Conserve and Save. The Energy Efficiency Action Plan for Scotland October 2010

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1 Conserve and Save The Energy Efficiency Action Plan for Scotland October 2010

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3 conserve and save the energy efficiency Action plan for scotland october 2010 The Scottish Government, October 2010

4 Crown copyright 2010 ISBN: The Scottish Government Business, Enterprise and Energy Directorate 4th Floor, 5 Atlantic Quay 150 Broomielaw Glasgow G2 8LU Produced for the Scottish Government by APS Group Scotland DPPAS10725 (10/10) Published by the Scottish Government, October 2010 Energy Efficiency point of contact is: ii

5 Contents Ministerial Foreword 1 Summary of Actions 2 A The importance of energy efficiency: the challenge, the vision and our approach 9 B Scottish Government energy efficiency targets and monitoring 13 C Scottish Government actions and programmes: priority areas and support encouraging behaviour change domestic energy efficiency energy efficiency for business energy efficiency across the public sector Achieving energy efficiency through Building standards infrastructure for the built environment changing how we use our transport systems skills finance taking energy efficiency forward 91 The energy efficiency and microgeneration actions set out in this plan fulfil our commitment under the Climate Change (Scotland) Act 2009 to prepare and publish a plan for (a) promoting energy efficiency; and (b) improving the energy efficiency of living accommodation. They develop further the priorities and proposals set out in October 2009 in Conserve and Save: A Consultation on an Energy Efficiency Action Plan for Scotland and the detailed comments received in response (see Analysis of Responses, published April 2010). We refer you back to the consultation paper for the background to each area and the detail of activity at the time of publication. The Scottish Government is committed to promoting equality. In accordance with our Public Sector Equality Duties, impacts on equality from each of the actions in this plan will be assessed and regularly reviewed. A high level Strategic Environmental Assessment (SEA) of the consultation on the EEAP has been undertaken. A Post Adoption SEA Statement will explain how the findings set out in the Environmental Report have been taken into account in the final version of the Plan. Should any more detailed policies and proposals emerge from the EEAP, their environmental effects will be considered further as required by the Environmental Assessment (Scotland) Act iii

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7 Ministerial Foreword in october 2009, Conserve and Save: a Consultation on the Energy Efficiency Action Plan for Scotland set out details of our current policies and options on energy efficiency in scotland. this energy efficiency Action plan reaffirms our ambitious energy efficiency and microgeneration agenda for scotland. it sets out our wide-ranging programme of activity on behaviour change, household, business and public sector energy efficiency, infrastructure, skills, and finance. it builds on the consultation paper and the responses to it, and is a key component of our broader approach to meeting scotland s climate change targets and securing the transition to a low carbon economy in scotland. the plan is aimed at energy consumers and those who want us to reduce energy consumption in scotland. energy use underpins activity across all sectors - business, domestic and public. it is also responsible for the major share of our greenhouse gas emissions, which contribute to climate change. By maximising the output from our energy inputs, energy efficiency and productivity offer a way to curb energy consumption without limiting growth and hence to reduce emissions whilst still growing our economy. this plan therefore sets a framework for energy efficiency and microgeneration that furthers our climate change, economic and social agendas. it drives the cost-effective action required if scotland is to meet its challenging statutory emissions reduction targets of at least 80% by 2050 and 42% by 2020, as set out in the Climate Change (Scotland) Act in doing so, it seeks to create employment, promote new technologies, and secure wider economic benefits for the low carbon economy. By reducing energy consumption, it aims to reduce costs for consumers whilst improving levels of comfort, and to improve scotland s security of energy supply. Although energy efficiency has long been part of energy policy, issues around climate change, energy scarcity and global population growth now converge to demand a far more radical change in our patterns of energy use. As we move to a low carbon society, energy efficiency must become a priority across all scottish government work, complementing scotland s other energy-related strengths and working across areas such as housing, transport and business to help us achieve our purpose of sustainable economic growth. in promoting the benefits of energy efficiency and microgeneration across scotland, we must engage with people and organisations at all levels. We must be consistent and co-ordinate our activities across the wider climate change and economic agendas in order to focus attention, to identify the important strategic issues, and to encourage practical action. our key actions relating to energy efficiency include to: improve the energy efficiency of all our housing stock to meet the demands of the future; establish a single energy and resource efficiency service for scottish businesses; develop a public sector that leads the way through exemplary energy performance and provides the blueprint for a low carbon scotland; reduce our transport energy demand, transforming how we use our transport systems; promote infrastructure improvements, e.g. by developing a sustainable heat supply; and ensure that people are appropriately skilled to take up the opportunities. We will progress the actions in this plan through engagement with partners and the public as an integral part of our ongoing work to develop proposals and policies for climate change and make the transition to the low carbon economy. this is a priority area for scottish government and will remain a key focus of our activity over the coming months, years and decades. The Rt Hon Alex Salmond MSP first Minister of scotland 1

8 Summary of Actions the energy efficiency Action plan for scotland sets out the framework for the scottish government s comprehensive approach to energy efficiency and microgeneration. it focuses on their contribution to energy and economic development, their role in reducing energy consumption in buildings and transport, and their role in delivering climate change targets. in order to deliver the targets set in the climate change (scotland) Act 2009, we must deliver a stepchange reduction in energy use and move to non-carbon alternatives. section A of this plan reinforces the urgent need for action on energy efficiency. it outlines the challenge, our vision, and our approach. section B introduces a headline target to reduce scottish final energy consumption by 12% by 2020, with an indication of how this will be monitored. it also outlines a reporting framework with a number of key indicators that will provide supportive information to the headline target, and highlights a range of areas where the scottish government intends to improve data gathering, monitoring and reporting of key energy efficiency action. section c outlines our actions, programmes and support across priority areas. these are as follows: 1. Encouraging Behaviour Change We will focus attention on understanding and shifting behaviour through our co-ordinated approach to Climate Change research, sustainability in education, and influencing practical behaviour through social marketing, information and advice. Action 1.1 in order to understand how best to influence energy efficiency behaviour, we will address energy efficiency within the scottish government s climate change Behaviours research programme and apply the lessons from this and other research to ongoing energy efficiency policy making. Action 1.2 We will educate our citizens about the principles of energy efficiency, most notably working with schools, colleges and universities, and the wider community in scotland to deliver the actions set out in Learning for Change. Action 1.3 in order to influence the wider public, we will use scottish government social marketing research, in tandem with the output of the climate change Behaviours research programme and other social research, to inform and build future marketing campaigns related to energy efficiency. energy efficiency will come under the new overarching greener scotland climate change narrative, and we will employ the single natural scotland brand identity across all scottish government communication. We may also include, when appropriate, the energy saving trust and carbon trust identities. Action 1.4 We will communicate helpful information and advice to the groups who need to take forward energy efficiency in a way that is coherent, consistent, and easy to understand. Within this, we will: continue to support organisations such as the energy saving trust and carbon trust to provide advice to domestic and small business users and to larger smes and energy intensive businesses respectively; and streamline delivery of our support for the est s energy efficiency, fuel poverty and transport programmes. Action 1.5 We will engage with individuals and organisations across scotland in a consistent and coordinated way, developing our energy efficiency stakeholder engagement plan within context of broader climate change and low carbon engagement. 2

9 2. Domestic Energy Efficiency Improving the energy efficiency of the domestic sector is vital, as around 29% of all energy consumed in Scotland is used in our homes for space and water heating, cooking, lighting, and running electric appliances. Action 2.1 Within available resources, we will continue to provide ongoing support and financial assistance for energy efficiency in existing housing, levering investment from energy companies and private householders wherever appropriate. Action 2.2 We will regularly review energy efficiency programmes to make them more effective in achieving the outcomes of reduced fuel bills for scottish households, reduced emissions, reduced fuel poverty, and a strong energy efficiency industry in scotland. this includes increasing the uptake of gb-wide programmes. Action 2.3 We will continue to work closely with decc in the development of future gb-wide programmes to improve deliverability in scotland to make it easier for scottish householders to benefit from these schemes. Action 2.4 With relevant partners, we will investigate options for financing mechanisms for major energy efficiency measures in private sector housing. Action 2.5 historic scotland will take the lead in researching and promoting energy efficiency in traditional buildings. As part of this it will: i. carry out research and case study projects, and disseminate findings to and through relevant partners, publications and digital media in order to improve advice provision, skills and qualifications for the public and professionals on energy efficiency improvement of traditional housing; and ii. include energy efficiency in domestic properties in its existing and future regeneration and grants programmes, such as the conservation Area regeneration scheme. Action 2.6 We will further develop our powers to enforce energy efficiency standards in the private sector, including by publishing a Ministerial report on our position on regulation by the end of March Action 2.7 We will work with social landlords and other stakeholders to consider how best to meet carbon reductions from social housing, including the development of an appropriate energy efficiency standard beyond shqs. Action 2.8 We will strengthen guidance for local housing strategies by issuing supplementary guidance jointly with cosla on local authority coverage of climate change as a key step in progressing further local councils activity on energy efficiency and climate change towards a more strategic approach integrated with fuel poverty and mainstream housing policies. 3

