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Publication - Report

Draft climate change plan: draft third report on policies and proposals 2017-2032

Published: 19 Jan 2017
Part of:
Environment and climate change
ISBN:
9781786527431

Draft of the climate change plan, the third report on proposals and policies (RPP3) for meeting Scotland’s annual greenhouse gas emissions targets.

175 page PDF

1.9MB

175 page PDF

1.9MB

Contents
Draft climate change plan: draft third report on policies and proposals 2017-2032
10. Services

175 page PDF

1.9MB

10. Services

Services covers all non-domestic buildings in the public and commercial sectors.

10.1 Where we are now

10.1.1 Total service sector emissions in 2014 were 3.4 MtCO 2e. Emissions have remained relatively steady between 1990 and 2014, although they have varied annually, driven by fluctuating external temperatures. Since the Climate Change (Scotland) Act 2009 was passed emissions have fallen by 7%.

10.1.2 Historical data on the profile of non-domestic building stock for the services sector, and its energy use, have been limited. Whilst research preceding introduction of the Assessment of Energy Performance of Non-domestic Buildings Regulations 2016 did suggest a total size of the non-domestic building stock, based upon a relatively large amount of interpolation, it did not then look at statistical reporting on performance as this was not required to inform regulation.

10.1.3 Data are now available for those non-domestic buildings which have had an EPC assessment, as required by the EU Energy Performance of Buildings Directive 2004, for the period since data were first recorded in 2013. But as yet, given levels of market turnover since 2013, the dataset that is available does not constitute a complete data set on energy performance of non-domestic buildings. The Scottish Government is currently undertaking further analysis to establish a baseline for non-domestic buildings' energy and emissions data, against which progress under the Climate Change Plan can be measured, and in doing so, is drawing upon UK-wide data sets and building-specific meter-point data.

Figure 15: Services historical emissions

Figure 15: Services historical emissions

10.2 Our ambition

Figure 16: Services carbon envelopes

Figure 16: Services carbon envelopes

10.2.1 By 2032, through Scotland's Energy Efficiency Programme ( SEEP), we will have transformed the energy efficiency and heating of our non-domestic buildings in the services sector so that, wherever technically feasible, and practical, buildings are near zero carbon. This will make our shops, offices, schools and hospitals warmer and easier to heat, and by reducing energy demand, we can help businesses improve their energy productivity and competitiveness and release savings in the public sector for front line services.

10.2.2 By 2032 the majority of commercial and public buildings will be connected to low carbon heating systems, rather than using natural gas. The sustained effort over the period to 2032 will help to shift public attitudes, and energy efficiency and a low carbon heat supply are now considered desirable attributes for business competitiveness and public sector efficiency. The high energy efficiency of the building stock will help to, in part, minimise the impact of any future fuel price rises on bills.

10.2.3 Over their lifetime our programmes and policies will have supported thousands of jobs across Scotland and create a substantial Scottish market and supply chain for energy efficiency and renewable heat services and technologies. Furthermore, they will have helped businesses and the public sector to save millions of pounds in fuel bills, money which could be recycled into local economies and help to regenerate communities - by improving the appearance of the built environment as well as contributing to improving employee health and well-being outcomes.

To help guide us towards meeting our climate change targets we set the following milestones out to 2050:

By 2032, 94% of non-domestic buildings' heat and cooling [53] is supplied using low carbon heat technologies [54] .

By 2050, all non-domestic buildings across Scotland will be near zero carbon.

10.3 Policy outcomes, policies, development milestones and proposals [55]

Policy outcome 1: Improvements to the fabric of Scotland's non-domestic buildings results in a 10% reduction in their heat demand by 2032 [55] .

There are three policies, five policy development milestones, and two proposals which will contribute to the delivery of policy outcome 1.

Policies which contribute to the delivery of policy outcome 1

1) Low Carbon Infrastructure Transition Programme supports investment in decarbonisation of business and the public sector through £76 million funding to 2018.

2) Public Sector Energy Efficiency Procurement Framework/Project Support Unit. Enables potentially £300m worth of investment across public sector estate.

3) Non-domestic energy efficiency finance (Salix Loans (public sector), SME Loans (business), District Heating Loan Fund) continues as part of development of SEEP.

