On the 10th of March the EEA put out a quick survey to the industry regarding the issues around payments and retentions in ECO4. (see https://forms.gle/TDi83WmduC4yAWhu9 )
The survey was open for 7 days and we received 69 responses from across the sector.
The responses were disturbing.
The 69 companies claim they are awaiting payments totalling £45,747,823
41 respondents reported that the energy companies were withholding over 30% of payments that were due to them for completed work.
More disturbing is the response that 11 of these companies were waiting for 100% of the payment due to them.
59 respondents said this was having a significant or severe impact on their business
This impact is clear in the job loss figures. The 69 companies currently employ 1,963 people. But in the last 4 months they have laid off 994 members of staff and 1,317 subcontractors
Octopus Energy is seen as the Energy Company with the most “Extremely High Retentions”, above what the installers might have expected
Most installers willing to accept retentions of 3-5% as reasonable retentions
Along with the amount being retained there is concern about the length of time respondents are waiting for payment of retentions.
60.8% of companies have already been waiting over 60 days beyond when they expected to be paid
There is an inability to plan or budget given that there is no clear indication in many cases when the retentions will be released.
Some only know they are not likely to be paid until the scheme extension period finishes in December 2026,but others have been told it could be up to 6 months beyond that.
72.5% have no idea when funds will be released
When we asked the respondents to describe the impact of this we had a range of responses, but mostly they boil down to “redundancies”, “loss of staff”, “loss of business”, “restricted cashflow”, “issues with creditors” and “struggling with mental health”
What has been the impact of retentions on your business? [please note we have not edited the language in any of these responses so be aware some responses may cause offense]
67 responses
Uncertainty. Loss of staff.
Unable to pay suppliers for materials, as well as staff
Cash flow disturbed, no cashflow to pay to sub contractors and suppliers
Running capital is very tightly squeezed, affecting day to day operations.
Letting people go. Taking loans out
Ovo have always held a retention which allowed us to plan accordingly and factor in, however octopus held no retention untill December when out of the blue with no prior warning held 30 percent retention which has impacted the business massively resulting in job losses
Huge impact on cashflow and staffing
Loss of staff
We are almost closing down
Severe
Had to reduce staff levels, late payments to suppliers
Significant
Has to pay some staff off
Cash flow and business closure
All staff are now being made redundant
We are going into financial difficulties and may have to close down
Redundancies
It has strained the businesses cashflow at a time when industry pressures are also having an affect. Trustmark charging £400 per fail, despite jobs being overturned with evidence available (no remedial works required) is also having an affect. Only the businsses who have stayed afloat and are managing the current transition are being left with this pain as usual.
Cashflow is seriously affected
Severe impact on trading ability and cashflow
Cash flow issue
Very little
High
Multiple people will lose their jobs
Thinking of leaving the sector its caused harm
We have had to take out expensive finance to bridge this is gap and without payments we are laying off staff
Job losses, cashflow pressures
It’s killing my profitability and cash flow. I will need to lay staff off shortly
Mad all of our staff redundant
Clients in our supply chain are making staff redundant and or closing. The investment made in training to build retrofit capacity is being thrown away with little to no regard.
cashflow issues, business closure
Business will be liquidating
Very bad. To the stage of bankruptcy
Severe - loss of jobs - cash flow problmens
Losing on business and mentally anxiety i can't sleep at night day night I'm stressing, even I'm a gas and air source heat pump engineer I've stopped working on ground as well. Which affected all my 25 years hard work plus eco since 2022 I have hard at tge end as a installers company not get paid on time and plus I've mentioned the £600000 I've to pay labour and the materials, my business is going to credit control that will affect my business also, Also my life is in danger because most of the subcontractor chasing me for payment as I don't have nothings to pay all the money is held by Improveasy Ltd, Anesco Limited ,InstaGroup Limited. Since 2 months I can't go out from house as the subcontractor are chasing me so I can be hurt by them, I've switched my mobile because I get threatened and that makes me very stressed at night. I was trying to move Dubai until I get paid but that's been attacked by Iran so no safe place to move for time being. If anythings happened to me Improveasy Ltd and Anesco Limited InstaGroup Limited will be liable and plus the main energy supplier who created this Eco4 system otherwise we won't be touching this insulation, or installing.