10 3. Energy Efficiency for Business We will support businesses to maximise competitiveness through the improved energy efficiency of non-domestic buildings and business processes and by taking advantage of the opportunities that energy efficiency will offer in the transition to a low carbon economy. Action 3.1 energy efficiency is a key area of opportunity underpinning the transition to a low carbon economy and makes a significant contribution to the low carbon economic strategy currently being developed in partnership with our enterprise agencies, sepa and others. Action 3.2 We will actively promote the provision of energy efficiency advice to businesses in scotland, including through the establishment of a single energy and resource efficiency service. Action 3.3 We will engage with industry more deeply on a sector specific basis, including by supporting the roll out in scotland of the carbon trust s industrial energy efficiency Accelerator (ieea). Action 3.4 We will encourage businesses to develop and use innovative energy efficiency solutions by focussing the ViBes (Vision in Business for the environment of scotland) judges special award in december 2010 on energy efficiency. for future years, we will investigate the possibility of developing an award specifically for energy efficiency within the ViBes scheme. Action 3.5 We will drive forward the crc energy efficiency scheme in scotland, ensuring that it delivers on energy efficiency for large, non-energy-intensive scottish public and private sector organisations. 4. Energy Efficiency across the Public Sector We will provide clear energy efficiency guidance and leadership to the public sector to enable the delivery of energy saving improvements and exemplary behaviour. Action 4.1 We will use the guidance on the public Bodies climate change duties to support the delivery of improved energy efficiency across the public sector. Action 4.2 We will support public bodies to reduce the energy consumption of their estate and to embed good energy efficiency practice within their organisation by funding organisations such as the carbon trust to provide expert technical, behavioural and change management advice, tailored to the size of the organisation. Action 4.3 Working in partnership with the carbon trust and public sector representative bodies, we will develop a methodology for setting appropriate energy saving targets for the public sector in scotland. We will then: i. set an overarching energy saving target for the sector as a whole; and ii. ensure, in collaboration with the sector, that all public bodies set individual annual energy efficiency targets. Action 4.4 We will work with the carbon trust to develop an asset mapping approach through to 2050, initially for the largest public sector building assets. Action 4.5 We will work with the carbon trust to produce guidance by the end of March 2011 on the procurement of energy efficient, low carbon buildings in the public sector. Action 4.6 We will maximise the potential of available financial support for energy efficiency projects on the public sector estate. 4

11 Action 4.7 We will promote the reporting of public sector energy consumption, including by: i. publishing details of the scottish government s weekly energy consumption in our headquarter buildings by spring this will be supported by rolling out the installation of Automated Meter reading equipment for electricity and gas across those buildings that we are required to report on under the crc energy efficiency scheme; and ii. working with the public sector to ensure that all public bodies report on their energy consumption, and their progress in attempting to reduce this, at regular internal board meetings. 5. Achieving energy efficiency through Building Standards We will drive improvements to the energy efficiency of Scottish building stock through building standards. Action 5.1 We will introduce new energy standards in october 2010, which will deliver a 30% reduction in carbon dioxide emissions from new buildings when compared to 2007 standards, and will further review energy standards for 2013 and 2016 to help meet our emissions reduction targets. costing research will be carried out in to support the review for Action 5.2 We will consider the impact of introducing water efficiency measures into the building regulations in Action 5.3 We have established a working group drawn from across the design and construction industry to explore the development of a sustainability labelling system for domestic buildings. this work would be extended to non-domestic buildings in due course. Action 5.4 We will continue to publish online guidance on low carbon equipment that include issues relating to building regulations. Action 5.5 We will undertake research on providing information to building occupants to optimise the performance of low carbon homes. Action 5.6 We will introduce improved energy efficiency measures in october 2010 for extensions, conversions and alterations, including where building elements such as boilers, cooling systems, windows, and doors are being replaced. Action 5.7 We will introduce new measures for the improvement of existing buildings triggered either by the extension of a dwelling or work to an existing non-domestic building with a building services component. these will apply from october Action 5.8 We will consult publicly on proposals for implementation of the epbd recast in the first half of We will explore the possibilities of holding a national register on information from nondomestic energy performance certificates, with a view to building on current mapping work. Action 5.9 in 2010 and 2011, we will explore the options for improving the energy efficiency of existing non-domestic building stock through a working group, with the intention of developing regulations for

12 6. Infrastructure for the Built Environment We will proactively support developments across the built environment which strengthen the impact of energy efficiency. Action 6.1 by: We will actively promote design solutions that support energy-efficient development forms i. supporting initiatives that encourage low-carbon communities and sustainable developments, such as the 11 scottish sustainable communities initiative exemplar projects; ii. implementing the designing streets policy, which aims to prioritise pedestrians and cyclists over vehicle movement in new or retrofitted streets. Action 6.2 We will proactively develop district heating as a discrete policy area within energy efficiency, including by: i. appointing a dedicated officer to take forward district heating policy and co-ordinate activity across scottish government; ii. supporting a number of local heat mapping and feasibility projects over 2010/11; iii. investigating options for training or workshops for planning authority officers; iv. pursuing options to finance district heating projects; and v. sepa s advice to planning authorities re. water, heat and power. Action 6.3 account by: We will ensure that planning policy takes the potential contribution of microgeneration into i. carrying out consultations on permitted development rights for microgeneration in domestic and nondomestic properties and bringing relevant legislation into force by April 2011; and ii. working with planning authorities to meet the terms of section 72 in a way which is consistent with scottish planning policy. Action 6.4 We will actively promote microgeneration, most notably by: i. seeking to maximise feed in tariff and proposed renewable heat incentive investment in scotland; ii. supporting the development of a scottish Microgeneration certification scheme (Mcs) certification body and exploring other barriers that hinder widespread participation in Mcs; iii. publishing a series of online guides on low carbon equipment; and iv. our work on skills and to reduce consumption in the transport network. Action 6.5 scottish Water will prepare a plan by , outlining how it intends to promote water conservation and water-use efficiency. 7. Changing how we use our Transport Systems We will create an energy and fuel efficient transport system as part of our drive towards a low carbon future for Scotland. Action 7.1 We will seek to reduce the need to travel, in particular through further analysis of the community-hub concept to test issues of planning, likely demand, community and business engagement, and value for money. 6

13 Action 7.2 We will extend travel choices to include more sustainable transport options through: i. supporting more active travel - implementing the cycling Action plan to achieve our vision of 10% of all journeys being by bike in 2020 and supporting this with additional funds this financial year; ii. widespread travel planning - including a range of measures to encourage its use and improve its impact in organisations and schools and - for households - reviewing the scottish-based smarter choices, smarter places demonstration programme, and using the lessons learned to work with cosla, regional transport partnerships and local authorities to consider how best to deliver personal travel planning post-2011; iii. management of car parking and road space - working with cosla, local authorities, and business organisations to consider potential policies relating to parking management, and examining any legislative requirements; iv. working with local authorities to increase the number of car clubs in scotland and exploring innovative funding packages as a means to support new car clubs; v. supporting the bus industry in adopting low carbon buses; vi. continuing to promote modal shift to rail and more efficient rail services; and vii. continuing to promote the benefits of high speed rail as a long-term infrastructure investment. Action 7.3 We will encourage more efficient driving and reduce energy consumption in the transport network by: i. working with industry and motoring and freight organisations to establish how the driver training market can best deliver eco-driving training to improve vehicle efficiencies and reduce fuel consumption; ii. reducing carbon from the scottish vehicle fleet by raising awareness of available UK funding support for low carbon Vehicles (lcvs) and building on this with specific scottish interventions, e.g. encouraging the public sector to show leadership through the visible procurement of lcvs and their required infrastructure; iii. seeking to improve the operational efficiency of our trunk road network through the deployment of intelligent transport systems; iv. continuing to operate the trunk road and motorway network in the most efficient manner and seeking to reduce energy consumption by roadside electrical equipment; v. continuing to support the rail industry in developing emission reduction techniques. 8. Developing the Skills for Energy Efficiency In making the most of the new opportunities presented by energy efficiency, we will ensure that our training and education systems are ready and capable to develop the required skills and knowledge so that as many people as possible take up the openings in employment. Action 8.1 We will assess the energy efficiency skills demand and current activity by: i. undertaking a programme of work to draw on existing labour market information from sector skills council and scottish government surveys; ii. assessing the skills implications of this predicted demand in terms of: i) numbers of employees affected; and ii) the level of engagement required to support energy efficiency in scotland; and iii. working with sector skills councils and other industry bodies to undertake an assessment of current and planned training provision with an energy efficiency emphasis. 7

14 Action 8.2 We will strengthen our links with the skills work carried out by the department for energy and climate change (decc) and its green deal skills project, tying in with the energy efficiency partnership for homes skills work group. Action 8.3 We will establish a delivery-focused skills group, made up of key partners, to agree a framework for taking forward energy efficiency and microgeneration skills activity. Action 8.4 We will raise business awareness of the skills implications of forthcoming regulations and requirements, demonstrating clear demand and the need to invest in skills. Action 8.5 We will actively promote the development of skills and innovation in energy efficiency for the design and construction sector by: i. developing low-carbon and sustainable industries and disseminating good practice through projects such as scotland s housing expo 2010; and ii. supporting industry in achieving energy efficient solutions through initiatives such as the scottish sustainable communities initiative design competition. 9. Financing Energy Efficiency We will pursue our work on financing energy efficiency on three fronts: i. making the case for spending on energy efficiency in future budgeting decisions as part of the broader climate change and economic agendas; ii. seeking to maximise the contribution that other public funding can make to energy efficiency, e.g. from Europe; and iii. exploring new finance mechanisms. Action 9.1 We will ensure appropriate scottish government funding for energy efficiency activity, based on the contribution that this can make to climate change targets and economic development activity. Action 9.2 We will actively engage with UK and eu funding policy for energy efficiency with a view to maximising the value of UK, eu and other international funding in scotland. Action 9.3 We will investigate new and further funding options for implementing energy efficiency programmes, working closely with the scottish low carbon investment project, the 2020 group, and other appropriate groups to investigate alternative funding models. 10. Taking Energy Efficiency Forward We will seek to drive forward energy efficiency through our partnerships within Scotland and our national and international engagement, using these to promote and learn from best practice. Action 10.1 Within scotland, we will provide leadership and develop strong partnerships to help share best practice and ensure that everybody plays their part in driving forward energy efficiency. Action 10.2 We will work with partners from across the UK to promote joint working and learning, and will be asking the UK government to guarantee that its new policies will support the aims of this energy efficiency Action plan. Action 10.3 We will further the aims of this plan through our international engagement and by seeking to influence european policy in our common energy efficiency interests. 8