Policy development milestones which contribute to the delivery of policy outcome 1

10.3.1 Energy Efficiency was designated as a national infrastructure priority in June 2015. In that context, the Programme for Government commits the Scottish Government to significant policy development on heat and energy efficiency improvements in buildings across Scotland. Scotland's Energy Efficiency Programme ( SEEP) is a long term programme to improve the energy efficiency and reduce the environmental impact of Scotland's domestic and non-domestic buildings. It will build on our existing successful delivery programmes and include the development of a package of policies, across the following themes, that will contribute to the delivery of the policy outcome:

1) Regulation and Standards

2) Financial Incentives

3) Advice and Information

4) Delivery Programmes

5) Evidence and Evaluation

10.3.2 In the Programme for Government, Scottish Ministers committed to £500 million for SEEP over the first four years of the programme. The Scottish Government will undertake initial consultation on the design of delivery programmes within SEEP in January 2017, alongside consultation on the Energy Strategy, and will publish a SEEP Routemap in 2018.

Proposals which contribute to the delivery of policy outcome 1

1) Regulation - review of The Assessment of Energy Performance of Non-domestic Buildings (Scotland) Regulations 2016.

2) Regulation - Review of energy standards within buildings regulations. [5657]

Policy outcome 2: By 2032 94% of non-domestic buildings' heat [56] is supplied using low carbon heat technologies [57]

There are four policies, five policy development milestones, and one proposal which will contribute to the delivery of policy outcome 2.

Policies which contribute to the delivery of policy outcome 2

1) District Heating Loan Fund and Heat Network Partnership.

2) Non-domestic Renewable Heat Incentive (ends 2020/21) and associated SG supportive programmes.

3) Low Carbon Infrastructure Transition Programme supports investment in decarbonisation of business and the public sector through £76 million funding to 2018.

4) All small and medium sized non-domestic premises to be offered a smart meter by 2020.

Policy development milestones which contribute to the delivery of policy outcome 2

10.3.3 Energy Efficiency was designated as a national infrastructure priority in June 2015. In that context, the Programme for Government commits the Scottish Government to significant policy development on heat and energy efficiency improvements in buildings across Scotland. Scotland's Energy Efficiency Programme ( SEEP) is a long-term programme to improve the energy efficiency and reduce the environmental impact of Scotland's domestic and non-domestic buildings. It will build on our existing successful delivery programmes and include the development of a package of policies, across the following themes, that will contribute to the delivery of the policy outcome:

1) Regulation and Standards

2) Financial Incentives

3) Advice and Information

4) Delivery Programmes

5) Evidence and Evaluation

10.3.4 In the Programme for Government, Scottish Ministers committed to £500 million for SEEP over the first four years of the programme. The Scottish Government will undertake initial consultation on the design of delivery programmes within SEEP in January 2017, alongside consultation on the Energy Strategy. As part of this consultation, we will consult specifically on regulation of district heating. The Scottish Government will publish a SEEP Routemap in 2018 alongside the launch of the programme.

Proposal which contributes to the delivery of policy outcome 2

1) Develop and identify the best approach to the long-term decarbonisation of the heat supply, to commence after 2025. We intend to include a proposal on how we may realise this potential, in a future Climate Change Plan, taking into account decisions that the UK Government will take on the future of the gas network and the outcomes of the consultation on the draft Energy Strategy.

10.3.5 Full details of policies, policy development milestones and proposals are set out in the tables below. The delivery of these will be tracked through the monitoring framework (see section 6).

10.4 Wider impacts

10.4.1 The following co-benefits and wider impacts have been identified for the Services sector:

Co-benefits to be realised

10.4.2 Support through SEEP for investment to improve the energy efficiency of non-domestic buildings has the potential to deliver improved energy productivity and therefore enhanced competitiveness for business and the third sector, if costs are lower. Warmer and more comfortable workplaces could ensure better employee health and well-being. Investment in building fabric improvements for commercial and public buildings can support wider regeneration and better place outcomes.

