UK Inquiry Tracker

Faulty energy efficiency installations

Public Accounts Committee Open Inquiry

Opened: 10 Jul 2025 Parliament page

The Energy Company Obligation 4 (ECO4) and the Great British Insulation Scheme (GBIS), both funded via energy consumers’ bills, are government schemes for the installation of energy-efficiency improvements in people’s homes, such as insulation. Not-for-profit quality assurance company TrustMark identified issues with both schemes, with government announcing in January 2025 … Read more The Energy Company Obligation 4 (ECO4) and the Great British Insulation Scheme (GBIS), both funded via energy consumers’ bills, are government schemes for the installation of energy-efficiency improvements in people’s homes, such as insulation. Not-for-profit quality assurance company TrustMark identified issues with both schemes, with government announcing in January 2025 issues including insufficient ventilation, missing or exposed insulation leading to damp and mould. The PAC has found issues on a number of occasions with similar retrofit schemes. Its 2018 report on the Renewable Heat Incentive found that it failed to meet its objectives or provide value for money against a £23bn total cost to taxpayers, while its 2021 report on Green Homes Grants found the scheme’s design was overly complex and that government had persistently failed to learn lessons from previous energy efficiency schemes. In 2025, the National Audit Office publishes its investigation into energy efficiency installations. Proceeding from the NAO investigation’s findings, the PAC will hear from senior officials at the Department for Energy Security and Net Zero the regulator Ofgem, and others, on subjects including what efforts government has taken to remediate problems, how much this will cost the public purse, and the impact on achieving carbon net zero by 2050. If you have evidence on these issues, please submit here by 23:59 on Thursday 30 October 2025. Please look at the requirements for written evidence submissions and note that the Committee cannot accept material as evidence that is published elsewhere. You can request anonymity or confidentiality when you send evidence, but it is the Committee which decides what information to publish and how. It may treat submissions confidentially, even where you have not requested this. Please note that the Committee’s inquiry cannot assist with individual cases. If you need help with an individual problem you are having, you may wish to read the information on Parliament’s website about who you can contact with different issues . The Energy Company Obligation 4 (ECO4) and the Great British Insulation Scheme (GBIS), both funded via energy consumers’ bills, are government schemes for the installation of energy-efficiency improvements in people’s homes, such as insulation. Not-for-profit quality assurance company TrustMark identified issues with both schemes, with government announcing in January 2025 issues including insufficient ventilation, missing or exposed insulation leading to damp and mould. The PAC has found issues on a number of occasions with similar retrofit schemes. Its 2018 report on the Renewable Heat Incentive found that it failed to meet its objectives or provide value for money against a £23bn total cost to taxpayers, while its 2021 report on Green Homes Grants found the scheme’s design was overly complex and that government had persistently failed to learn lessons from previous energy efficiency schemes. In 2025, the National Audit Office publishes its investigation into energy efficiency installations. Proceeding from the NAO investigation’s findings, the PAC will hear from senior officials at the Department for Energy Security and Net Zero the regulator Ofgem, and others, on subjects including what efforts government has taken to remediate problems, how much this will cost the public purse, and the impact on achieving carbon net zero by 2050. If you have evidence on these issues, please submit via the Call for Evidence portal. The deadline for written evidence will be announced in due course. Please look at the requirements for written evidence submissions and note that the Committee cannot accept material as evidence that is published elsewhere. You can request anonymity or confidentiality when you send evidence, but it is the Committee which decides what information to publish and how. It may treat submissions confidentially, even where you have not requested this. Please note that the Committee’s inquiry cannot assist with individual cases. If you need help with an individual problem you are having, you may wish to read the information on Parliament’s website about who you can contact with different issues . Show less

19 Recommendations

20 Conclusions

1 Report

1 Oral session

6 Letters

1 Event

Activity timeline 10 events

21 May
2026

Correspondence

Letter to the Permanent Secretary at the Department for Energy Security and Net Zero relating to Faulty energy efficiency installations, 21…

7 Apr
2026

Report published

Treasury minutes: Government response to the Committee of Public Accounts on the Sixty-second report from Session 2024-26

23 Feb
2026

Correspondence

Letter from the Interim Permanent Secretary at the Department for Energy Security and Net Zero relating to Recommendation 3 of the Committe…

23 Jan
2026

Report published

62nd Report - Faulty energy efficiency installations

12 Jan
2026

Correspondence

Letter from the Chief Executive Officer of the Installation Assurance Authority Federation relating to the Committee’s evidence session on …

8 Dec
2025

Correspondence

Letter from the Chief Executive of the UK Accreditation Service relating to the Committee’s evidence session on Faulty energy efficiency in…