15 SECTION A The importance of energy efficiency: the challenge, the vision and our approach

16 The importance of energy efficiency The Challenge energy is a key sector for scotland, with high growth potential and the capacity to boost productivity and secure international competitive advantage. its use is a major feature of our way of life and underpins activity across all sectors business, domestic and public. however, it is also responsible for the major share of our greenhouse gas emissions, which contribute to climate change, the most serious problem facing the global community. therefore, we need to be smarter about how we use it and to reduce demand in a way that does not impact adversely on economic growth or people s levels of comfort. We also need to produce the energy we need from noncarbon emitting sources. this is in response to multiple and pressing energy challenges, climate change, and the need for individuals, public sector organisations and business all to save money in the face of rising energy costs and tight economic circumstances. The Energy Challenge includes rising global oil and gas prices; concerns about declining future oil and gas supplies in Scotland and internationally; and related concerns about the potential security of energy supply, dependency on politically less stable countries, and increasing geo-political conflict. All of this is against a backdrop of global population growth and a period of unprecedented increase in consumption and energy demand, fuelled by developing economies such as China and India. Concerns about supply are matched by increasingly volatile and fluctuating prices. climate change is partly caused by our energy use and will in turn directly and indirectly affect our energy infrastructure. This includes through increasingly severe and frequent extreme weather occurrences, rising sea levels, increased temperatures, and flooding and subsidence. The challenge is immediate, as it is far more cost-effective to act now against climate change through energy efficiency and reducing emissions, than to pay later the costs of inaction. In 2006, Lord Stern noted that whilst the stabilisation of greenhouse gases will cost 1% of GDP by 2050, the direct costs of unabated climate change could range from 5%-20% of GDP per year. In 2009, he recognised that his original Review had underestimated the size and costs of the effects of global warming, making it all the more imperative that we act immediately. The Scottish Government has therefore set itself challenging climate change objectives: to reduce emissions by 42% by 2020 and by 80% by To achieve these, Scotland needs to improve hugely the energy efficiency of its activities and to supply the consequent energy requirements from renewable and low-carbon sources. Compared with many of the alternative energy supply solutions, investing in energy efficiency measures will help us to achieve these goals now, as they offer the simplest and most cost-effective way to reduce greenhouse gas emissions quickly. In 2006, Stern confirmed that energy efficiency measures have the potential to be the biggest source of emission savings in the energy sector by 2050, giving both environmental and economic benefits as they cut waste and often save money. this needs to be done in a way that minimises any tensions between the individual economic, wellbeing and climate change drivers of overall energy efficiency, as well as the impact of the rebound effect (see consultation paper, p. 27, for discussion of rebound). for example, i. a narrow interpretation of energy efficiency may not necessarily involve overall demand reduction, but rather a more efficient processing of energy and, in the case of business, perhaps more of it as companies take advantage of market opportunities and increase output. for business, the message is that it has to use energy more productively. 10

17 The Fuel Poverty Challenge: Energy prices are expected to rise dramatically over the next decade. By 2020, retail gas prices are forecast to be 31% higher in the domestic sector and 35% higher in the non-domestic sector. Domestic electricity prices are forecast to increase by 34% and nondomestic prices by 30% (UK Low Carbon Transition Plan, Analytical Annex, July 2009). 618,000 households in Scotland were in fuel poverty in 2008 (Scottish House Condition Survey), and the Scottish Government is committed to ending fuel poverty, so far as is reasonably practicable, by Energy efficiency activity by individuals and businesses is vital to ensure that the total increase in average energy bills is significantly lower than the expected increase in the unit price of electricity and gas. By working to keep bills down, energy efficiency can help to protect those already in fuel poverty and prevent their numbers from swelling, protecting low-income families who are particularly vulnerable to rising costs. ii. overall energy consumption must be reduced, and householders need to improve the energy efficiency of their homes and to save energy. yet it may be appropriate for some fuel poor households in previously very cold or damp homes to take advantage of some of the energy efficiency savings by heating a little more for health reasons, or by using additional fuel for home cooking where this has been avoided for reasons of cost. iii. it would be counterproductive for people to use the energy or costs saved on other high energy or carbon emitting activities, e.g. more flights. our challenge is to strike a balance between the detail of the many policies we seek to promote, all in the context of improving overall energy efficiency, significantly reducing total energy demand and related emissions, and improving sustainable economic growth. Our vision energy efficiency seeks to maximise the output from a given set of energy inputs and thereby to improve energy productivity and reduce overall energy consumption. it offers a platform to limit or reduce emissions that does not necessarily limit economic growth as it seeks to reduce costs for businesses and homeowners, boost productivity, and provide some in industry with new markets. in a time of constrained public finances, it also reduces the costly need to expand grid supply. our vision is of a thriving, successful, energy efficient scotland which has significantly reduced its greenhouse gas emissions and fully exploited its economic potential to become a flourishing low carbon society. As such, it will be as sustainable as possible in its use of energy and have reduced its impact on local and global environments, whilst creating new jobs and future prosperity. in this, energy efficiency and microgeneration will have reduced overall energy consumption, helped minimise carbon emissions, promoted the sustainable use of natural resources, and boosted wider productivity. energy efficiency and microgeneration provide a pivotal link between our challenge of reducing emissions and our vision of a successful and economically thriving scotland. We want to promote a scotland in which energy efficiency is a way of thinking, behaving and operating. We want to make our energy supply itself more efficient, whilst additionally boosting our energy security. We want our homes and buildings to benefit from the most appropriate and advanced technologies and for people to enjoy the same or sufficient levels of comfort for the same or less cost without harming the environment. We also want our businesses to maximise their share of the growing market for energy efficiency improvements and to strengthen their capacity to innovate as scotland grows its expertise and business base in this area (see our discussion document Towards a Low Carbon Economy). in this, we want scotland to build on its broader energy expertise and to act and invest now. our work in energy efficiency will support wider resource efficiency, play its part in creating more highly skilled and better paid jobs, and help to build our competitiveness in a new international market. it should also help to provide better quality goods and services, create the cost savings that boost spend in other areas, and secure a higher quality environment today and sustainable legacy for future generations. 11

18 Our approach energy efficiency and microgeneration are critical to satisfying our requirements for the services that energy provides (heat, light, clean water etc.), whilst ensuring that these remain affordable and we protect the environment for future generations. this places energy efficiency at the top of our hierarchy of energy policies as the simplest and most cost-effective way to reduce emissions whilst seeking to maximise the productivity of our renewable resources. energy efficiency complements our other energyrelated strengths, and works across areas such as housing, business, and transport, all of which are major consumers of fuel, to help us create a more sustainable scotland with opportunities for all to flourish. it is also closely linked to general resource efficiency and to our ambition to create a zero-waste scotland. We will, wherever possible and appropriate, tie in our work on energy efficiency and microgeneration with other agendas, most notably climate change, economic development and tackling fuel poverty. for this reason, the actions set out in this plan form the basis for the cross-cutting energy demand reduction and resource efficiency measures that are a key component of our broader approach to meeting our climate change targets and securing scotland s transition to a low carbon economy. they also complement other scottish government policies that contribute to this agenda, for example the renewables Action plan, the renewable heat Action plan, the Zero Waste strategy, and our sustainable transport policies. this means that in some areas, such as behavioural research or skills, we incorporate energy efficiency into related climate change programmes where this furthers both broader climate change and specific energy efficiency objectives. in such cases, we drive forward energy efficiency as an explicit and core element of the wider work, and focus on additional energy efficiency-specific programmes separately where these add value. in all areas, we focus on using the appropriate mechanisms to maximise value whilst seeking to avoid duplication and minimise the overall number of plans and programmes. the energy efficiency Action plan takes a comprehensive approach, orchestrating action across all sectors to create a broad platform from which we can drive greater overall momentum. We look at energy efficiency within individual sectors (housing, non-domestic and public sector), as well as the supporting infrastructure, including planning, district heating and skills. We include microgeneration throughout, as energy efficiency and microgeneration together will help to achieve a low carbon future for our homes and workplaces. our activities across these areas are closely connected, and no section of the plan should be taken in isolation. this Action plan is intended to provide a strong, strategic focus for action on energy efficiency, to provide people and business with the confidence to invest for the future, and to stimulate demand for energy efficiency measures, products and services. it outlines the extent of our current work and the new actions for which we have already identified funding. our long-term ambition will depend on future budgets. We will continue to build on this plan, developing it further as funds become available, partnerships deliver, and innovation provides improved energy efficient materials, methods and technologies. the plan will be reviewed and regularly updated on our website. We will report on it annually on a cycle that ties in with our report on proposals and policies, and formally review it after three years. 12

19 SECTION B Energy Efficiency targets and monitoring

20 Targets and Monitoring Section 60 of the Climate Change (Scotland) Act 2009 requires that this plan should set annual energy efficiency targets and describe how those targets are to be reported on. This section: introduces a headline target to reduce Scottish final energy consumption by 12% by 2020, with an indication of how this will be monitored; outlines a reporting framework with a number of key indicators that will provide supportive information to the headline target, together with a qualitative tracking framework to report progress towards a range of energy efficiency objectives; and highlights a range of areas where the Scottish Government intends to improve data gathering, monitoring and reporting of key energy efficiency action. economists call energy a derived demand, i.e. instead of using energy for its own sake, our demand for energy is generally derived from our demand for the services that energy provides, namely heat, power, and light etc. the efficient use of energy seeks to optimise the benefits that use of energy provides, such as warmth and mobility, whilst minimising that use, especially of fossil-based energy. As a result, energy efficiency offers a cost-effective means of reducing greenhouse gas emissions whilst offering the benefits of energy use and other advantages to individuals and society, e.g. lower fuel bills, large-scale investment and employment opportunities. however, the existence of market failures and financial barriers means that energy efficiency measures are not deployed by households and businesses in a way that maximises these benefits. As a consequence, there is sound justification for government to intervene to bridge this gap between our energy efficiency objectives and the insufficient uptake of technologies to date. our targets will help to drive this intervention and monitor progress. The climate change and energy landscape in Scotland pulls together a range of actions, regulation, targets and drivers. As well as our ambitious emissions reduction target of 42% on 1990 levels, which equates to approximately a 29% reduction on 2007 levels, we also have a range of renewable energy targets that seek to deliver at least 50% renewable electricity, 11% renewable heat, and 10% renewable transport fuels by A separate energy efficiency target is important as energy efficiency offers a number of stand-alone advantages. These include the fact that householders and businesses will pay less for their fuel bills and thereby either suffer less fuel poverty or be able to spend the money saved in other sectors (though, as noted in Section A, we must work to minimise rebound across the Scottish economy). In addition to the direct benefits, energy efficiency can also indirectly assist with other targets including: Reducing emissions Reduced energy consumption in the non-traded sector (i.e. excluding electricity consumption and heat use from large power stations) will lead to direct emission reductions that will contribute towards the 42% emission reduction target by Renewable electricity targets As these are measured against gross consumption, reductions in energy use will mean that they can be met with lower levels of installed capacity. Therefore, the more expensive projects may not be required to meet our renewables targets, with a positive effect on energy bills as the costs from these projects will not be passed through to consumers. Long-term decarbonisation Power generation is included within the EU-ETS and is therefore traded. However, reductions in consumption, combined with development of energy smart technologies, will result in the most efficient path toward full decarbonisation. 14