10.4.3 These policy outcomes will affect all users of public and commercial buildings, whether as employees, or those accessing services. Impacts through improvements to non-domestic buildings could be more noticeable for those in areas of poverty which would benefit from regeneration, and this would apply equally in urban and rural areas given the intended nationwide coverage of SEEP.

10.4.4 SEEP's delivery programmes will be designed to emphasise cost-effective energy efficiency and heat decarbonisation measures that reduce energy bills and enhance competitiveness.

10.4.5 SEEP will help to support jobs and businesses within the local and national economy. Scottish Government analysis suggests that for every £100 million spent on energy efficiency measures, approximately 1,000 full-time equivalent jobs are supported across the Scottish economy. SEEP will help to realise economies of scale helping to drive down the cost of energy efficiency measures. There will be opportunities for SMEs and third sector organisations to deliver and/or support the delivery of energy efficiency measures.

Adverse side effects to be managed

10.4.6 If the capital costs of improving the energy performance of non-domestic buildings and of installing low carbon heat technologies, and the operating costs of running them, are higher than current systems, the public and commercial sectors could find energy bills are less affordable, which could have adverse effects on business competitiveness.

10.4.7 The Scottish Government will work with business and the public sector to ensure that SEEP's delivery programmes will be designed to emphasise cost-effective energy efficiency and heat decarbonisation measures that reduce energy bills and enhance competitiveness. We will work with business and the public sector on how to ensure that SEEP supports these cost-effective measures, including on evidence and evaluation where needed.

10.5 Summary of policies, development milestones and proposals

Policy outcome 1: Improvements to the fabric of Scotland's non-domestic buildings results in a 10% reduction in their heat demand by 2032 [58]

Table 10-1: Policies that contribute to the delivery of policy outcome 1

Policy

EU, UK or Scottish policy

Public sector partners

Delivery route

Low Carbon Infrastructure Transition Programme supports investment in decarbonisation of business and the public sector through £76 million funding to 2018

Scottish

Scottish Government

Scottish Enterprise

Highlands and Islands Enterprise

Scottish Futures Trust

Resource Efficient Scotland

A range of support mechanisms including project development, expert advice and funding (where applicable) is available through the Low Carbon Infrastructure Transition Programme ( LCITP) to support the development of substantive private, public and community low-carbon projects across Scotland. The intervention will focus on supporting the acceleration of projects to develop investment grade business cases allowing them to secure existing streams of public and private capital finance.

In addition, the programme will collate evidence on recurring barriers and challenges to projects and share this intelligence with investment communities to ensure the refinement of all parts of the system to support the transition to a low carbon economy where possible. It is expected that information about supported projects will be shared as required on a confidential basis between the partners without affecting applicants' commercial sensitivity. This work will continue as part of the development of SEEP, supporting non-domestic energy efficiency and heat projects for decarbonisation.

Public Sector Energy Efficiency Procurement Framework/Project Support Unit. Potentially £300 million worth of investment across public sector estate

The Scottish Government has put in place a non-domestic energy efficiency ( NDEE) procurement framework for the Scottish public sector, launched on 1 March 2016, that supports energy performance contracting, sharing the delivery risk to the private sector, whilst the public sector secure carbon and financial benefits NDEE projects will retrofit buildings with a range of energy efficient measures, creating savings in energy and maintenance costs, reducing carbon emissions and improving the environmental comfort of buildings, and this work will continue as part of the development of SEEP.

Non-domestic energy efficiency finance (Salix Loans (public sector), SME Loans (business), District Heating Loan Fund) continues as part of development of SEEP

Scottish

UK

Scottish Government

Salix Finance

Resource Efficient Scotland

Energy Saving Trust

The Scottish Government's non-domestic energy efficiency finance will continue as part of the development of SEEP, building on existing funding frameworks which already support business and the public sector with low cost loan finance. SEEP will develop financial incentives to enable business and the public sector to meet the objectives for improvement in energy efficiency of non-domestic buildings - these will support compliance with any regulations for improved building performance introduced as part of SEEP.

Provide £9m funding to support SEEP Pilots in 2016/17 and make available further funding to support pilots in 17/18 to test innovative delivery mechanisms for energy efficiency and low carbon heat

Scottish

Local Authorities

Pilot projects funded to test innovative approaches to integrated, area-based energy efficiency and heat decarbonisation programmes across domestic and non-domestic sectors from 2016-20. Will be evaluated and contribute evidence to design of Programme for SEEP.