Unable to carry out operations especially remedials
Stopping trading
Octopus no reason. BG and OVO linked to utility fails, cb and Trustmark audits, tiny bit of hawthorn
Cash flow is impacted but this will be more of an impact in the coming months without funding.
Staff cuts , potentially closure
Shutting down
Immense mental pressure & struggling to survive
Close to closing down. Owe suppliers money, I’ve had to personally pay salaries from overdrafts and taken out loans.
Reinvestment
My previous business closed down because of it
Much needed cash flow. 40 redundancies
Serious cash flow issue leading to company collapse
We can no longer run our business
With Eco stopping all money is required to help push able to pay.
Likely can't pay our upcoming tax bills.
Cost saving exercises and reduced staff. Unable to do new projects due to non payment.
Can’t hold staff
Due to the sudden nature of the retentions without notice, and their scale and no guarantee there will not be more, the impact has been incredibly significant and damaging, and will remain so until they are paid which currently will not be until June 2027. They are framing it as if it is a low percentage against our entire delivery to them under ECO4 from day one, but that includes multiple contracts which have been delivered, paid and banked by them with Ofgem. To unilaterally make up this old ground they are therefore withholding large percentages (including up to 40%) against current contracts. We have worked hard to maintain high quality and these retentions do not in any way reflect risk they have in our installs, rather they appear to be managing their overall risk against the entire industry, despite our contracts and despite the additional monies we understand has been released to them to close down ECO4.
I’ve had to let my staff go. Mentally it is hard to Take as the retentions are supposed to be held for 6 months but now I’m told I may not receive until December 26 which would be up to 2 years later for some. This would affect anyone, it’s crippled me.
cash flow impact forced us to borrow from the bank, redundancies to save costs
We are super compliant, we have hit all contract KPIs and retention should have been released, however there are now arbritrary holdings against risk, this is cash that was factored into cashflow, myslef and business partner have not taken salary for 4 months so that we can pay the supply chain, it's chaos.
Major cash flow distress
Stopped installing GBIS after first week Jan
Cash flow
Severe cash flow problems resulting in high interest loans needing to be obtained.
Loosing staff because of unpaid and also getting debt collection letters from creditors Fear now having CCJ on our name
Redundancy, reduced hours, unable to pay suppliers
Cash flow is impacted badly not in the position to Trade anymore.
Direct debits payments of our workers and marketing team
I’ve made redundancies, material suppliers , lead gen’s , loans not being paid , and we have never been overdue on a payment , ever
Uncertainty and potential collapse
We have stopped trading and can not proceed until retention is paid. 4 staff laid off
We gave respondents a chance to say anything more about the general state of the energy efficiency sector and the response showed an overwhelming loss of trust in the Government.
While there is clearly resilience in the industry, and a desire to see the Warm Homes Plan work, the respondents are pessimistic about the ability of the Government to deliver the Warm Homes Plan. They do not see the industry surviving long enough to be able to deliver it.
Would you like to say anything else about your business or the state of the energy efficiency sector? [please note we have not edited the language in any of these responses so be aware some responses may cause offense]
57 responses
Thought the government was going to keep things ticking over, name change only I am just getting paid off 7th April total joke ,
I have tried to speak to every council and Tier 1 contractor that has a contract with councils - precisely 0 of them had any work for me in any shape or form.
New plan is focussed on Tier 1 contractors and smaller SME's are suffering and not getting a share. No clear indication on funding or timescale for WHP
For the moment, we do not see anything in the pipeline that would allow us to sustain the business. We currently have no contracts in place and lack the cash flow needed to survive even the next few months, let alone maintain the supply chain operations, cover office rent, and manage other overhead costs.
All the onus and responsibility has been trickled down to installers. There seems to be no repercussions to System Suppliers, Certification Bodies and especially to Trustmark - who failed to do their job for almost 2 and half years since the start of the scheme.