21 Energy Efficiency Headline Target in the context of our various climate change and energy targets, it is essential that a scottish energy efficiency target is meaningful and effective in driving the government s key purpose of sustainable economic growth. We have considered a number of approaches to deliver these outcomes. in line with the preferred option in our consultation paper, we have decided to implement a clear, high-level and transparent target to reduce total final energy consumption in Scotland over the period to 2020 by 12%. final energy consumption refers to the energy used by the end user; in the case of a household, this normally covers the fuel which it uses for its heating and any electricity it uses. this ambition and target will bring energy efficiency to the forefront of action being considered as part of our effort to reduce emissions in scotland and mitigate climate change. the energy efficiency target has been set to be consistent with the range of actions being considered as part of our effort towards a 42% emissions reduction across all sectors. the target will provide a challenging goal. it will help to monitor the progress made by energy supply and demand towards the wider climate change target by monitoring the range of factors that can impact on energy consumption. the report on proposals and policies, which will be published in november, will set out in fuller detail how energy efficiency will combine with other measures to reduce carbon emissions to achieve the emissions targets envisaged in the climate change (scotland) Act The energy efficiency targets will be an integral part of the overall monitoring framework, and will therefore be subject to update and revision as we progress towards the targets envisaged in the Act. Setting and monitoring the target our energy efficiency target will be monitored using the annually reported total final energy consumption data based on the department of energy and climate change (decc) sub-national energy statistics. this data is reported annually and has a historic trend from Figure 1: Total Final Energy Consumption 2 (GWh) Period Total Consumption Actual data ,717 Actual data ,747 Actual data ,045 Average ,503 to avoid distortions specific to any single year data, it is proposed that the targets are set against a three year average baseline over the period 2005 to 2007, as reported in figure 1. if policy delivery is successful, and the uptake of measures and actions occurs at the rate anticipated, it will be possible to reduce total final energy consumption in scotland by over 19,500 GWh from the baseline level to 139,500 GWh by Figure 2: The Target Ambition (GWh) 3 Baseline Consumption (19,000 gwh) 2020 Target Maximum Consumption 158,503 12% 139,500 the activity required to achieve this is significantly over and above business as usual projections and will require concerted effort across all sectors, with the overall aim being to decouple energy consumption from sustainable economic growth across scotland. 1 data for 2003/04 is available but has not gained national statistics status. 2 future revisions to data, as methodology and disaggregation becomes more accurate, could potentially have a more significant impact on the reported consumption levels than individual energy efficiency policies. 3 target ambition estimates are rounded to the nearest 100 gwh and whole percentile unit. 15

22 Annual trajectory towards the target the climate change (scotland) Act 2009 stipulates that this Action plan should set annual energy efficiency targets. given the uncertainty around both future economic conditions and the rate of installation and uptake of key energy efficiency measures, the most appropriate approach to set annual energy efficiency targets that achieve a path towards the desired 2020 consumption level is to set annual maximum consumption levels. figure 3 illustrates these annual maximum consumption targets and the straight-line trajectory towards the 2020 target. the annually declining targets will be applied to every year from the 2009 data onwards, in line with the publication of the energy efficiency Action plan consultation document. therefore the first milestone for reporting against this target will be in 2011 for the 2009 data. Figure 3: Annual maximum consumption targets 170,000 Final Energy Consumption (GWh) 160, , , , , , ,000 Baseline these suggested annual targets provide a framework to track and monitor the overall 2020 energy efficiency target. however, they do not limit the potential to outperform the targets in early years. this flexibility is important, as any sustained reduction of energy consumption in early years of the target period will result in the additional benefits from cumulative energy and emission reductions. The target in context At a policy level, the actions required to contribute towards this energy reduction will result in a varied cost/ energy saving depending on the policy, the fuel, and the sector targeted. However, to provide some high-level context as to what this level of energy consumption reduction equates, the following high-level comparisons can be made: Scale: Based on the statistics above, the baseline total final energy consumption per capita in Scotland is around 31,000 kwh. Attributing all transport, industry and domestic consumption at a per capita level, the introduction of this energy efficiency target would be the equivalent of reducing to zero the consumption by around 614,000 people. Value: The reduction energy consumption anticipated in the domestic sector (in the form of reduced gas consumption) could result in annual fuel savings worth 325 million. 16

23 Figure 4: Energy consumption in Scotland (2007) Coal Manufactured fuels Petroleum products Natural gas Electricity Road and rail transport Domestic Industry & Commercial 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 Energy consumption, GWh Source: Scottish Government Analysis & DECC sub-national data in setting our overall target, we have considered the potential for reduction in energy consumption at a sectoral level (industry & commercial, domestic and transport). our individual sectoral considerations have included the potential impact from current and future policies that may affect energy consumption, and reasonable assumptions for any rebound effect that may result. 4 however, the impact of the recession and any recovery in economic growth has not filtered through to the data. this could lead to unexpected impacts for each of the fuels/sectors. figure 4 shows how final energy consumption differs across sectors. As a result, a target to reduce total final energy consumption will not focus on the same fuels or have comparable outcomes across these sectors. Supporting the Target in addition to a headline target aimed at reducing final energy consumption in scotland, we intend to monitor and report against a range of sector specific indicators that will highlight progress towards wider energy efficiency objectives. these indicators (detailed by sector in Box 1) will provide some accompanying explanatory evidence, which may not be apparent from a consumption based target alone, as to why energy consumption may be changing. external factors can influence energy consumption significantly, for example weather and economic conditions. the range of specific indicators will take account of the range of objectives of energy efficiency policy and help to assess important trends. 4 direct rebound is considered individually in the underlying analysis for each sector. in addition a 10% indirect economy wide rebound has been included in the assumptions of the overall target (see Conserve and Save consultation document, p. 27, for discussion of the rebound effect). 17

24 Box 1: Sector Specific Indicators Domestic Household energy rating: Standard Assessment Procedure / National Home Energy Rating SAP and NHER scores rate energy efficiency by estimating the costs of the energy requirements of a dwelling. These requirements are modelled on the basis of the dwelling s size, type, insulation, heating system and appliances. As this is a theoretical exercise, SAP and NHER scores do not reflect changes in the behaviour of a dwelling s occupants, representing instead the energy performance of the physical aspects of the dwelling. NHER scores take into account costs for space and water heating, lighting, cooking, standard domestic appliances (e.g. a washing machine) and standing charges. SAP scores take into account space and water heating and lighting costs. NHER scores also take into account variations in climate across the UK while SAP scores do not. Average SAP and NHER scores across the Scottish housing stock are estimated annually by the Scottish House Condition Survey, based on a statistically robust random sample of dwellings. Installations of key energy saving measures: Loft and cavity wall insulation are relatively low-cost energy efficiency measures which typically pay for themselves in fuel-bill savings within two to six years. The UK Low Carbon Transition Plan, published in July 2009, articulated an aspiration that all lofts and cavities be filled where practical by The Scottish House Condition Survey records presence and amount of loft insulation and wall insulation on an annual basis. The Energy Saving Trust also maintains an activity based database of installations of energy efficiency measures, including loft and cavity wall insulation (HEED). Therefore we intend to report on the installation of important energy conserving measures such as loft and cavity wall insulation which are supported by the Carbon Emission Reduction Target (CERT) and other enabling Scottish Government or UK policies. Non-domestic Final energy consumption by fuel for the Industrial and Commercial Sector The potential for changes (revisions) to the reported fuel consumption for this sector could be significant as the data improves. DECC is currently working to improve the sub-national energy consumption statistics. These are subject to considerable uncertainty and inaccuracies, for example the split between industrial/commercial and the domestic sector is based on a consumption scale (i.e. lower than 73,200 kwh is considered domestic). As a result, this process wrongly allocates a significant proportion of small and medium enterprises (SMEs). Therefore, alongside the final energy consumption by fuel, we intend to report on final gas and electricity consumption in this sector. These are available in more detailed and up to date datasets. Case study examples of energy saving action in the commercial and Industrial sector Based on Carbon Trust data and Energy Saving Trust data, we intend to report on energy saving case studies with indication of good practice and potential scaling opportunities. Transport Road transport fuel consumption per vehicle kilometre This is an important indicator for understanding whether or not fuel is being consumed more efficiently in road transport. If fuel consumption per vehicle kilometre is decreasing, then this suggests that fuel efficiency is improving. Linking this to the RPP, the aim is to stimulate this trend through a combination of measures to improve the fuel efficiency of vehicles and decrease fuel consumption through reducing the need to travel and widening travel choices. Road transport energy consumption: tonnes of fuel per 1000 of population This data is currently available and published by DECC on the tonnes of fuel consumed for road transport. This is reported both regionally and by consuming vehicle type (e.g. bus, diesel car, motor-cycle). We intend to report the tonnes of fuel at a per capita level for Scotland based on the Office for National Statistics mid-year population estimates. If tonnes of fuel consumed per capita is decreasing, then this will indicate that fuel efficiency is improving. 18