Table 10-2: Policy development milestones that contribute to the delivery of policy outcome 1

Policy development milestone

Delivery route

SEEP - Regulation and Standards

The Programme for Government commits the Scottish Government to consult on regulation and standards for energy efficiency and for heat. This includes a commitment to consult on the phased regulation of existing buildings, and to look at financial incentives. The Scottish Government will undertake initial consultation on the wider role of regulation and standards within SEEP in early 2017, alongside consultation on the Energy Strategy, and this will then inform future programme development. As part of this consultation, we will consult specifically on regulation of district heating.

SEEP - Financial Incentives

The Programme for Government delivers the Infrastructure Investment Plan 2015 commitment to long-term multi-year financing for SEEP, and includes a commitment to £500 million for SEEP over the first four years of the programme. Availability of loan finance, grants and appropriate incentives introduced at the right times will be necessary to stimulate the market for investment or to help building owners and tenants to meet energy efficiency or heat standards set by regulation. The Scottish Government will undertake initial consultation on the role of financial incentives within SEEP in January 2017, alongside consultation on the Energy Strategy, and this will then inform future programme development.

SEEP - Advice and Information

Our existing advice and support services for residential (Home Energy Scotland), business and public sectors (Resource Efficient Scotland) will continue to deliver during the design phase of SEEP. As SEEP develops over the longer term, we will consider the future provision of advice and information to homes, businesses, and the public sector, to support them in improving the energy efficiency and decarbonising the heat supply of their buildings. The Scottish Government will undertake initial consultation on the role of advice and information within SEEP in January 2017, alongside consultation on the Energy Strategy, and this will then inform future programme development.

SEEP - Delivery Programmes

SEEP will build on our existing successful delivery programmes for domestic and non-domestic buildings by developing new, integrated programmes to offer advice, information, financial incentives, and access to managed, trusted installers, to building owners and tenants. The eventual delivery programmes will build on the evidence and lessons learned from existing programmes and from pilot projects, such as the £9.1m announced in September 2016. The Scottish Government will undertake initial consultation on the design of delivery programmes within SEEP in January 2017, alongside consultation on the Energy Strategy, and this will then inform future programme development.

SEEP - Evidence and Evaluation

The Scottish Government is currently undertaking further analysis to establish a baseline for non-domestic buildings' energy and emissions data against which progress under the Climate Change Plan can be measured, drawing also on UK-wide data sets and building-specific meter-point data.

SEEP - Route Map

The Scottish Government will publish a SEEP Route Map in 2018 setting out the steps we will take to deliver our commitments on energy efficiency and low carbon heat.

Table 10-3: Proposals which contribute to the delivery of policy outcome 1

Proposal

Delivery route

Regulation - Review of the Assessment of Energy Performance of Non-domestic Buildings (Regulations) 2016

Regulations introduced in September 2016 require assessment and improvement in the energy performance and emissions of larger non-domestic buildings (those over 1,000 m²). Initially, an option to defer improvement where reporting on annual operational energy use is available to building owners. Improvement delivered under these regulations will be monitored, to inform early review of both the scope and level of improvement sought from existing buildings, with an intent to review from 2018 leading to amended regulations in 2020.

Regulation - Review of energy standards within building regulations

Staged improvements to energy standards within building regulations have resulted in emissions from buildings built to current standards being, on aggregate, around 75% lower than those of buildings built to standards in force in 1990. A further review of energy standards will commence in 2017 and will investigate a number of topics that offer the potential for further abatement from new buildings and where work is undertaken in existing buildings.

