Tens of thousands of British homeowners are facing astronomical bills, some exceeding £230,000, to repair defects caused by a failed government energy efficiency programme, Members of Parliament have warned. A damning report from the Public Accounts Committee has labelled the government-backed Energy Company Obligation (ECO) scheme an “abject failure”, with 98% of external wall insulation installations found to be defective and posing immediate health and safety risks.
The committee chair, Sir Geoffrey Clifton-Brown, described the situation as the “most catastrophic fiasco” he has seen during his 12 years on the committee. Despite government assurances that affected homeowners would not have to pay to resolve the issues, the report casts doubt on the ability of the original installers to cover the scale of potential claims, with costs far exceeding the £20,000 cap.
The problems with the ECO scheme were not identified until October 2024, more than two years after it began. By September 2025, only 3,000 of the estimated 30,000 affected homes had been identified and fixed. The Department for Energy Security and Net Zero is now working with regulators to conduct audits and establish the full extent of the crisis.
Fuel Poverty Action spokesperson Jonathan Bean criticised the government’s “vague promises”, calling for a public inquiry into the scandal and a guarantee that all damaged homes will be repaired. The report comes as the government unveils its £15 billion Warm Homes Plan, which aims to provide homeowners with free or low-interest loans for green technologies like solar panels and heat pumps.
However, MPs and campaigners argue that the government must first restore public trust in such schemes by ensuring the effective delivery of the remediation work. Sir Geoffrey warned that the public’s confidence has been “rightly shaken” and the government now has a “self-inflicted job of work” to rebuild faith in the necessary action to reduce bills and emissions.
The Minister for Energy Consumers, Martin McCluckey, acknowledged the “broken system” inherited from the previous government, stating that the current administration is “cleaning up this mess”. He insisted that every household with ECO-installed insulation is being audited, and no homeowner will be asked to pay for the necessary repairs.
With the potential for the Warm Homes Plan to become “an even bigger fiasco”, the government faces a significant challenge in restoring public trust and ensuring the effective delivery of its ambitious energy efficiency initiatives.