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Is it getting hot in here?

With COP26 now upon us, all eyes are on Glasgow! As we continue to explore the various routes to net zero, there is no doubt that the Scottish Government's recently published "Heat in Buildings Strategy" will have a key role to play.

Never in recent history has there been so much focus on how we use space that was once the reserve of our personal and family lives for working…but also on how our homes work for us.

The point is well rehearsed that the quality of housing has a direct impact on a myriad of economic, social and environmental factors that are driven by where and how we live and as the upcoming COP26 Conference shines a (presumably renewably powered) spotlight on Glasgow, the Scottish Government has produced its “Heat in Buildings Strategy” which rightly acknowledges that the question of how we heat our homes and buildings is something which will touch the lives of everyone in Scotland.

The vision at the centre of the strategy seems straightforward enough:

“…that by 2045 our homes and buildings are cleaner, greener and easy to heat, with our homes and buildings no longer contributing to climate change, as part of the wider just transition to net zero”

Whilst the vision might sound simple, the Scottish Government’s climate targets require a reduction in emissions from heat in buildings of 68% by 2030 compared to 2020. Given that it seems like not too long ago that a move towards increasing sustainability in housing meant apprehensive homeowners fearing being duped by the solar panel salesman (who clearly didn’t realise that we never get any sunshine in Scotland anyway!), the path to net zero is set to be a bumpy one.

It is no secret that the aim to ensure that all homes achieve energy efficiency standards equivalent to at least EPC C by 2033 is an ambitious one – with even shorter term goals for the private rented sector. Whilst the Heat in Buildings Strategy sets out plans for a programme of at least £1.8 billion investment over the course of this Parliament to build upon, expand and improve existing programmes, with £200 million for heat and energy efficient projects in social housing over the same period, the Scottish Government has acknowledged that investment from the private sector will be required to secure delivery of its ambitious strategy over the longer term – with a new Green Heat Finance Taskforce to be established by the end of 2021 to support existing work on the finance and funding routes available Key to this will be “buy in” from businesses and the general public alike.

On the basis that the built environment accounts for almost 40% of all carbon emissions and whilst there is no doubt that there has been a leap forward in terms of making the construction process and the shiny new buildings popping up as a result more sustainable, it is estimated that 70% of the buildings that will exist in 2050 have already been built and so developers need to think outside the box in terms of maximising sustainability returns from existing stock and without the benefit of a blank canvas.

I can’t help but think of retrofitting as being an 80s style makeover for my home office, but in fact it’s something which will be essential to smoothing that transition to net zero as the government seeks to step up the pace of installations of zero emissions heating systems. However, it is also clear that some housing providers are facing the unenviable challenge of how to allocate limited funds in balancing the need for retrofitting existing housing stock in the drive to net zero, with the need to build new properties to contribute to the 25,000 new homes needed per year to address Scotland’s housing crisis.

The Scottish Government (SG) has hailed the strategy as a “significant investment opportunity that will support supply chains, jobs and a healthy economy”, but with current well documented shortages in skilled labour and materials in the construction industry – which show no sign of receding any time soon - it begs the question of just how and by who the “hard graft” of installing these new systems will be carried out.

As the huge gap in the Scottish labour market and perhaps more importantly the shortage of the right skills in Scotland is potentially one of the biggest barriers to achieving Scotland’s net zero targets, the Heat in Buildings Strategy outlines that the SG has partnered with Scottish Renewables to undertake a Heat in Buildings workforce assessment to ensure that it is best placed to support people transitioning to the 16,400 new jobs it estimates will be supported across the economy by 2030 as a result of investment in the deployment of zero emissions heat. But in order to achieve that there will need to be incentives for employers to invest in on the job training and upskilling of their workforce – something which may in fact be forced in a market where it’s simply not possible to fill more skilled positions from external sources.

The need to strengthen Scotland’s supply chain is also recognised by the SG and they will work with industry to co-produce a new Heat in Buildings Supply Chain Delivery Plan by Summer 2022 - specifically focussed on strengthening the broad supply chains needed to deliver energy efficiency and zero emissions heat in buildings at the pace and scale that will be needed to meet those ambitious targets.

There will be a natural nervousness from people around changes which not only require physical alterations to their homes, but also raise the question of who is going to foot the bill for both the capital investment and ongoing costs at a time when most are still feeling bruised by the impact of the COVID-19 pandemic. The SG has acknowledged that in some cases zero emissions systems will cost more to run than the fossil fuel systems they replace – bringing into sharp focus just how to maximise the impact of government funding as well as investment from other sources.

The importance of how the Scottish Government approaches its profile raising campaign cannot be underestimated. It is set to be included in the remit of the National Public Energy Agency which the SG has committed to establishing to take on the role of raising public understanding and awareness, coordinate delivery of investment and coordinate national, regional and local government delivery of heat decarbonisation and energy efficiency rollout, working closely with public, private and third sector partners. Public engagement will be critical so that people feel that even if they are not entirely masters of their own destiny, then at least they have a forum for making their voices heard – rather than just being swept along by the net zero tide.

What is clear is that whilst the outcome which the Heat in Buildings Strategy seeks to achieve is essential to meet Scotland’s net zero targets, no number of polices or strategies and no amount of new infrastructure alone will be sufficient. A seismic shift in individual behaviours will be required before we start to see real change and the earth’s thermostat slowly being turned down.


This information is for educational purposes only and does not constitute legal advice. It is recommended that specific professional advice is sought before acting on any of the information given. © Shoosmiths LLP 2022.


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