Table 10-4: Policy outcome 1 over time [59]

Policy outcome 1

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

2031

2032

Improvements to the fabric of Scotland's non-domestic buildings results in a 10% reduction in their heat demand by 2032 [59]

4%

6%

10%

Policy outcome 2: By 2032 94% of non-domestic buildings' heat [60] is supplied using low carbon heat technologies [61]

Table 10-5: Policies which contribute to the delivery of policy outcome 2

Policy

EU, UK or Scottish policy

Public sector partners

Delivery route

District Heating Loan Fund and Heat Network Partnership

Scottish

Scottish Government

Scottish Enterprise

Scottish Futures Trust

Resource Efficient Scotland

Local Authorities

Energy Saving Trust Scotland

The District Heating Loan Fund helps address the financial and technical barriers to district heating projects by offering low interest loans. The scheme is open to local authorities, registered social landlords, small and medium sized enterprises and energy services companies with less than 250 employees. During the development of SEEP, we will consider what sort of funding mechanisms are needed to continue to support the expansion of district heating networks.

The Heat Network Partnership is a collaboration of agencies focused on the promotion and support of district heating schemes in Scotland. Through its support to local authorities and practitioners, it is building capacity and project development capability to support heat planning and programme delivery work that will be developed by local authorities, the Scottish Government and its partners, as part of the wider SEEP programme in future.

Non-domestic Renewable Heat Incentive (ends 2020/21) and associated SG supportive programmes

UK

UK Government

The Renewable Heat Incentive is a UK-wide scheme created by the UK Government (with the agreement of the Scottish Government). The non-domestic scheme helps businesses, public sector and non-profit organisations meet the cost of installing renewable heat technologies such as biomass, heat pumps (ground source, water source and air source), deep geothermal, solar thermal collectors, biomethane and biogas, combined heat and power ( CHP) systems. Payments are made over 20 years and are based on the heat output of the system. There is no commitment to funding the RHI beyond 2020/21 and during the development of SEEP we will consider what sort of funding mechanisms are needed into the 2020s and 2030s to enable continued take-up of these technologies.

Low Carbon Infrastructure Transition Programme supports investment in decarbonisation of business and the public sector through £76 million funding to 2018

Scottish

Scottish Government

Scottish Enterprise

Highlands and Islands Enterprise

Scottish Futures Trust

Resource Efficient Scotland

A range of support mechanisms including project development, expert advice and funding (where applicable) is available through the Low Carbon Infrastructure Transition Programme ( LCITP) to support the development of substantive private, public and community low-carbon projects across Scotland. The intervention will focus on supporting the acceleration of projects to develop investment grade business cases allowing them to secure existing streams of public and private capital finance.

In addition, the programme will collate evidence on recurring barriers and challenges to projects and share this intelligence with investment communities to ensure the refinement of all parts of the system to support the transition to a low carbon economy where possible. It is expected that information about supported projects will be shared as required on a confidential basis between the partners without affecting applicants' commercial sensitivity. This work will continue as part of the development of SEEP, supporting non-domestic energy efficiency and heat projects for decarbonisation.

All small and medium sized non-domestic premises to be offered a smart meter by 2020

UK

UK Government

The UK Government is committed to ensuring that every home and business in the country is offered a smart meter by 2020, and to delivering this as cost effectively as possible. Smart meters provide the opportunity for a greater understanding of final energy consumption; an accurate metering and billing system which eradicates estimated bills; the potential for positive behavioural change and a reduction in energy costs; as well as creating opportunities for innovation.

Smart meters will be offered to all homes and smaller and medium sized non-domestic premises. In the wider non-domestic market, energy suppliers are already required to ensure that energy supplied to larger electricity sites (defined as those within profile classes 5-8) and larger gas sites (defined as those with consumption above 732MWh per annum) is measured by an advanced meter. The smart meter rollout focuses on the remaining, smaller sites - those in electricity profile classes 3 and 4, and those with gas consumption below 732MWh per annum.

The smart meter rollout is a supplier-led obligation.

Table 10-6: Policy development milestones which contribute to the delivery of policy outcome 2

Policy development milestone

Delivery route

SEEP - Regulation and Standards

The Programme for Government commits the Scottish Government to consult on regulation and standards for energy efficiency and for heat. This includes a commitment to consult on the phased regulation of existing buildings, and to look at financial incentives. The Scottish Government will undertake initial consultation on the wider role of regulation and standards within SEEP in January 2017, alongside consultation on the Energy Strategy, and this will then inform future programme development. As part of this consultation, we will consult specifically on regulation of district heating.

