Heat and Buildings Strategy: Scotland sets out investments to deliver net-zero built environment

More detailed plans are expected following the publication of the UK's Heat and Buildings Strategy

The Scottish Government has published its domestic Heat and Buildings Strategy, featuring overarching commitments to eradicating fuel poverty and setting up a Green Heat Finance Taskforce to finance that transition to zero-emissions heat networks for buildings.

The plan aims to reduce emissions from the nation’s built environment by at least 68% by 2030, which would set the nation up to reach its domestic net-zero target of 2045, which is five years ahead of the wider UK target. This would see a ban on oil and gas boilers introduced by 2030 and in some areas, five years sooner.

However, the Scottish Government believes it cannot fully outline steps to decarbonising its building stock until the UK Government publishes the wider Heat and Buildings Strategy. This policy package initially consisted of two separate Strategies, both originally slated for publication in autumn 2020.

Patrick Harvie, Minister for Zero Carbon Buildings, Active Travel and Tenants’ Right said: “Our homes and workplaces account for around a fifth of Scotland’s total greenhouse gas emissions. We can and must make very significant progress towards eliminating these emissions over the next decade and reduce them to zero by 2045. Transforming our homes and workplaces will be immensely challenging, requiring action from all of us, right across society and the economy.

“This Strategy sets out the significant actions we are taking, but we do not have all the powers necessary to deliver the transformational change required. The delayed UK Heat and Buildings Strategy must set out how the UK will use its regulatory and policy levers to incentivise rapid deployment of zero-emissions heat technologies. We urgently need a stronger commitment and clear action plan on heat from the UK Government. Recent volatility in global natural gas markets further underscores the urgency of UK Government action in reserved policy areas to maintain security of energy supplies and to support consumers.”

The wider UK plan was mooted to be published in August, but there is still no sign of it.

Delays, until recently, had been attributed to the need to combine the Strategies and to the Government’s prioritisation of the Covid-19 response. However, the Strategy was due ahead of the start of Parliament’s summer recess on 22 July and recent delays have been attributed to disagreements within the Conservative Party over the financing of the plans.

Publications including The Times, The Mirror and The Sun reported that the Strategy will not commit the UK to ban gas boilers in homes from 2035, as recommended by the CCC. Instead, a less ambitious deadline of 2040 is reportedly being considered. This is largely to enable the costs of technologies like heat pumps and hydrogen-ready boilers to fall.

ADE’s head of policy Caroline Bragg said: “We strongly support the Scottish government’s ambition on what has been a very collaborative and open consultation process. In particular, we are pleased to see elements such as the ban on sales of gas boilers in on-gas properties by 2030 and to see Scottish Government’s affirmation of their continued support of heat network roll-out. As noted in the strategy, many of the tools that will get us to net zero are not new – they are known.

“We are excited to continue working with our members and with the Scottish Government to rapidly realise this strategy’s ambition, and look forward to the publication of similar plans from the other UK nations.”

Scotland’s plan

Scotland’s strategy will be backed by £1.8bn in Government funding. however, the Scottish Government notes that vestment needing to peak at between £2bn and £2.5bn by the end of this decade.

To this end, a Green Heat Finance Taskforce will be created to unlock private finance that enables the nation to decarbonise its heat networks.

Around two million Scottish homes use mains gas as their primary heating fuel, while just over 260,000 have access to electric heating and 170,000 using high emission fuels including heating oil, LPG or coal.

The Strategy claims that the transition will “require over a million homes and the equivalent of 50,000 non-domestic buildings to convert to zero emissions heat by 2030”. This could bring added benefits, including supporting 16,400 jobs by 2030. The Strategy claims that around 124,000 low-carbon boiler and system alternatives will be needed between 2021 and 2026 and the installation rate will need to peak at over 200,000 new systems per annum in the late-2020s.

A Fuel Poverty Strategy will be issued this year to eradicate fuel poverty in the country. In 2019, 45% of Scotland’s homes were rated EPC C or better and the Government has allocated £200m for heat and energy efficiency projects in social housing over this parliamentary term.

A Regulatory Framework for Zero Emissions Buildings will also be established that will focus on both households and non-domestic buildings.

The Strategy notes that there are approximately 220,000 non-domestic buildings in Scotland that account for 12% of the nation’s final energy consumption and 7% of its greenhouse gas emissions. Currently, around 75% of non-domestic properties have an EPC rating of E or worse, while only 5% are in EPC B or higher.

The Strategy also alludes to a fresh Energy Strategy and an Energy Just Transition Plan, the latter of which will be published early next year.

These strategies will contribute to existing legislative targets for the nation, including delivering a 75% reduction in national emissions by 2030, a 90% reduction by 2040 and requiring that by 2040 no more than 5% of households are fuel poor, no more than 1% are in extreme fuel poverty and the fuel poverty gap is no more than £250.

Commenting on the Strategy, WWF Scotland’s climate and energy policy manager Holly O’Donnell said: “This new strategy to cut emissions from our homes and buildings is an essential step to dealing with the climate emergency.  Soaring gas prices are an urgent reminder that the sooner we can banish polluting and volatile fossil fuels from our homes the better. The new rules mean that all homes will need to reach minimum levels of energy efficiency which will cut carbon, make homes warmer and healthier, while creating thousands of jobs across Scotland and protect against high fossil fuel costs. 

“If the transition to green homes is to be fair to all, then regulations will need to be accompanied by grant support, particularly for those on lower incomes who need it most.  We look forward to seeing more detail on this soon.”

Matt Mace