The ECT is a 2 wire Coolant Temp sensor, it works similar to the 1 wire dashboard temp gauge "sender" unit, it is a resistance type sensor.
The ECT sensor is common to all fuel injected engines, it is the "choke" setup that was lost when carbs/jets were lost.
A choke on a carburetor worked by limiting the air flow into the top of the carburetor which caused higher vacuum so more fuel was "sucked" from the jets, so engine could run rich which is needed when cold.
Increased vacuum level also advanced distributor timing in these older setups, so two birds with one choke plate
The ECT "tells" the computer the engine is cold so computer opens injectors longer(rich) and computer advances spark timing.
If ECT fails it can fail in two ways.
Hard starting when cold means ECT is telling computer engine is warm all the time.
Excessive fuel use(lower MPG) means ECT is telling the computer engine is cold all the time, so engine is running rich all the time, better performance is often felt with this.
Some have been known to "hijack" the ECT signal and use a variable resistor in the cab to adjust the mixture when they want more performance but less MPG