25 Data Improvement since publishing our consultation paper, we have started work to improve the detail and quality of energy consumption and emissions data available for scotland. this includes work to improve the accuracy and coverage of our energy efficiency data, split by sector, on: i. end-use energy consumption; ii. delivery of energy efficiency measures; and iii. changes in behaviours affecting energy consumption. ongoing work in this area includes: i. Working with decc to improve coverage, particularly of gas consumption statistics, by matching meter point data to the inter departmental Business register (idbr), which would provide consumption data by standard industrial classification (sic) code. ii. t he initial registration phase from the CRC Energy Efficiency Scheme closed on 30 september this will provide an initial data set with the coverage of companies across the UK (expected early 2011). Whilst this will provide a limited level of detail for energy consumption and emissions for scotland in the first stage of the scheme, we are working closely with decc and the environment Agency to ensure reporting for phase ii will provide better disaggregated data for the devolved administrations. iii. c ompendium of scottish energy statistics - we will publish scottish energy statistics in 2010, providing an overview of the statistics available on energy generation and consumption and the energy sector in scotland. Reporting and Monitoring the climate change (scotland) Act 2009 requires that this Action plan should describe how our energy efficiency targets should be reported on. this will be done within the framework of the headline target and supporting indicators set out in this section. As our work to improve our data progresses and the available data improves, the task of monitoring and reporting against scotland s progress in energy efficiency will become simpler. the key areas under which a reporting framework should be established are: i. Energy Consumption Target - the main source of data used in the monitoring of the energy efficiency targets will be the regional energy, electricity and gas consumption figures produced at a UK level by decc. the narrative above sets out our ambition and activity to improve these datasets; and ii. EnergyEfficiencyIndicators - We will work towards being able to report scottish energy efficiency action through a set of key indicators that will cover some action or behavioural related energy efficiency measures and also fabric or technology based improvements. in addition, it is our intention to monitor public energy efficiency attitudes and behaviours in the run up to 2020 as part of a long-term strategy for climate change related data collection. We will identify general environmental attitudes, as well as specific key behaviours where change can significantly impact emissions. We recognise that behaviours are very difficult to measure, but will seek to identify suitable data in order to monitor key behaviours. for example, we estimate that if every household in scotland turned down its thermostat by one degree, this could save up to 10% emissions from space and water heating in the domestic sector. Although this is an over-estimate because many households in scotland are unable to heat their homes to an adequate level to start with, it does provide an example of the 19

26 Conserve and Save: The Energy Efficiency Action Plan for Scotland significant impact that could be generated from relatively simple behavioural change. Monitoring these sorts of behaviours will enable us to gauge the effectiveness of a range of activity - by government and others - in encouraging longer-term changes in energy use and will highlight where we need to take additional action or change course. We will use the framework under development to report on our energy efficiency targets and progress on current action. 20

27 SECTION C Scottish Government actions and programmes: priority areas and support

28 Conserve and Save: The Energy Efficiency Action Plan for Scotland 22

29 C1. Encouraging behaviour change

30 Encouraging Behaviour Change

31 C1. Encouraging Behaviour Change We will focus attention on understanding and shifting behaviour through our co-ordinated approach to climate change research, sustainability in education, and influencing practical behaviour through social marketing, information and advice. in order to achieve a thriving, successful scotland, which is as sustainable as possible in its use of energy, government action and investments need to be matched by people s own actions and changes in lifestyles. As energy efficiency depends on behaviour change, we need to improve our understanding of people s energy-related attitudes and behaviours and how to influence these. this will help to secure social acceptance of the need to change and create the momentum for large-scale action. By influencing people to use resources wisely and to reduce their consumption, we hope to reduce their energy costs, to reduce emissions, and to stimulate markets to deliver more and better low carbon solutions. Action 1.1 In order to understand how best to influence energy efficiency behaviour, we will address energy efficiency within the Scottish Government s Climate Change Behaviours Research Programme and apply the lessons from this and other research to ongoing energy efficiency policy making. in promoting the responsible use of energy, it is important that we understand how people behave, which behaviours are important, and how best to influence these. since publishing the Conserve and Save consultation document, we have established the Climate Change Behaviours Research Programme (ccbrp), an evolving programme of research and analysis of individual and household level behaviour change. this has a strong energy efficiency focus. it currently features a range of in-house and commissioned research projects and seeks to understand better: the behaviours that are central to addressing climate change; the abatement potential of behavioural change activity, individually and collectively; the groups in society whose behaviours we need to target; the most effective mechanisms for stimulating, facilitating and supporting behavioural change at individual and household level; and best practice amongst smes in promoting low carbon behaviours at work. An initial research conference for the ccbrp was held in June this developed key principles for behavioural change and focused on what works in energy efficiency. We will publish other outputs from the research programme on our scottish government website over the next year. lessons will be fed into policy development, be used to focus and direct campaigns, and be built into the public engagement strategy for climate change. A range of other bodies, including non-governmental organisations (ngos), university research departments and the private sector, are also conducting their own research into energy efficiency behaviours. We will ensure that such energy efficiency research led by others is effectively brought into ongoing policy making. We are already making links with key universities on these issues, and are co-funding two new research centres with the economic and social research council (esrc) and department for environment, food and rural Affairs (defra) on sustainable lifestyles. these will include important energy efficiency projects and feature work conducted in scotland. 25

32 Taking a multifaceted approach to influencing Climate Change Behaviours Responses to the consultation paper highlighted the need for a multifaceted approach to encourage attitudinal and behavioural change and a recognition of the complexity involved in changing habits and influencing oneoff decisions, such as installing additional insulation. One starting point for thinking about climate change behaviour change is the Four Es model: Approach evolves as attitudes and behaviours change over time Remove barriers Give information Provide facilities Educate/train/provide skills Provide capacity Enable Tax system Expenditure grants Recognition/ Encourage social pressure league tables Penalties, fines & enforcement action Catalyse Is the package enough to break a habit and kick start change? Engage Community action Co-production Deliberative fora Personal contacts/ enthusiasts Media campaigns opinion formers Use Networks Exemplify Leading by example Achieving consistency in policies (see for original source) This model reflects many of our respondents views, namely that research and activity to influence attitudes and behaviours should focus on the key change drivers of finance, information, legislation/regulation, education and leadership. We will need to use a number of levers in a joined up way as we seek to influence behavioural change. For example, communication and engagement need to be part of a joined up approach in which i) the public sector leads by its own actions and delivers the right mix of incentives and regulation; ii) education, training and skills enable people to make sustainable choices; and iii) barriers to sustainable choices are removed. We will develop and refine the four Es model, seeking to strike the appropriate balance across the levers, motivators and enablers that can bring about positive changes in energy-related behaviours and habits. We will also look at what policies and initiatives are currently successful elsewhere in the UK, Europe and more widely so that we balance theory and effective practice appropriately. Action 1.2 We will educate our citizens about the principles of energy efficiency, most notably working with schools, colleges and universities, and the wider community in Scotland to deliver the actions set out in Learning for Change. it is vital that we educate people from an early age about the importance of energy efficiency alongside other sustainable behaviours. learning is key to delivering change, and sustainable development is an important cross-curricular theme in the curriculum for excellence. our consultation paper (pp ) has already outlined important work being taken forward in community learning and development, further and higher education, and schools (including early years, eco-schools and the schools global footprint resource). in May 2010, Learning for Change, the action plan for the second half of the Un decade of education for sustainable development, set out a range of actions across schools, colleges and universities and the wider community in scotland that will deliver a change in behaviours to bring about 26

33 a greener future. A number of these have specific reference to energy efficiency and reducing energy consumption. Action 1.3 In order to influence the wider public, we will use Scottish Government social marketing research, in tandem with the output of the CCBRP and other social research, to inform and build future marketing campaigns related to energy efficiency. Energy efficiency will come under the new overarching Greener Scotland Climate Change narrative, and we will employ the single Natural Scotland brand identity across all Scottish Government communication. We may also include, when appropriate, the Energy Saving Trust and Carbon Trust identities. social Marketing is one of the many levers that can be activated to encourage people to make voluntary changes to their lifestyles. We intend to strengthen the link across the various strands of greener social marketing by creating a greener scotland climate change overarching narrative and strategy. this will draw together, under the natural scotland brand, all scottish government marketing campaigns which aim to deliver a greener scotland. these will include go greener (campaigns may include energy efficiency, and travel & transport), Zero Waste (recycling and other waste-related topics) and food (eat fresh & seasonal). they will also cover additional work for campaigns linked to the energy saving trust and its products. this will result in a more joined up approach, ensuring that the importance of an overall greener lifestyle is communicated, rather than individual cherry picking of greener behaviours. Action 1.4 We will communicate helpful information and advice to the groups who need to take forward energy efficiency in a way that is coherent, consistent, and easy to understand. Within this, we will: continue to support organisations such as the Energy Saving Trust and Carbon Trust to provide advice to domestic and small business users and to larger SMEs and energy intensive businesses respectively; and streamline delivery of our support for the EST s energy efficiency, fuel poverty and transport programmes. We will continue to co-ordinate the various scottish government schemes, products and campaigns, monitoring how they fit together with other support packages and campaigns (for recent information campaigns, see Conserve and Save consultation, pp ). We will seek to eliminate duplication and confusion, and to maximise accessibility, consistency and clarity of purpose and message. We will do this partly by publishing details of energy efficiency advisory schemes in scotland on our website and by joining up the processes for marketing these programmes. We will ensure that we promote a series of coherent and consistent energy efficiency messages. Advice to consumers and businesses The Energy Saving Trust and the Carbon Trust deliver energy efficiency information and advice in Scotland. The Energy Saving Trust primarily engages with householders and smaller businesses, including through its Energy Saving Scotland advice centres (ESSACs). The Carbon Trust provides technical energy efficiency advice to larger SMEs and energy intensive businesses, primarily through direct on-site consultancy advice. Other organisations, including the Enterprise Agencies, the Scottish Manufacturing Advisory Service, Local Authorities and the Business Gateway, may provide energy efficiency advice within their wider business service. Further activity to streamline advice to business is detailed in Action 3.2 and our forthcoming low carbon economic strategy. 27

