affordable warmth part of the previous scheme to 6.6 million households under the new scheme. We believe this strikes the right balance between supporting those households most in need and keeping delivery costs low. We have also increased the proportion that can be delivered under the local authority flexible eligibility scheme from 10% to 25%. This allows local authorities to refer households for help, including people with health conditions exacerbated by cold homes.
To support the industrial strategy and the clean growth challenge, suppliers will be able to deliver up to 10% of their obligation using measures not previously supported under ECO. While encouraging a broader mix of measures, we will continue to maintain safety and installation standards. The scheme allows the equivalent of 35,000 broken heating systems to be replaced each year so that low-income households can receive support, should their heating system be beyond repair. While other forms of energy efficiency may have greater long-term benefits, a broken boiler can be the immediate crisis point for a struggling family.
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We are allowing oil systems to be replaced so that rural households without a viable alternative can continue to receive support. However, coal heating is ineligible. Only ground source heat pumps will continue to qualify for support under both ECO and the renewable heat incentive. We have limited the potential for double subsidy, but have made an exception for ground source heat pumps due to their high up-front costs and the long-term value of ground loops. Energy suppliers will have to deliver at least 15% of their obligation to rural households, maintaining this important safeguard for households with a greater propensity for fuel poverty.
To encourage installers to take a broader approach to improving the energy efficiency of homes, inefficient heating systems can be replaced if they are delivered alongside high-value insulation. We have retained a solid wall minimum requirement at the equivalent of 17,000 solid wall homes per year, but we have introduced flexibility by allowing suppliers to meet this minimum through a combination of other measures if they deliver the same bill savings as solid wall insulation.
The changes that we have made to the scheme are important. They will help to upgrade the homes and reduce the bills of more than 1 million low-income and vulnerable households during the period of this order, while paving the way for new measures. This will add further impetus to meeting our fuel poverty and carbon reduction goals by encouraging more cost-effective, customer-friendly solutions. I commend the order to the Committee.