Zenith Eco Solutions has invested heavily in recent years to build the infrastructure, workforce, and operational capacity required to support the UK’s energy efficiency agenda. These investments were made in good faith, aligned with government commitments to improve housing efficiency and reduce carbon emissions. However, the recent budget announcement cutting ECO funding, combined with the absence of a clear successor scheme, has created significant uncertainty across the sector. As a result, much of the investment made by businesses like ours now risks being underutilised, representing a substantial waste of time, money, and resources. Without a clear and consistent long-term policy framework, it becomes extremely difficult for companies to plan, invest, and continue delivering the energy efficiency improvements that the government itself has encouraged.
The industry is struggling now due to no funding being available and previous RFIs and retentions being withheld. Companies are going bust continuously. Those who remain open, are struggling daily with cashflow and have pressures from external creditors who they struggle to pay. Thousands of people have been made redundant across the industry, it’s ridiculous that the industry has been left to rot like this. There is no new scheme available and no vision in sight for any new scheme being made available. The government needs to act very quickly or the majority of the sector will be gone and it won’t be easy to pull skilled people back to the industry
It is very painful
In an industry which should be thriving we cannot believe that it has got to this stage. Many skilled workers and companies will be forced out of the industry due to this. It’s honestly a disgrace
Terrible management of eco 4 overall.the inspection regime should have been 1 agreed on body like atma and that's it..not multiple inspections causing financial hardship on installers and homeowners being inconvenienced sometimes by 4 different parties .Trustmark should not be allowed to charge a find and fix fee..this is a profit making scam. Also with energy companies and La' s only engaging with big tier 1 or managing agents means they pay a significantly reduced rate to installers hence affecting the quality of work..the tier 1 and managing agents are.simply engaged in a paper exercise and taking money from.he installers and the end customers project .the warm.home.s plan will seem to follow this procedure with local.i stalkers being left out of the system and having to work at reduced rates
Industry has been destroyed due to government action
Shambles it’s not just retention we haven’t been paid at all
I’m just extremely disappointed and feel helpless to watch business disappear
We are partnered with a installer, they are being held nearer to £800k, 220k is ours.
The lack of communication of what is happening no funding available and also not knowing when or how the warm homes plan will replace ECO
Our business is graded as a Tier One contractor, so we are well placed to comment on the nature of bringing ECO4 to an end as a whole. As ever, we have a positive plan to move towards with no clear transitional support. Having invested heavily in the business to improve standards and train staff, the good remaining contractors are left shouldering the weight of policy change. As a business also engaged in WH:LG, WH:SHF, EES:ABS, SHNZF etc... it is clear the loss of ECO without a clear and present successor scheme is decimating the industry to the point of potential failure. We are contracted to two utilities to close down their obligation, with funds made available to them through DESNZ nowhere near what is required to do so in a manner which prioritises quality and compliance. I would not be surprised if this approach creates wide spread fraud, non-compliance, OFGEM rejections and creates more bad publicity for the sector. DESNZ and OFGEM need to take a pro active, not passive, approach to winding down the current obligation and ensuring that the WHP is initiated in a way which builds consumer trust.
There will be further redundancies in the next month if retentions are not released. We will seriously consider not participating in a new scheme due to the instability and uncertainty caused by the Government. We feel like we have let customers down that were waiting to have their home upgraded, and with no new scheme in place, the Government are letting the UK population down by not improving homes, it is a step backwards in energy efficiency.
Retentions is unfair
It would be reasonable for the policy makers to work closely with the AMA in order to work on some transition funding. This would retain jobs and provide time for the industry to adapt.
It’s all a mess, let’s be honest
Its pathetic how we have been left
Dont think the business will survive the next 2 months without payment. Too hard to secure any contracts with councils. Companies without any accreditations are winning contracts then asking accredited installers to install. it seems all the hard work to build trusted installers is going to be lost because nobody has any answers as to how the industry is going to shape.