34 Conserve and Save: The Energy Efficiency Action Plan for Scotland Action 1.5 We will engage with individuals and organisations across Scotland in a consistent and co-ordinated way, developing our energy efficiency stakeholder engagement plan within the context of climate change and low carbon engagement. Improving energy efficiency will depend on businesses, the public sector, voluntary and community groups, and individuals doing things differently. Key to our efforts to influence attitudes and behaviours across Scotland will be our work with stakeholders and the activity that they undertake to improve people s energy consumption. While we remain clear and consistent about the key messages, we must recognise the diverse range of stakeholder interest in this agenda and ensure that messages are delivered meaningfully. Individuals, communities, businesses and public sector organisations need to recognise what energy efficiency means for them, to appreciate the urgency of taking action and the dangers of not doing so, and to see the opportunities. We will develop an energy efficiency engagement plan that clearly sits within the broader evolving context of climate change and low carbon engagement. It will set out our engagement with business and business organisations, with the third sector, and across the public sector, including COSLA, Local Authorities and the NHS. It will include, for example, our liaison with UK Government departments and other devolved administrations, our work around behaviours, skills, finance, business and heat, and our engagement with the Sustainable Scotland Network. Its messages will be consistent with, and play their part in, wider climate change stakeholder engagement, most notably the public engagement strategy for climate change and related engagement around the Report on Policies and Proposals, our low carbon economic strategy, and Public Bodies Climate Change Duties. More widely, we will seek to ensure that Government policy across these and the Zero Waste Plan, Renewable Energy Action Plan and Renewable Heat Action Plan communicates a joined-up clarity of vision and leadership to industry and the public. For business, we will seek to ensure that this includes clear decisions on the technology options being supported across these areas and a demonstration of their full life costs and benefits. 28

35 C2. Domestic Energy Efficiency

36 domestic energy efficiency Passivhaus or Passive (Energy) House is a voluntary industry standard that results in buildings that require little or no energy use for heating or cooling. With the Scottish Government aiming to cut Carbon emissions by 42%, more than a third of 1990 levels by 2020, one of the main ways of achieving this will be by making homes more energy efficient. The Passivhaus Standard has been proven using tests carried out by the European Union and has emerged as the most energy efficient building design to such an extent that they could be considered to meet the EU Energy Performance of Buildings Directive recast. This calls for all new buildings to be nearly zero-energy buildings by the end of Fyne Initiatives are the first developers in Scotland to have been awarded full German Passivhaus Certification on a new build property as issued by the Scottish Passive House Centre. The property, which was unveiled in the spring of this year, is the first domestic Passivhaus in Scotland and the first social domestic Passivhaus in the UK. The terraced, 2 bedroom house is part of a development of 14 new low energy homes overlooking the Firth of Clyde in Dunoon. The Passivhaus house provides very high levels of thermal comfort and an even temperature throughout the building. Passivhaus houses are designed to optimise solar gains, and are healthy to live and work in due to fresh air supplied by the ventilation system. Fyne Initiatives used heat recovery ventilation, triple glazing with insulated frames and solar panels for hot water to meet the energy efficient standards of the Passivhaus Institute. Whilst the property will be monitored over a two year period, when asked the new resident said of her new home It seems to work, it is definitely warmer than the average house. I haven t had my immerser on as the solar panels are providing so much hot water. The temperature is averaging between degrees throughout the house and that is even with the doors and windows opened!

37 C2. Domestic Energy Efficiency Improving the energy efficiency of the domestic sector is vital, as around 29% of all energy consumed in Scotland is used in our homes for space and water heating, cooking, lighting, and running electric appliances. improving efficiency will help to achieve our key objectives of reducing green house gas emissions (25% of scottish emissions derive from homes); reducing fuel poverty and household fuel bills; and sustaining and creating a significant number of jobs. As well as ensuring that new homes are more energy efficient, we need everyone to realise how existing homes, including their own, need to change. chapter 6 of our consultation paper indicated the significant level of activity needed for the domestic sector to achieve the major reductions in emissions required by the climate change (scotland) Act Many owners and landlords already understand the benefits of energy efficiency and have taken action. the rollout of smart meters will make householders more aware of their energy use, and people will be encouraged by friends, neighbours, prospective tenants, community groups, advice services and/ or government to take action. the requirements to produce energy performance certificates (epc) and energy reports as part of the home report will further this awareness among people selling and buying homes, backed up by the prospect of future regulation in this area. We want to reach a position where potential tenants and purchasers demand an energy efficient home as a matter of course. responses to the consultation document identified broad consensus on the sectors and types of property that should be prioritised for action. these include: encouraging behaviour and building change; focussing early activity on the private sector; continuing to improve standards in the social sector - particularly where social landlords are market leaders, as in hard-to-treat dwellings; and finding a balance between building conservation and energy efficiency aims. this section outlines the action being taken, and some of the further work required, to continue to improve the energy efficiency of our housing stock through support, incentives, research, finance and, where appropriate, regulation. in summary: we will provide support and financial assistance for energy efficiency in existing housing, exploring all alternative funding sources available. We will work with the energy saving trust (est) and private landlords to improve the uptake of existing incentive programmes; we will continue to work with the department of energy and climate change (decc) to improve deliverability in scotland of future gb-wide programmes; we will work with decc on the post-2012 energy company obligation and the green deal to ensure that these policies and the UK energy security and green economy Bill are developed in a manner that will allow delivery in scotland to meet scottish circumstances. this will cover both domestic and non-domestic sectors. historic scotland will take the lead in researching and promoting energy efficiency in traditional housing; we will work with social landlords and other stakeholders to achieve carbon reductions in social housing, including developing an appropriate energy efficiency standard beyond shqs; and we will strengthen guidance for local housing strategies by issuing supplementary guidance jointly with cosla. As part of our work, we will continue to improve analysis of expected emissions, energy and cost savings in scotland of gb and scottish policies and programmes. further information on the emission savings projected from current and planned policies will be set out in the report on proposals and policies. As the actions set out in this section are progressed, and further options and technologies developed, we will continue to update our projections of predicted savings. 31

38 Please note: activity related to Building Standards for dwellings is addressed with that for non-domestic building stock in section C5. The activity outlined here should be read in conjunction with section C5 for a full picture of our action on energy efficiency for domestic buildings. General Approach As the majority of our work with reference to new buildings will be carried out via Building standards, which are addressed with in section c5, this section focuses on policies and programmes that deal with existing housing stock. Figure 2.1: Policies and programme to improve energy efficiency of housing Support and incentive programmes encouraging owners and householders to take action Scottish Government programmes UK Government/ Energy Supplier Demand led Area based Demand led Area based Local council Local Government / Landlord programmes Landlord Energy Assistance Package Energy Saving Scotland Advice Centres Home Renewables Grant Boiler Scrappage Home Loans Pilot Energy Efficiency Design Awards Home Insulation Scheme Universal access Home Insulation Climate Challenge Fund* Carbon Emission Reduction Target (CERT) Feed in Tariff (FITs) Renewable Heat Incentive (RHI)^ Community Energy Saving Programme (CESP) Green Deal / Energy Company Obligation under development Council tax discounts Increase local uptake of Scottish & supplier schemes Private: Landlord accreditation scheme Energy Saving Scotland Small Business Loans Wider Scottish Government policies standards & regulation Building standards for new homes and extension and for equipment such as replacement boilers and windows being updated in Energy Performance Certificates Scottish Housing Quality Standard (SHQS) Powers to regulate all homes for energy efficiency Planning: permitted development rights; support for microgen and low carbon district heating in SPP and NPF2 t these schemes are no longer accepting new applications. * the climate challenge fund has not been included in the funding set out in Action 2.4. ^ UK government will make an announcement during the comprehensive spending review. figure 2.1 shows the many programmes that provide support, incentives, finance and funding to improve energy efficiency in existing housing (see the Conserve and Save consultation paper for full detail). our overall approach to energy efficiency in the domestic sector is to: i. support and encourage people to take up energy efficiency measures, with incentives where appropriate; ii. develop regulation measures to require action where necessary and where advice and support have been unsuccessful; iii. work with UK government so that large-scale gb-wide programmes are developed in a manner that supports scottish households; iv. as far as possible, ensure scottish government programmes continue to be designed to make the most of other sources of investment. for example, both the home insulation scheme (his) and energy Assistance package (eap) have been designed to increase uptake of measures supported through the carbon emission reduction target (cert). 32

39 Support and Incentives: Scottish Government Programmes Action 2.1 Within available resources, we will continue to provide ongoing support and financial assistance for energy efficiency in existing housing, levering investment from energy companies and private householders wherever appropriate. support and incentives are currently provided to support directly those in fuel poverty and to provide incentives for those who are more able to afford energy efficiency measures, thereby driving forward both fuel poverty and emissions reduction objectives. for 2010/11, scottish government programmes total more than 85 million. 5 going forward, programmes will focus on: i. providing and levering in funding to improve the energy efficiency of fuel poor households - focusing funding on the most energy inefficient homes and households with limited assets and income; ii. providing advice, incentives and opportunities to lever investment to improve the energy efficiency of other homes; iii. accessing funding, for example european funding, and developing financing mechanisms with relevant partners for hard-to-treat homes and more innovative measures; also developing the industry, skills and supply chain needed to deliver much greater quantities of these measures in the coming years. Many respondents to the consultation paper called for more investment in area-based delivery of energy efficiency measures. scottish government funding for area-based home insulation schemes (his) was increased from 15 million in , to 25 million in this included 10 million for a new universal access area-based energy efficiency scheme that will offer free energy efficiency measures to around 90,000 homes. in total, we expect around 300,000 homes this year to be offered the opportunity to take up energy efficiency advice and free or discounted insulation measures where their homes are suitable through these area-based schemes. the new universal access scheme will both deliver many measures and give us valuable information on the most effective level of incentive required in this type of scheme. the new council tax discount schemes that local authorities are developing, as required by the climate change (scotland) Act, will also provide a further incentive for home owners to take up insulation measures. these schemes will inform our focus on programmes going forward. the energy Assistance package (eap) continues with a budget of 45.9 million over this focuses on providing a range of energy efficiency measures for people who are fuel poor: stage 3 includes a package of standard insulation measures that are wholly or partly funded by energy suppliers; stage 4 provides a range of measures which may include, for example, solid wall insulation and air source heat pumps, which can help hard-to-treat homes. As well as these flagship programmes, the recent energy saving scotland Boiler scrappage scheme provided an incentive for early replacement of g-rated boilers. it provided 400 towards the cost of a new boiler for up to 5,000 households. Many of these programmes are delivered through the structure of the energy saving scotland Advice centres (essacs), managed by the energy saving trust to ensure that householders are informed of wider offers and advice available to them. 5 As well as the funding for programmes referred to, this includes programmes such as the energy efficiency design Awards, energy saving scotland home renewables grants, energy saving scotland Advice centres, consumer engagement carried out by the energy saving trust. 33