8 Dec
2025

Correspondence

Letter from the Interim Permanent Secretary at the Department for Energy Security and Net Zero relating to the Committee’s evidence session…

1 Dec
2025

Correspondence

Letter from the Chief Operating Officer at TrustMark relating to the Committee’s evidence session on Faulty energy efficiency installations…

13 Nov
2025

Oral evidence

Oral evidence session

13 Nov
2025

Formal meeting (oral evidence session) · The Grimond Room, Portcullis House

Committee event

Oral evidence sessions 1 session

13 Nov 2025

View on parliament.uk

Clive Maxwell CB CBE · Department for Energy Security and Net Zero Deborah Chittenden · Department for Energy Security and Net Zero Jeremy Pocklington CB · Ministry of Defence Jonathan Brearley · Department for Energy Security and Net Zero Jonathan Brearley · Ofgem Kiera Schoenemann · Ofgem Matt Gantley · United Kingdom Accreditation Service (UKAS) Simon Ayers MBE · TrustMark

Reports 1 report · click to expand

Title	HC No.	Published	Items	Response
62nd Report - Faulty energy efficiency installations	HC 1229	23 Jan 2026	39	Responded

Recommendations & Conclusions

10 results

6 Recommendation Rejected

62nd Report - Faulty energy effici…

Ensure one body is responsible for fraud prevention and detection in future schemes.

The Department did not give the risk of fraud appropriate priority, and it is likely that the known levels of fraud are a significant under-statement of the true level of fraud. No single organisation has overall responsibility for preventing and … Read more The Department did not give the risk of fraud appropriate priority, and it is likely that the known levels of fraud are a significant under-statement of the true level of fraud. No single organisation has overall responsibility for preventing and detecting fraud on ECO4 and GBIS. The Department did not carry out a fraud risk assessment during the design of ECO4 and the ownership of some known fraud risks was agreed only in October 2025. Ofgem’s role in relation to fraud is limited to progressing counter-fraud investigations where allegations have been made. Yet no organisation is responsible for pro-actively looking for fraud, nor holds all the data it would require to do so effectively. Ofgem has identified installations worth 1.75% of the scheme value as fraudulent but, given the above, we suspect the true level of fraud to be much higher and above the Departments tolerance threshold of 2%. If the Department had paid more attention to preventing and detecting fraud, it would likely have avoided some of the poor quality installations too. We suggest that the Serious Fraud Office should look at this case. recommendation a. Given the likely role of fraud in the poor quality installations, the Department should refer the issue to the Serious Fraud Office to investigate the extent of fraud across ECO and bring criminals to justice. b. HM Treasury should extend its requirement in Managing Public Money for a Fraud Risk Assessment on all new major areas of public spend to include levy-funded schemes instigated by the government, such as ECO. c. In future schemes, the Department should ensure that one body is responsible for fraud prevention and detection at the system level, enabled by counter-fraud activities of and data from other organisations in the system. d. HM Treasury should amend its guidance in Managing Public Money to recommend public bodies design fraud out of all new schemes as far as is sensible, and have one body responsible for fraud prevention and detecti Show less

Government Response

The government rejected the recommendation to work with the Serious Fraud Office, stating that investigating suspected fraud is already Ofgem's responsibility and referrals have been made. For the other points about fraud risk assessment and prevention, the government agreed that existing standards and guidance already cover these.

HM Treasury

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10 Recommendation Rejected

62nd Report - Faulty energy effici…

Audits reveal widespread performance and safety defects in wall insulation installations

The audits found: • 98% of homes with external wall insulation have major issues: 92% have defects that will negatively affect the insulation’s performance, often creating the risk of water ingress and mould; 6% have immediate health and safety risks, … Read more

Government Response

The government disagrees with the recommendation to supervise and check every new external or internal wall insulation project by an independent, competent, and accountable person, but states that it has greater confidence in local authority delivered retrofit programs and is implementing improvements to the compliance system.

HM Treasury

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11 Recommendation Rejected

62nd Report - Faulty energy effici…

Department accepts unacceptable spectrum of failures in insulation causing health risks

The Department stressed to us that these failures include a spectrum of issues, from not getting the full benefit of a measure because of gaps in the insulation, through to more serious failings that have caused damp or mould or … Read more

Government Response

HM Treasury

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12 Recommendation Rejected

62nd Report - Faulty energy effici…

Faulty installations cause severe physical, emotional, and financial distress for households

Faulty installations can have wider impacts on households, beyond just living in unsafe, damp or mouldy homes. Respondents to Ofgem’s survey of people who used its ECO helpline reported being left without central heating over winter and having to seek … Read more

Government Response

HM Treasury

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14 Recommendation Rejected

62nd Report - Faulty energy effici…

Less than 10% of homes with major insulation issues remediated after one year

The National Audit Office reported that, as of 11 September 2025, 2,934 homes with external and internal wall insulation with major issues had been remediated.25 This means less than 10% of the estimated 32,000 to 35,000 homes with major issues … Read more

Government Response

HM Treasury

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19 Recommendation Rejected

62nd Report - Faulty energy effici…

TrustMark lacks direct collaboration with Companies House to prevent directors avoiding remediation responsibilities.