SEEP - Financial Incentives

The Programme for Government delivers the Infrastructure Investment Plan 2015 commitment to long-term multi-year financing for SEEP, and includes a commitment to £500 million for SEEP over the first four years of the programme. Availability of loan finance, grants and appropriate incentives introduced at the right times will be necessary to stimulate the market for investment or to help building owners and tenants to meet energy efficiency or heat standards set by regulation. The Scottish Government will undertake initial consultation on the role of financial incentives within SEEP in January 2017, alongside consultation on the Energy Strategy, and this will then inform future programme development.

Through this programme we will also consider impacts of UK Government's GB subsidy regime beyond the potential end of the RHI in 2020/21, particularly on off gas grid businesses; including how any changes can be mitigated to maintain uptake of low carbon heat technologies.

SEEP - Advice and Information

Our existing advice and support services for residential (Home Energy Scotland), business and public sectors (Resource Efficient Scotland) will continue to deliver during the design phase of SEEP. As SEEP develops over the longer term, we will consider the future provision of advice and information to homes, businesses, and the public sector, to support them in improving the energy efficiency and decarbonising the heat supply of their buildings. The Scottish Government will undertake initial consultation on the role of advice and information within SEEP in January 2017, alongside consultation on the Energy Strategy, and this will then inform future programme development.

SEEP - Delivery Programmes

SEEP will build on our existing successful delivery programmes for domestic and non-domestic buildings by developing new, integrated programmes to offer advice, information, financial incentives, and access to managed, trusted installers, to building owners and tenants. The eventual delivery programmes will build on the evidence and lessons learned from existing programmes and from pilot projects, such as the £9.1m announced in September 2016. The Scottish Government will undertake initial consultation on the design of delivery programmes within SEEP in January 2017, alongside consultation on the Energy Strategy, and this will then inform future programme development.

SEEP - Evidence and Evaluation

The Scottish Government is currently undertaking further analysis to establish a baseline for non-domestic buildings' energy and emissions data against which progress under the Climate Change Plan can be measured, drawing also on UK-wide data sets and building-specific meter-point data.

SEEP - Route Map

The Scottish Government will publish a SEEP Route Map in 2018 setting out the steps we will take to deliver our commitments on energy efficiency and low carbon heat.

Table 10-7: Propsals which contribute to the delivery of policy outcome 2

Proposal

Delivery route

Develop and identify best approach to the long term decarbonisation of the heat supply, to commence after 2025.

We will work with our partners, including UK Government, Local Authorities and utility providers to determine the best approach to heat decarbonisation for buildings currently heated by natural gas, which are not in areas of sufficient heat demand where district heating is a low regrets option. This will include consideration of technological solutions, including district heating, electric heat pumps, repurposing of the gas network for use of biogas and/or hydrogen, etc. We will look to put forward a more detailed proposal on how we will realise this potential in subsequent Climate Change Plans as our understanding of the best approach develops.

The Gas Network is reserved to the UK Government (whatever gas is transported through those pipes). The UK Government is developing work considering long term heat decarbonisation - post 2030. This will over the coming years gather evidence and analysis and try to fill key gaps relating to options such as future of the gas grid, electrification of heat and district heating and the significant impacts on infrastructure requirements that picking one or a mix of these options would have. Policy decisions are not expected to be made by the UK Government until the next parliament, i.e. from 2020.

Table 10-8: Policy outcome 2 over time [6263]

Policy outcome 2

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

2031

2032

By 2032 94% of non-domestic buildings' heat [62] is supplied using low carbon heat technologies [63]

64%

65%

94%

10.6 Progress since RPP2

Table 10-9: Progress on RPP2 policies

RPP2 Policies

Summary of progress

Smart Meters

Roll-out of "smart" meters to small and medium-size businesses to encourage better energy management. The UK Government has committed to offering a smart meter to small and medium-sized businesses by 2020.

CRC Energy Efficiency Scheme

This scheme has operated throughout the UK since 2010 and was evaluated in 2015 by the UK Government. The evaluation concluded that whilst increasing energy costs have been the biggest driver on energy efficiency there is evidence that the CRC had a beneficial impact on energy efficiency behaviour and reduced carbon emissions growth by 6-8% between 2010-12 compared with the 2010 Impact Assessment prediction of a 2% annual reduction under the original policy design, and led to a reduction in electricity consumption growth of least 3-5%. The UK Government has announced its intention to abolish the CRC and replace it with increased rates of Climate Change Levy and a new business energy reporting framework.