40 Action 2.2 We will regularly review energy efficiency programmes to make them more effective in achieving the outcomes of reduced fuel bills for Scottish households, reduced emissions, reduced fuel poverty, and a strong energy efficiency industry in Scotland. This includes increasing the uptake of GB-wide programmes. We are committed to continuing to improve scottish government energy efficiency programmes. We will monitor the performance of our schemes on an ongoing basis and tailor them in light of experience. for example, we have extended eap stage 4 eligibility for qualifying households from those whose homes have a sap (i.e. home energy rating) below 39 to those with a sap rating of 54 or less. We are also evaluating the pilot energy saving scotland home loans scheme and will publish our evaluation in Autumn the consultation paper s strategic environmental Assessment identified that the insulation of lofts and cavities may affect bats protected by the ec habitats directive. to combat this, scottish government funded programmes for loft and cavity wall insulation will consider how they may increase installer knowledge, particularly in areas where bats are most likely found. Support and Incentives: GB-wide programmes in Scotland Chapters 1 and 6 of the consultation paper and the CERT Strategy for Scotland set out some of the issues relating to delivery of GB-wide programmes in Scotland which could lead to significant investment in domestic energy efficiency. Based on an indicative mix of measures, at a pro-rata (dwellings) rate it is estimated the CERT will deliver over 75,000 and 110,000 professionally installed cavity wall and loft insulation measures respectively each year. While smaller in scale, the Community Energy Saving Programme (CESP) will be important in the areas in which it operates and could be influential in shaping future supplier obligations. The UK Government has committed to supporting home energy improvements by developing the Green Deal. The aim is for participating Green Deal providers, such as energy companies and high street stores, to help guide customers through a simplified process of obtaining energy efficiency measures. The occupier will pay back the cost of these measures over time through the savings they make on their energy bills. This payment will be linked to the energy meter. (See UK Annual Energy Statement and news_releases/2010/ green.aspx for detail). The UK Government is also introducing powers to introduce a new obligation on energy companies to take over from CERT beyond This will be known as the Energy Company Obligation (ECO). It is anticipated to be linked to the delivery of Green Deal for specific clients or locations. Action 2.3 We will work closely with DECC in the development of future GB-wide programmes to improve deliverability in Scotland in order to make it easier for Scottish householders to benefit from these schemes. As the costs of energy companies meeting their gb-wide obligations programmes are passed on to electricity and mains gas customers 6 we will take a dual approach to gb-wide schemes. this will: i. ensure that scotland can make the most of the existing gb-wide programmes through the way we design scottish government schemes; and ii. support decc in the development of future gb-wide programmes, as appropriate, in order to improve deliverability in scotland. 6 if the costs of cert and the cert extension are passed on in full to customers of the obligated electricity and gas suppliers, this means an average annual cost of 52 per household (for a customer of both mains gas and electricity supply). see decc, extending the carbon emission reduction target, 2009, p. 14 ( ext/cert_ext.aspx). 34

41 As a first step we have set up the cert strategy steering group, chaired by the Minister for housing and communities. We are also working with decc, energy suppliers, ofgem and the energy retail Association to improve the data on delivery of cert. in september 2010, figures for scotland from the first and second year of cert were published, showing an increase in the number of measures installed in scotland from the first to the second year. 7 this is a positive outcome which, we believe, has been supported by the setting up of the energy saving scotland Advice centres and by programmes such as his and eap being designed to provide referrals to cert, as well as deliver other objectives. to ensure future schemes, such as the energy company obligation which is expected to succeed cert, are developed so that they are effective for scottish households, the scottish Minister for housing and communities has joined the Ministerial oversight group set up by UK government for the green deal programme. Support and Incentives: Finance Action 2.4 With relevant partners, we will investigate options for financing mechanisms for major energy efficiency measures in private sector housing. in the consultation paper we suggested that, due to the significant sums involved in the work required in housing over the next decade, it is assumed that those who are able to pay will invest or borrow to undertake work. the upfront cost of major energy efficiency works, such as solid wall insulation and microgeneration, is currently still a barrier to householders taking up these measures. Responses to the consultation paper suggested that it will not be easy or simple to find the most appropriate balance of funding between all parties, and generally that householders should pay (at least part of) the cost for their own improvements. The WWF campaign wanted free provision of certain measures, and some suggested that grants should be time-limited and means tested. The Scottish Government s Energy Saving Scotland Home Loan Pilot (Oct 2009-June 2010) had a high uptake with limited marketing. We have continued to make loans available in Home Insulation Scheme areas. Key differences between the Scottish Government s Home Loans Pilot and the proposed UK Green Deal Finance include: Home Loans are interest free loans; Green Deal finance is not a loan nor interest free; Home Loans are unsecured and the responsibility of the homeowner, whereas Green Deal finance payments are linked to an energy meter and paid through the energy bill so rented properties (both social and private rented) can potentially receive measures; and Home Loans have an 8-year maximum loan period, compared with a much longer repayment period (possibly 25 years). taking into account the evaluation of the energy saving scotland home loan pilot, we will investigate the options for implementing green deal finance and/or another financing mechanism for household energy efficiency. We will continue to make energy saving scotland small Business loans available to private sector landlords and to promote other funding opportunities, for example, the landlords energy saving Allowance (lesa). 7 see CERT-reports-from-HEED. 35

42 Support and incentives: Specific construction types and technologies Action 2.5 Historic Scotland will take the lead in researching and promoting energy efficiency in traditional buildings. As part of this, it will: i. carry out research and case study projects, and disseminate findings to and through relevant partners, publications and digital media, in order to improve provision of advice, skills and qualifications for the public and professionals on energy efficiency improvement in traditional housing; and ii. include energy efficiency in domestic properties in its existing and future regeneration and grants programmes, such as the Conservation Area Regeneration Scheme. historic scotland is researching technical solutions to upgrading historic and traditional homes. it will work with the energy saving scotland Advice network (essacs) in advising the public and building owners on appropriate ways of improving energy efficiency. it will provide technical input on the upgrade options for traditionally constructed homes in scotland and, with additional partners such as sust and the housing energy efficiency learning network, improve advice to housing associations on appropriate interventions on traditional tenements. in the short term, specific actions include: to investigate appropriate insulation options for traditional mass walls; to publish case studies (detached traditional dwelling and traditional tenement); to continue testing and evaluating specific interventions, such as for floors and wall insulation, in conjunction with academic and technical bodies; to disseminate research findings, case studies and advice via a range of media, through learn direct & Build, cic start (including an online video) and other partners, including a bid for an intelligent energy europe funded project; to work with construction skills to develop qualifications, for example for insulation installers and with professional bodies such as the royal incorporation of Architects in scotland (rias), the royal institute of chartered surveyors (rics) and graduate training bodies, to ensure appropriate course content for energy efficiency. historic scotland will also provide research results so that we have the best evidence available and gb-wide schemes can be developed to support improvement of traditional and historic dwellings in scotland. it will work with energy companies to identify any opportunities for improvements and interventions that are appropriate for traditional buildings and can be used towards their cert or cesp targets so that these receive funding from energy companies. Regulation and Standards: Private sector owner occupiers and private landlords Please note: Building Standards for all domestic tenures are dealt with in section C5. Action 2.6 We will further develop our powers to enforce energy efficiency standards in the private sector, including by publishing a Ministerial report on our position on regulation by the end of March

43 Conserve and Save: The Energy Efficiency Action Plan for Scotland Many owners and landlords have already taken steps to improve the energy efficiency of their homes. However, despite the advantages of this in terms of warmer homes, reduced emissions and lower fuel bills, many others have not yet done so. The Climate Change (Scotland) Act 2009 introduced wideranging enabling powers to introduce requirements to assess the energy performance of houses and to require action to be taken based on these assessments. Our consultation on this action plan was used to start to explore the form that regulation might take and the timescales within which it should be applied. The consultation received a wide range of different views on options for regulation. Following the consultation, we are continuing to investigate these options and to consider potential mechanisms for regulation. A Ministerial report on our position on regulation will be published by end March The consultation also included exploration of specific options for regulating energy efficiency standards in the private rented sector based on the Repairing Standard. It indicated that privately rented housing is more likely to be rated poor for energy efficiency than either social rented or owner-occupied properties, with around one in six private rented sector properties rated poor. The majority view from the consultation was that the regulation of energy efficiency standards in the private rented sector would be pursued best using the powers available under the Climate Change (Scotland) Act 2009 rather than through the Repairing Standard. This is based largely on the fact that the Repairing Standard requires a tenant to make a complaint before action can be triggered, whereas powers in the Climate Change (Scotland) Act 2009 afford greater flexibility. We will encourage voluntary action by landlords in the meantime, continuing to work with the Energy Saving Trust and private landlords to improve the uptake of existing incentive programmes and funding and to explore new initiatives for private rented sector properties (see p 68 of the consultation paper for details). Local councils have powers to require owners to carry out works to repair their properties. There may be scope to extend these powers to require improvements in some circumstances. This could potentially apply to energy efficiency improvements, if there were support for making such works mandatory. We will include energy efficiency improvements in our investigations relating to local authority powers and improvement works. Regulation and Standards: Social Housing Action 2.7 We will work with social landlords and other stakeholders to consider how best to meet carbon reductions from social housing, including development of an appropriate energy efficiency standard beyond SHQS. The Scottish Housing Quality Standard (SHQS) requires that social housing in Scotland has cavity wall insulation (where technically feasible and appropriate), loft insulation, hot water tank and pipe insulation, and full central heating system of acceptable efficiency. Registered Social Landlords and local authorities have set out how they will fund and meet the SHQS for all social housing by 2015 as an important first step that can be taken to help improve energy efficiency. We will publish guidance to help landlords target their SHQS activity more cost-effectively. The requirements of the Climate Change (Scotland) Act 2009 are such that by 2020 social housing will need to meet higher levels of energy efficiency beyond those arising from the achievement of the SHQS by We will work with all social landlords to develop an appropriate standard beyond the SHQS to help meet the requirements of the Act. As noted above, we will engage with the UK Government to seek to ensure that social landlords in all parts of Scotland are able to take full and fair advantage of financial support from any future GB-wide programmes. 37