The chancellor has made a strategic decision on fuel poverty to “sell” a saving to the public while using targeted investigations and reports to blame the conservatives for a failed ECO scheme. The reports demonstrated a clear need for independent site inspections, a better framework of funding to allow retrofit to be done right, and a stringent suspension of removal from scheme for failing retrofit organisations. We have seen organisations and individuals, invest considerable time and money to developing the business and skills / qualifications. Not to mention the waste associated should those skills leave the market and the cost of the future needs of managing energy costs, and is abundantly clear at the moment, ENERGY SECURITY! Recover this situation by providing a bridge scheme whether that’s remediation and or helping those in dire need and not currently supported through any of the WHP mechanisms. The combined authorities are struggling to balance the restructures internally and every changing needs of the community. This is a catastrophic systemic failing which needs immediate action. Thank you
lack of clear communication, no alternative routes provided, no clear vision, horrifying affect on the families not businesses only
Stupidity
The lack of transition to new funding streams is appalling and will lead to 000's of job losses and set business back at least 3 years.
Dear Sir, I would like to inform you that I have worked diligently on both the ground works and submissions, delivering high-quality work across several measures including external wall insulation, internal wall insulation, cavity insulation, boiler, source heat pumps, solar PV, and loft RIRI. Despite completing the work to a high standard, I have not yet received payment. This situation is causing significant difficulty for us, especially as retention for the projects is currently being held by Anesco and Improveasy, while the overall projects are held by InstaGroup. As I have fulfilled my responsibilities and delivered quality work, I kindly request that my payment be released as soon as possible. It is important that managing agents do not delay payments to contractors who have completed their work. I would appreciate your prompt attention to this matter and look forward to your response. Many thanks,
we never seen any stability in this sector since it started and cann't see any future
Disgusting behaviour how we have been treat taking money to ransom
Tough times for the industry. We just need to know the plan!
We are all approaching the cliff edge now.
Installers been unfairly treated by Utilities and Management Agents , being used as scapegoats to justify poor ill informed decision’s at Government level
Absolute disaster
This does allow you to create a business model at all
An absolute disaster. I have spent thousands upskilling my team. Invested in my business to offer a whole house retrofit. The money we are offered from managing agents has consistently reduced throughout ECO4. How can you expect quality installs when the money hardly covers the material. We have had to say no to people living in extreme fuel poverty without heating as the money didn’t stack up for that project and the rules behind the scheme. More than a few times through the scheme we have had our work preapproved to move to installs. We installed the work and the funding was cut in half and removed. We have now paid for new heating, insulation and solar panels for a load of properties with no options to recoup our money - tens of thousands of pounds out of pocket never mind the work we have submitted not being paid out. No one is interested in helping us. It is a very dark time for our industry.
We opened a new business but it impacted my last one absolutely
Improveasy hold our retention 15% plus one job 100% payment since last september
Exceptionally disappointed that the government has put businesses like ourselves out of business. As a result all they will achieve is a higher unemployment rate and increased benefit applications. This government is absolutely ridiculous
The business has been built up with hard work and pride in what we do! The way utilities and the government have treated the good companies within the industry is nothing short of disgusting! No real forward thinking with clear dates or plans on a way forward or even how the Eco4 scheme should have ended without putting all the pressure on businesses in that sector.
It's been a disgrace how installers have been thrown under the bus. 9 years building a company, helping 1000s of people. Waste of time investing in apprentices, equipment, training, accreditations, offices. All gone now. Future is bleak.
There is no work out there in any scheme. Eco4 was reduced since April 2024, we have been impacted as solid wall installers significantly seeing 90% reduction in turnover.
Sector is sinking trying to switch to able to pay market but can’t do much as people don’t have funds to spend
Thankfully we had already diversified our business somewhat away from ECO before the sudden budget announcement. If we had not done so these retentions would have forced our company into liquidation. For other companies who have not already diversified sufficiently we do not imagine the suggested transitionary arrangements will save them, whatever those are and whenever they may come which is currently unclear. Even for us, it remains a considerable challenge, and it seems entirely unnecessary given the opposing contractual provisions, the quality of our work and the additional funding we understand they have received to close down ECO4.
