The Energy Company Obligations (ECO) is widely understood to be the “backbone” of the Green Deal. Businesses (and their customers) who already have a relationship with an energy company (via a Green Deal provider) may be able to access ECO (for their clients) directly.
However there have been fears that the companies might hold onto the ECO funding for their in-house operations or a few select contractors, so establishing an ECO brokerage where any Green Deal provider can “sell” energy saving measures to the energy companies, has been seen as a way to widen access to more independent practitioners.
Businesses will still need a relationship with a Green Deal provider to access ECO through brokerage. As currently set up, contracts to deliver carbon and/or running cost savings will have to be ‘bundled’ into lots, and be submitted, with a reserve price, into a fortnightly blind auction to see if any energy companies are buying.
Suppliers of the savings will also need bridging finance: “payment to sellers is within 30 days of the date that ECO-compliant installed measures are reported to the energy company in an Ofgem-compliant format,” DECC state. AECB will be examining these proposals, and asking:
- Does brokerage enable/improve access to ECO for SMEs and their clients? Are changes needed?
- Does brokerage help or hinder businesses that prioritise quality design and installation that delivers real savings, as opposed to chasing notional savings at the lowest price?
More detail of how the scheme is being established, and the questions on which DECC is consulting, can be found at
http://www.decc.gov.uk/assets/decc/11/tackling-climate-change/green-deal/7266-a-guide-to-eco-brokerage.pdf and at http://www.decc.gov.uk/en/content/cms/tackling/green_deal/gd_industry/eco/eco_brokerage/eco_brokerage.aspx
A discussion has been started on the AECB forum here https://www.aecb.net/forum/index.php/board,70.0.html .