The National Audit Office also reported that some company directors are closing and restarting their businesses to avoid remediation responsibilities.40 TrustMark told us it has developed a watchlist and can stop a new business operating until it has fixed the … Read more

Government Response

The government disagrees with the recommendation to only allow new external or internal wall insulation to be installed through retrofit schemes if supervised and checked by someone who is independent, competent and accountable, as they have greater confidence in the quality of installation and compliance in local authority delivered retrofit programmes.

HM Treasury

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33 Recommendation Rejected

62nd Report - Faulty energy effici…

Department failed to complete a full fraud risk assessment before ECO4 implementation.

The Department did not complete a full fraud risk assessment before ECO4 was implemented in 2022. This became a mandatory requirement in Managing Public Money for any new major area of spend in March 2022, but it would still have … Read more

Government Response

The government disagrees with referring the issue to the Serious Fraud Office, stating that Ofgem has the responsibility for exploring cases of suspected fraud and can make referrals where appropriate.

HM Treasury

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34 Recommendation Rejected

62nd Report - Faulty energy effici…

No single organisation holds overall responsibility for preventing fraud in ECO4 and GBIS.

The Department explained that no single organisation has overall responsibility for preventing and detecting fraud on ECO4 and GBIS.79 Ofgem’s role in relation to fraud is limited to progressing counter-fraud investigations where allegations have been made.80 Ofgem explained to us … Read more

Government Response

The government disagrees with referring the issue of fraud to the Serious Fraud Office, stating Ofgem already has the responsibility to explore suspected fraud and make referrals where appropriate. The department will prioritise deterrence and prevention, before harm is done.

HM Treasury

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35 Recommendation Rejected

62nd Report - Faulty energy effici…

Organisations lack requirement to proactively seek fraud, hindered by poor information sharing.

Ofgem relies on energy suppliers, TrustMark, certification bodies and scheme providers to alert it to any suspicions of fraud. However, while these bodies have responsibilities to report fraud that they have identified, they 76 Qq 20, 28, 56; Letter from … Read more

Government Response

HM Treasury

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36 Recommendation Rejected

62nd Report - Faulty energy effici…

Fraud likely contributes to high defect levels; Department enhancing fraud detection efforts.

We pushed Ofgem and the Department on what they were doing to actively look for fraud, and highlighted that fraud is likely contributing to the high level of defects on external and internal wall insulation.85 Written evidence submitted by members … Read more

Government Response

The government disagrees with referring the issue of fraud to the Serious Fraud Office, stating that Ofgem already has the responsibility to explore suspected fraud cases and make referrals to relevant bodies.

HM Treasury

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Government Response AI assessment · 37 of 19 classified

Accepted 9

Accepted in Part 2

Acknowledged 1

Deferred 3

Not Addressed 12

Rejected 10

Total 19 recs + 20 conclusions

Correspondence 6 letters

21 May 2026 From committee Letter to the Permanent Secretary at the Department for Energy Security and Net Zero relating to Faulty energy efficiency installations, 21 May 2026

Parliament page

23 Feb 2026 To committee Letter from the Interim Permanent Secretary at the Department for Energy Security and Net Zero relating to Recommendation 3 of the Committee’s Report on Faulty energy efficiency installations, 06 February 2026

Parliament page

12 Jan 2026 To committee Letter from the Chief Executive Officer of the Installation Assurance Authority Federation relating to the Committee’s evidence session on 13 November 2025 on Faulty energy efficiency installations, 23 December 2025

Parliament page

8 Dec 2025 To committee Letter from the Chief Executive of the UK Accreditation Service relating to the Committee’s evidence session on Faulty energy efficiency installations on 13 November 2025, 27 November 2025

Parliament page

8 Dec 2025 To committee Letter from the Interim Permanent Secretary at the Department for Energy Security and Net Zero relating to the Committee’s evidence session on Faulty energy efficiency installations on 13 November 2025, 02 December 2025

Parliament page

1 Dec 2025 To committee Letter from the Chief Operating Officer at TrustMark relating to the Committee’s evidence session on Faulty energy efficiency installations on 13 November 2025, 25 November 2025

Parliament page