Cowboy builders have been accused of forging signatures and lying to homeowners in order to defraud billpayers out of millions of pounds under a scandal-hit government home insulation scheme.
More than £165m worth of public money is believed to have been claimed fraudulently under the now-cancelled scheme, which provided households with grants to make energy efficiency upgrades to their homes, including installing insulation and heat pumps.
It left tens of thousands of householders with defects, including mould and damage to their homes as a result of shoddy workmanship carried out under the £4bn scheme, first launched by the previous Conservative government.
Residents claim companies lied to obtain public money and say they are struggling to get compensation from a complex web of installers, consumer protection firms and middlemen.
Evidence shows that government officials were warned about concerns regarding rogue companies as early as 2023, but were slow to step in.
Sir Geoffrey Clifton-Brown, chair of the Public Accounts Committee, which examines government spending, said: “This was a government scheme, so people who were thinking about participating in it had a right to expect this was a well-organised scheme.”
Instead, ECO4 was “the worst rate of failure” he has seen in his 12 years as chair of the committee, he said.
ECO failure
The Energy Company Obligation (ECO) scheme was introduced by the Conservatives in 2013 to provide households with grants to pay for insulation, heat pumps and solar panels.
The grants are paid directly to installers by energy companies, who raise the money via a tax on energy bills.
EC04 is the fourth iteration of the scheme, providing £4bn worth of grants to householders between 2022 and 2026. Under ECO4, grants would typically range from £7,000 to £20,000 but there was no top limit and some homes received over £60,000.
At the last Budget, Chancellor Rachel Reeves announced ECO would end following mounting evidence of fraud and poor workmanship.
However, the Government has since extended the end date of the scheme from March to December to allow suppliers extra time to meet their targets and remediate previous poor work.
Homeowners, politicians and industry insiders involved with ECO4 say lessons must be learned before the Government launches its replacement, known as the Warm Homes Plan.
Funding free-for-all
The ECO scheme helped to create a rapidly growing green home upgrades industry, with companies fighting for a slice of the billions of pounds worth of public money to retrofit existing housing stock.
These include “lead generation” firms that identify eligible householders by door-knocking or trawling social media and pass their details on to installers for a fee.
Some of these firms are known to operate from as far away as Pakistan or Thailand.
Then there are the installers who receive grant funding from energy companies, as well as the various subcontractors they can employ to carry out the work.
This often happens via an “umbrella agreement”, which means only the lead company obtains the appropriate accreditation and takes responsibility for the work being carried out in people’s homes.
Finally, there’s the complex web of regulators, accreditation bodies and guarantee providers designed to protect consumers if anything goes wrong.
These include TrustMark, a Government-endorsed register on which all companies must be listed to receive ECO4 funding, and Ofgem, the energy regulator, which is responsible for auditing the scheme and ensuring compliance.
Fuel Poverty Action, a charity supporting dozens of residents adversely impacted by ECO4, said the scheme’s failures are a “result of creating a £4bn pound game which allowed anyone, anywhere in the world to take their slice by helping generate the victims and paperwork to unlock the funds”.
Targeting customers
To qualify for grant funding, residents typically have to be receiving benefits, have a low income or have certain health conditions that are exacerbated by cold.
The house itself also has to have a low energy efficiency standard, with higher grant rates given for homes with poorer ratings.
ECO4 lead generation companies would often find eligible households by knocking on doors in low-income areas.
In 2024, Trading Standards Wales issued a warning that “ECO4 cold callers” were knocking on doors in Wrexham pretending to work for the council.
In an email sent to the Department for Energy Security and Net Zero (DESNZ) in 2023, Luton Council said it was receiving multiple calls a day from residents who had been approached by ECO4 installers demanding up to £4,000 after work was finished. Homeowners should not be asked to pay a penny for ECO4 upgrades.
Fuel Poverty Action said it had also seen examples of ECO4 companies using their own doctors to get households approved on medical grounds.
Judith Laird had a heat pump and solar panel fitted in her home last May by Consumer Energy Solutions (CES), a Wales-based company that has since gone into administration.
She told The i Paper she didn’t think she would qualify as she works full time and has savings, but decided to contact CES after her friend had work done by them.
Ms Laird said CES asked her about medical conditions and told her she could qualify as she took medication for high blood pressure.
According to Ofgem, any application should be accompanied by a GP referral. Ms Laird said she provided a photo of her prescription and was told CES’s “online doctor” had approved it.
Faulty forms
The i Paper has spoken to homeowners across the country who are navigating the complex consumer protection system after having shoddy work carried out.
Some do not know the name of the company that applied for funding on their behalf, as this is different from the company they interacted with. They also don’t know which energy company provided the funding.
Many have been left without the official documents needed for them to get help. This includes two landlords who discovered work was carried out on their property without their knowledge.
Some customers have submitted Subject Access Requests to Ofgem, Trust Mark and energy companies to obtain the documents submitted for their property.
Several claim their signatures have been falsified in these forms.
Jane Wallbank had insulation fitted in the home that she lives in with her two children in South Wales last October by CES.
Ms Wallbank’s home was flooded in the middle of her ECO4 retrofitThe experience was a disaster after her home was flooded and she was left without heating for three weeks.
Ms Wallbank claims her signature was fabricated on multiple forms she has obtained under Subject Access Requests, including one dated 31 October 2025, that signed off the work.
The i Paper has seen texts and photographic evidence that show work was still incomplete at Ms Wallbank’s home on this date. While the insulation had been installed, Ms Wallbank still did not have radiators on her wall.
