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The government鈥檚 fuel poverty adviser has warned the prime minister that cutting the Energy Companies Obligation could land the government in court.

The Energy Companies Obligation (ECO) sits alongside the government鈥檚 flagship Green Deal and provides funding for retrofit work in poorer communities and households, funded by the energy companies.  

The scheme is estimated to be worth 拢1.3bn a year and has so far provided more work to the construction sector than the Green Deal.

However, in recent weeks reports have emerged that the government is considering extending the deadline for energy companies to meet their carbon cutting obligations under the scheme as a way of easing the pressure on consumers鈥� fuel bills.

Extending the deadline for energy firms would effectively slash the amount of carbon they would have to cut through to 2015, which would mean firms would need to spend less money on retrofit work over the period.

The move is understood to be a response to Labour leader Ed Milliband鈥檚 pledge to freeze fuel bills if Labour is elected to government in 2015.

This morning, business secretary Vince Cable said there this was a 鈥渃ontinuing argument鈥� between the Liberal Democrats and Conservatives over the green targets, while the prime minister鈥檚 spokesman did not rule out the possibility of cuts to green targets as part of a 鈥渓ook across the board鈥� at how to ease the cost of living pressure on families.

鈥淚n a context where people鈥檚 budgets are squeezed, people are feeling the pressure, they would expect us to look across the range of what can be done,鈥� he said. 

According to reports in the national press, the chair of the Fuel Poverty Advisory Group (FPAG), the government鈥檚 own advisor, has now written to David Cameron to warn that any such delay to the scheme would leave it open to legal challenge.

The Times reports Derek Lickorish, chair of the FPAG, said: 鈥淥ur anxiety is that the Treasury wants to take a knife to ECO. That would be a derogation of the government鈥檚 obligation to do all it reasonably can to eradicate fuel poverty.鈥�

He added any cut would be open to judicial review.

The debate over the issue has been intensified by a price hike by energy supplier SSE yesterday that will see customers pay an extra 8.2% on average for their energy. Other energy firms are expected to follow suit.

Will Morris, group managing director of retail at SSE, said he was 鈥渟orry we have to do this鈥� but wholesale costs, green levies and transmission costs had forced the firm to raise prices.

He added: 鈥淓ighty five per cent of a typical energy bill is made up of costs outside our direct control and these costs have increased.鈥� He said the firm had made a loss so far this year.鈥