I’m in total disbelief how these decisions could possibly be made. They have just taken out over half of the grant funded industry with no clear view or direction on how they plan to deliver the warm homes plan. An extension to the ECO4 scheme was a positive but with no extra funding? How will there be qualified professionals left when the warm homes plan kicks off? The issues will be far greater when it finally starts back due to professionals who really understand retrofit have left the industry to find a more stable income. What will happen is, when the warm homes plan actually starts you will have a surge of demand which will Attract ‘cowboys’ to start up and take advantage. Really bad move from the people in charge. We have customers phoning in with some teething issues but we can’t send anyone to remediate due to there being nobody left in our company. With the retentions that are held we can’t even pay other industry professionals. On a side note, oil prices are going up and we could be still be helping the most venerable. Total failure! Shocking
I can understand the reasons for cancelling ECO4 and replacing with Warm Homes Plan but the fact WHP is unlikely to start until January 2027 and there is zero transition funding will see the industry and supply chain totally collapse. The utility companies are the only ones able to police and manage a scheme the size of WHP but they are not being included moving forward into WHP. Therefore this has had a catastrophic impact since December 2025. The changes are government led so the government need to act now
It's the worst it has ever been, the standard rule book has been ripped up. Energy companies are holding onto to in flight payments in case of risk when businesses collapse, but by holding the payments they are actaully causative of the collapses. I am tracking companies going into liquidation, this is escalating to alrming levels. Merchants are showing no mercy and winding firms up daily, all so predictable and all so avoidable, this government has done irreperable harm to our industry.
Our business is under major distress and have creditors threatening to go legal and is having major impact on my mental health and health I cannot see a way out for installers and most I speak with are weeks away for closure Our cash reserves are running dry
We need clear path of transition from GBIS/ECO to WHP. LA work is all tied up
Tens of thousand of people will have no jobs from April, after years of training.
We have always worked to the rules with no clawbacks in 12 years of working in ECO. If we had work that was going to be clawed back in the future, then an invoice should be raised from the company the work was submitted to. That invoice would get paid by us directly back to them. No money should be retained unnecessarily. These practices don’t encourage businesses to do further work in this sector.
This is the mess created by Trustmark and certifications bodies as it’s clearly they did not done their job in first place even at the time of PAS inspections both were ignoring all fails that they are sending now If they failed these points at that time first inspections every installer could learn and definitely not followed same errors A big question is why roof abutments were passed by certification bodies and trustmark in 2022,2023 and 2024 ? And why same roof abutments are not right now
We have been impacted badly due to retention held by managing agents and due worst decisions by GOVT.
I’ve never known business like it , it’s inhumane
Octopus have actually inspected my allocated jobs but the funder withheld promise of allocation and moneys held back since December
Respondees
We would like to thank the following 69 companies who responded to the survey
Aeg construction ltd
Anesco Energy Ltd
Aspire Energy Solutions Ltd
Assure compliance group limited
Atlas Energy Solutions
C&K Heating & Renewables Ltd
Castle Eco Solutions
Certified Renewable Solutions Ltd
Climate Insulation Limited
Clyde net zero ltd
Complete Remedial Solutions (CRS) Ltd
CT ECO LTD
CT ECO Plus Limited
DHMS Group
Diversity energy solutions
DJB Installs
Eco Efficient Home Solutions Ltd
Eco Gen Contractors Ltd
Eco Providers Ltd
Eco Systems Group
Economic heating solutions uk Ltd
Ecosave installations
Ecosave Installations Ltd
Ecotech Contracts
Effective Eco limited
EEU ltd
E&F Retrofit Services Ltd
Employed Mpc energy ltd
Emerald Green Energy
Energy Pig Limited
Energy Saviour Ltd
Euro Energy Group
G star gas ltd
GOC Solutions Ltd
GRM energy ltd
Green eco standard Ltd
Green Energy and EPC Services
H&R Energy Solutions Ltd
Heat Save Scotland Ltd
Impact Energy Limited
Immerscape Limited
Improveasy
Invictus Energy Group Ltd
Landlord certs london Ltd
LD Eco Ltd
LMF Energy Services
Monza Installs ltd
Nationwide retrofit ltd
Northern Eco installations ltd
NRS ECO LTD
PHS home solution t/a 0800repair
RJM Insulation Limited
Smart Eco Homes LTD
Smart Energie Limited
SSG retrofit ltd
The Green Deal Factory Ltd
Thermatic Homes Ltd
Total Carbon Savings Ltd
Training 4 Retrofit
UK ENERGY SAVING EXPERTS LTD
Union Technical Services Ltd
Warmhouse ltd
Wizard Eco Ltd
Yield climate ltd
Zenith eco solutions