She also noticed that the application forms stated her home had an Energy Performance Certificate (EPC) Rating of E, while the Government’s online registry lists the property as having a higher rating of D.
DESNZ has said it is aware of the “potential for discrepancies” within the Energy Performance Reports conducted by companies.
Despite this evidence, Ms Wallbank has been unable to get compensation.
“I’ve never felt so emotionally, mentally and physically drained in my entire life. I’m constantly just on the verge of tears, having to work out this insane web of organisations and companies,” she said.
“They just point fingers at each other and you go in circles. It’s just never-ending, and I am still here with my children in a house that is destroyed.”
Katie Barrett claims she did not receive any paperwork before ECO4 works commenced in her homeKatie Barrett also claims her signature was fabricated in forms.
She had work carried out in her home in East Sussex by a company called UK Eco Solutions, which is also now in administration, in 2024.
According to Ms Barrett, the company “botched the job” and she has been left with a litany of issues, including faulty insulation, damp and mould.
Ms Barrett said she did not receive any paperwork before the works began and also claims her signature was forged in multiple forms, including one signing off on a retrofit assessment on 12 March.
Ms Barrett said parts of her home have been left ‘unfit for habitation’ after ECO4 worksThese assessments should be made prior to any work being carried out to ensure a property is suitable, but The i Paper has seen evidence that work had already commenced by this date.
Another form appears to show Ms Barrett signing off the project in July, but evidence shows she was already in dispute with the company over the quality of work by this date.
Warning signs ignored
In 2024, more than two years after ECO4 was launched, alarm bells started to sound in the Government about widespread problems within the scheme.
In April, TrustMark notified DESNZ of suspected fraud relating to the falsification of building criteria. In November, TrustMark notified the department of high levels of non-compliant insulation work.
The Government has said this is when they first became aware of problems with the scheme, but evidence suggests that earlier warning signs were ignored.
This includes emails sent from Luton Council to DESNZ in May 2023, where the council warns ECO4 companies are “abusing the ECO4 grant scheme and putting residents into further difficulty and vulnerability”.
In another internal email, a Luton Council official said they had been notified by Leicestershire Police that they were conducting an investigation “on a number of installer companies which could be linked to money laundering”.
The official said they would inform DESNZ of the investigation at an upcoming meeting, “as they won’t take heed of anything I say”.
Scale of fraud unknown
In November 2024, Ofgem used information provided by TrustMark to estimate that installers falsified claims in between 5,600 and 16,500 homes to claim between £56m and £165m.
However, this estimate does not cover all types of fraudulent activity and the National Audit Committee has said Ofgem and DESNZ “do not have data of sufficient quality to accurately estimate the overall level of fraud in ECO”.
In January last year, DESNZ awarded a contract worth £594,000 to an auditor to investigate non-compliance with the scheme, including the misrepresentation of properties, discrepancies with Energy Performance Reports and gaps in household eligibility checks.
Sir Geoffrey said it was “highly unlikely” the official fraud figures were correct, as the Government has “audited a small percentage” of cases. The Public Accounts Committee has said the Government should order the Serious Fraud Office to investigate.
Thousands in limbo
Meanwhile, an unknown number of vulnerable people are stuck living with problems that could cost tens of thousands of pounds to repair.
The Government estimates up to 35,000 homes have been fitted with faulty insulation and vowed these will be fixed at no cost to the homeowner.
However, only 4,600 homes have been fixed by November last year and DESNZ refused to provide a more up-to-date figure.
The Government is relying on the original installers to fix these problems, but many of these contractors have now gone bust and residents also do not want the same companies coming back into their homes.
If the installer has gone bust, the work should be covered by a guarantee worth £20,000, but Sir Geoffrey raised concerns that remediation work will cost more in many cases.
“There’s a real issue here. The Government, during our hearing, said no homeowner should be out of pocket, but I’m sceptical if that will be the case,” he said.
While much of the public attention has focused on insulation failures, The i Paper has spoken to residents who face a wide range of problems, including faulty heat pumps and damage to their properties. Questions remain over what support is available for them.
Liz Saville Roberts, MP for Dwyfor Meirionnydd, has called on the Government to launch an inquiry into the installation of heat pumps and solar under the scheme.
She told The i Paper she knows of constituents living in older homes that have been urged by companies to “take the sort of installations they are most equipped to fit, regardless of whether they are actually the right installations for those houses”.
The majority of fuel poverty and climate campaigners still believe the UK’s housing stock must be retrofitted with heat pumps, insulation and solar to reduce carbon emissions and energy bills.
Labour has tried to distance itself from the scandal by winding down ECO4 and launching its own Warm Homes Programme that it said will learn the lesson from past failures.
Sir Geoffrey said he was “delighted” the Warm Homes Programme was being launched, but said he was doubtful industry would be able to fix the existing problems in people’s homes by December, as promised by the Government.
“I’m really concerned that there will be people out there who’ve got a real serious defect of their home, and the Government hasn’t managed to make sure what was installed wrongly has been put right,” he said.
Those who are dealing with defects in their home fear they will be forgotten as the Government moves onto its new scheme.
“It was sold to everyone as this amazing idea that we were all going to save money, but there were no processes in place for the Government to oversee anything. It was all just money-making for companies,” Ms Wallbank said.
A DESNZ spokesperson said: “Any fraud is clearly completely unacceptable and we are taking urgent action alongside Ofgem to address this.
“With our Warm Homes Plan, we will overhaul the system to protect consumers and ensure failures like these are not repeated.”
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