Buildings Energy Standards (2010) - New Build Properties.

This policy was implemented on 1 October 2010 and results in lower emissions from new buildings. Standards set under this policy were further strengthened by a subsequent review which introduced further improvements to energy standards in October 2015 (See RPP2 proposals). Improved energy standards encourage both innovation and the deployment of low carbon solutions in construction.

Green Deal and Supporting Policy

The Non-Domestic Green Deal, a GB wide policy was ended by the UK Government, without notice, in 2015 as part of a series of announcements reducing support for energy efficiency. SEEP will draw on the lessons learned from this failed scheme, in the development of finance options for non-domestic property owners and occupiers.

EU products policy

EU Products policy is addressed through the Eco-design Framework Directive. An important element of this is improving the energy efficiency of products. This reduces electricity consumption and heat output. The emissions savings from using less electricity are factored into the RPP2 calculations in the energy sector. The reduced heat output is shown here, reflected in a slight increase in emissions resulting from compensatory use of space heating. The overall effect, however, is to reduce total emissions. These policies continue.

Renewable Heat Incentive ( RHI - Non Domestic)

The Renewable Heat Incentive is a UK-wide scheme created by the UK Government (with the agreement of the Scottish Government). The non-domestic scheme helps businesses, public sector and non-profit organisations meet the cost of installing renewable heat technologies such as biomass, heat pumps (ground source, water source and air source), deep geothermal, solar thermal collectors, biomethane and biogas, combined heat and power ( CHP) systems. Payments are made over 20 years and are based on the heat output of the system. There is no commitment to funding the RHI beyond 2020/21 and during the development of SEEP we will consider what sort of funding mechanisms are needed into the 2020s and 2030s to enable continued take-up of these technologies.

Low Carbon Heat (Non Domestic)

The Scottish Government published the Heat Policy Statement in June 2015, setting out our heat hierarchy and the actions and policies we are taking to reduce demand for heat and ensure its decarbonisation. The development of SEEP will continue to deliver the actions set out in the HPS, alongside development of the new Energy Strategy, including ongoing support for the Heat Network Partnership and funding for district heating via the District Heating Loans Fund.

Table 10-10: Progress on RPP2 proposals

RPP2 Proposals

Summary of progress

New-build non domestic energy standards for 2014

Proposal is now a policy, implemented in October 2015 and delivering intended outcomes. Energy standards for new non-domestic buildings, emissions from new buildings are now in the region of 75% lower than for buildings constructed to the standards applicable in 1990. Standards continue to encourage both innovation and the deployment of low carbon solutions in construction but show poorer cost/benefit as performance sought is more challenging.

Assessment of Energy Performance and Emissions Regulations (Non Domestic Buildings)

Proposal is now a policy. From 1 September 2016, The Assessment of Energy Performance of Non-domestic Buildings (Scotland) Regulations 2016 require owners of buildings over 1,000 m² offered for sale or rental to assess and ultimately improvement the energy performance and emissions of their building. Under these initial regulations, improvement may be deferred by reporting of annual operational energy use.

Public Sector (additional potential)

Public Sector (additional potential) Analysis by SFT indicated an investment opportunity of £300 million in energy efficiency projects across public sector estate delivering 174k tCO 2e reduction and could lead to potential energy bill reductions in the region of £30 million per annum for the public sector. To support their delivery of this activity SG has put in place a national procurement framework and project development unit to accelerate the delivery of these estate wide projects across the public sector estates .

Working with the Scottish Futures Trust, COSLA, Resource Efficient Scotland and NHS and supplemented by public sector loans funding through Salix we are supporting the delivery of energy efficiency project across the public sector estate and will continue to support delivery of the greener street lighting programme and delivery of district heating projects.


Contact

Email: Kirsty Lewin

Phone: 0300 244 4000 – Central Enquiry Unit

The Scottish Government
St Andrew's House
Regent Road
Edinburgh
EH1 3DG