DESNZ consultation on reforming consumer protection for home upgrade schemes - Which? response

Executive Summary

We welcome the Department of Energy Security and Net Zero (DESNZ) consultation on consumer protection for home energy upgrades. 

An effective consumer protection system is critical for ensuring good outcomes for consumers and supporting the consumer confidence which is needed to support the transition to more affordable, comfortable, low carbon homes. The widespread failings in the ECO and GBIS government schemes highlight the terrible physical, emotional and financial impact when consumer protection doesn’t work effectively. Whilst many installations in the sector are completed to a high standard, there is justified concern about poor quality installations that leave households with damaged properties, failed heating or paying more for their energy bills than they should be. 

There are many elements that we support in the government’s proposals including 

• Improved oversight and enforcement. We welcome the government's plans to increase their oversight of consumer protection for home energy upgrades, including the collection of data and the introduction of contracts with providers and installers. 
• A simpler consumer journey. We welcome the proposal to provide a single front door for all government services, and the case management of complaints and disputes. 
• Register of installers. A single register of installers will be important for households and create a strong incentive for installers to ensure they meet standards. 
• Improved dispute resolution and redress including a single Ombudsman and improved financial protections. Alongside these protections it is important that consumers purchasing home energy upgrades continue to have access to protections available through the Consumer Credit Act. 

In our response we are also calling on the government to ensure the reforms address the following issues: 

Improved protection for all households. We recommend that the government gives all households a Warm Homes Guarantee by creating a single consumer protection system for all home energy upgrades, including self funded upgrades. The system should be aligned with plans for reforming the wider building and home improvements sector. This will give all consumers the confidence to take part in the energy transition, reduce the potential for confusion when households undertake government funded and self funded work, and future proof protections against future changes in government spending. 

More detail needed on how the government will structure the system. The government needs to strike a balance between reducing the fragmentation in the current system and working with existing providers where they are providing a good quality service. It should not attempt to develop its own services where good quality providers are already available, and should concentrate on improving oversight, co-ordination, and reducing duplication. 

A technology neutral approach providing coverage of legacy, current and future home energy systems. The government should consider how it can strengthen protections for digitally enabled energy products so they continue to receive security and software updates for the lifetime of their product. The government should also consider whether some of the same protections and standards should cover households that install gas and oil heating. 

Better enforcement. The government should ensure that where contracts are introduced the contract holder has the capacity to enforce the contract, ultimately through legal action if necessary. The creation of a single installer register is also an important incentive for installers to comply with standards. Unfortunately, a strong consumer protection scheme will not stop some rogue traders so reforms to Trading Standards will be needed to ensure the service can effectively tackle scams and fraud. 

Improved assessments. The quality of assessments is fundamental to improving the quality of installations. We are concerned that assessments are currently overly reliant on paper audits and pre-arranged site visits. We encourage the government to make more use of in situ performance data including setting a minimum efficiency standard for heat pumps, and gather consumer feedback so that the quality of installations is properly understood.

Consumer awareness. Consumer awareness will be critical to the effective functioning of the service, particularly aspects such as the installer register and the case management of disputes. The government should offer all households a Warm Homes Guarantee and have a clear strategy for raising awareness, including working with stakeholders that connect with consumers to ensure they are aware of the protections that are available. 

A clear approach to supporting vulnerable consumers. We welcome recognition of the importance of vulnerability but the consultation lacks clarity as to how vulnerable households are identified and supported.