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This document sets out the government’s response to its consultation of 12 December 2012 on the ECO brokerage platform. As set out in the government response, the government will not make any changes to the brokerage platform at this stage and will continue to monitor its operation.
In the November 2011 consultation on the Green Deal and Energy Companies Obligation, the government proposed the introduction of a market-based mechanism to support an open and competitive market for the delivery of ECO. There was a clear majority of views expressed in favour of the proposal, so the government intends to put a brokerage mechanism in place on a voluntary basis - while a consultation asking for views, and any supporting evidence, on the need to regulate energy companies to use the brokerage service, is carried out.
The brokerage service will operate as a fortnightly auction, allowing delivery agents to sell ‘lots’ of commitments to deliver units of ECO Obligations, namely the Carbon Saving Obligation, Affordable Warmth and Carbon Saving Communities. ECO-obligated energy suppliers will compete to purchase ECO units. We are seeking views and evidence to supplement our understanding of what volumes of ECO should ideally be traded on the platform, and whether ECO-obligated energy suppliers should be regulated to use it.