44 We also need to identify new funding opportunities, such as the inclusion of innovative energy efficiency improvements in social housing as a fundable activity under european regional development funding allocations. energy efficiency in social housing, and low carbon local heat and heat and power projects for domestic and non-domestic buildings will be priority activities for the next round of urban erdf allocations (see Action 9.2). We have launched the Housing Energy Efficiency Learning Network with the scottish federation of housing Associations (sfha) and the scottish centre for regeneration. the network will provide advice to organisations and to individuals working in housing on issues such as available sources of funding, examples of best practice, and existing and new technologies to help improve energy efficiency in existing and new housing. We will use the outputs from the sfha carbon portal pilot project to inform the potential future use of thermal imaging technology to detect energy consumption performance and to target and promote sustainable energy reduction measures to households. this project, which received scottish government funding, will assess the viability of using a set of processes, methods and online tools to achieve a stepchange in energy efficiency in social housing. there are two elements to the project: thermographic imaging of around 10,000 homes both before and after insulation; and property insulation. Mainstreaming energy efficiency Action 2.8 We will strengthen guidance for Local Housing Strategies by issuing supplementary guidance jointly with COSLA on local authority coverage of climate change. This will be a key step in progressing further local councils activity on energy efficiency and climate change towards a more strategic approach that is integrated with fuel poverty and mainstream housing policies. our consultation on this plan included the future of the home energy conservation Act 1995 (heca), recognising the role that heca has played in raising the profile of energy efficiency. this reflected a commitment to review the future of heca after 10 years and the need to ensure that heca duties remain relevant in the context of the new relationship with local councils under the concordat. Most consultation respondents, and almost all local councils responding, did not consider that the information gathered under heca made a significant contribution to planning local activity on energy efficiency. Most respondents, particularly local councils, preferred that it be incorporated within other reporting mechanisms such as local housing strategies (lhs). therefore, and within the spirit of the concordat, we do not intend at this time to require further data reporting under heca. instead, local authorities will address energy efficiency within their local housing strategies and, where relevant, this will be included in single outcome Agreements. the housing (scotland) Act 2001 places a statutory duty on local authorities to prepare an lhs. it provides the strategic direction to tackle housing need and demand and informs future investment in housing and related services. cosla has worked closely with us in streamlining strategic planning for housing, and the local housing strategy is now the sole strategic document dealing with housing and related issues, across all tenures, including fuel poverty. on 24 May, we published our housing policy reform discussion document, Housing: Fresh Thinking, New Ideas. Meeting head-on the prospect of a sustained and substantial squeeze on public spending, this explored new thinking and fresh ideas and paved the way for a national discussion about housing in scotland. it recognised that good quality homes make an essential contribution to our health and well-being; that they reduce the environmental impact of our activities; and that energy efficiency is an important aspect of housing quality. 38

45 Conserve and Save: The Energy Efficiency Action Plan for Scotland The discussion document has engaged housing agencies and other stakeholders in a debate on how we can bring climate change into the heart of housing policy by asking challenging questions such as: How can we ensure that home owners take responsibility for the energy efficiency of their properties? ; and What does the challenge of climate change mean for the balance of investment between new homes and improving existing stock?. It has made clear that housing is central to the achievement of the emissions targets set out in the Climate Change (Scotland) Act While noting the progress that has been made for example, through the Scottish Housing Quality Standard, building regulations and the Energy Assistance Package it recognises the immense scale of the challenge. It also recognises that alongside the significant costs involved, there will be real and noticeable benefits in terms of reduced fuel bills and green jobs across the construction sector. The discussion document will be followed, towards the end of 2010, by a policy paper that outlines the Scottish Government s housing policy for the next 10 to 15 years. 39

46 Conserve and Save: The Energy Efficiency Action Plan for Scotland 40

47 C3. Energy Efficiency for Business

48 energy efficiency for Business carnbooth House Hotel Montgomery Property Developments Ltd (MPD) won Carbon Trust Scotland s Low Carbon Building Award for Building Refurbishment in 2010 for their re-development of Carnbooth House, near Glasgow, into a luxury hotel. The house has grade B listed status which meant that MPD were under a statutory duty to ensure that changes to the building were appropriate and sympathetic to its character. The house has solid stone walls and previously the building had no insulation in its roof or floors. In addition, its single glazed sash and case windows were cold and draughty. These factors meant that the house was difficult to keep warm and comfortable as well as expensive to heat. From the outset MPD recognised that significantly improving the thermal performance of the building would be vital to providing guests with the levels of comfort that are expected in a luxury hotel. In addition the company believed that by making the building as energy efficient as possible, they would benefit from reduced running costs year on year and that carbon emissions would be minimised. The external walls were insulated by installing rigid panels of insulation material into a new timber frame which was fitted to the internal surface of the walls. A new plasterboard covering was then overlaid on the frame to provide a surface for decoration. To improve insulation even further, the inside walls were coated with paint containing millions of microscopic evacuated hollow beads which created a barrier to heat loss through the wall. Heat losses through the walls were reduced by 80% through the installation of insulation on their internal surfaces, whilst the external appearance of the building was unchanged. The total project cost for the re-development of Carnbooth House into a boutique hotel was in the region of 5 million. Several items of work contributed to a reduction in energy use. The total cost of these items was approximately 445,000, although many of these were required to create the luxury environment that was expected for the hotel. The overall expenditure on measures specifically required to reduce energy use and provide a low carbon building was approximately 130,000. These measures provide cost savings of around 22,000 per year (2010 prices) providing a payback period of about 6 years for the investment directly in energy efficiency. Energy efficiency has been integrated into the hotel s whole management philosophy; with operating procedures designed to minimise energy use wherever possible. Energy consumption is also considered as part of a lifetime cost assessment in the purchase of equipment. The resulting low energy costs help the hotel to remain competitive and its environmental impact has been reduced through low carbon emissions. MPD intends to further expand the hotel through the construction of a new guest wing. The new building will be designed to minimise heat losses and ensure that energy is used as efficiently as possible. In addition, the company wish to install a wind turbine to supply the hotel s electricity needs. The expansion may also provide the opportunity to install a biomass boiler to supply the hotel s heating needs. Through the use of both energy efficient design and renewable energy technologies.

49 C3. Energy Efficiency for Business We will support businesses to maximise their competitiveness through the improved energy efficiency of non-domestic buildings and business processes and by taking advantage of the opportunities that energy efficiency will offer in the transition to a low carbon economy. the focus for business in energy efficiency is two-fold. firstly, as evidenced by our activity in the domestic sector, the growing requirement for energy efficiency across all sectors will create significant business opportunities. secondly, early action and transformational change are essential to make nondomestic buildings and business processes more energy efficient in order to meet scotland s climate change targets. improved efficiency can save money and reduce carbon emissions through lower energy consumption, and can create a better quality environment in which to work and deliver services. carbon trust analysis suggests that it is possible to deliver carbon savings from overall business use of nondomestic buildings in excess of the % reduction target and to deliver net costs savings of at least 4 billion across the UK. Activity related to Building Standards for non-domestic building stock is addressed with that for domestic buildings in section C5. The activity outlined here should be read in conjunction with section C5 for a full picture of our action on energy efficiency for business. In addition, we will liaise with the UK Government with reference to the development of the Green Deal Programme (see Action 2.3) for non-domestic buildings. The objective of the non-domestic Green Deal is to mobilise capital investment to allow businesses and public sector organisations to carry out energy efficiency improvements. Although it will be available to all businesses, the main focus will be on smaller organisations not included in existing policy instruments such as CRC Energy Efficiency Scheme and Carbon Emissions Reduction Target (CERT). Action 3.1 We will address energy efficiency as a key area of opportunity underpinning the transition to a low carbon economy in the low carbon economic strategy, currently being developed in partnership with our enterprise agencies, SEPA and others. the business opportunities associated with energy efficiency form an integral part of the scottish government s low carbon agenda. As we move quickly to a low carbon economy, the improvements required in energy efficiency offer the opportunity to develop high value-adding industries. in the domestic sector alone, many billions of investment will be required in energy efficiency measures and domestic renewables to ensure that climate change targets are met. this could directly support around 10,000 jobs in scotland, mainly in retrofitting existing buildings, with additional employment likely to result from the associated manufacturing, operational, maintenance, and energy management activities. in addition, we need early action to deliver large, cost-effective energy and carbon savings across the non-domestic sector, across an energy efficient heat, waste and water infrastructure, and in transport. this will require a substantial and active supply chain in scotland and will create significant business opportunities in energy efficiency. these include: the design, manufacture, supply and installation of new heat insulation, energy efficient heating systems, low energy lighting systems, and industrial/business equipment; the design, manufacture, supply and installation of smart metering and monitoring technologies, new heating, lighting and process controls, smart energy management systems, low energy it - and training of employees to use these to their full potential; research and development in smart materials and appliances, and the design and modelling of new building technologies; and development of energy services (both consultation and supply) and finance products. 43

50 the importance to the low carbon economy of the low carbon goods and services market, and specifically environmental clean technologies (ect), is significant. the sector is estimated to grow in value at a UK level from around 58.5 billion in 2007/08 to 80.6 billion in 2014/15. scotland already has demonstrable strength and growing competitive advantage in five ect areas. of these, building, transport, and environmental monitoring technologies have particular potential to contribute substantially to improving resource and energy efficiency. scottish companies are already developing solutions in areas such as electric cars, hybrid buses, energy from waste, combined heat & power, sensor systems and energy management through it. future action to nurture these markets will be outlined in our strategic approach to the low carbon economy. Action 3.2 We will actively promote the provision of energy efficiency advice to businesses in Scotland, including through the establishment of a single Energy and Resource Efficiency Service. there are strong synergies between initiatives that encourage businesses to reduce their energy demand and those that encourage them to become more efficient in their use of other resources, such as water, raw materials and waste. in addition to the financial and environmental benefits, it can be more effective for businesses to take a combined approach towards energy and resource efficiency, rather than to deal with each aspect separately. A number of organisations advise businesses on a range of business, energy and resource efficiency issues, including scottish enterprise, highlands and islands enterprise, the scottish Manufacturing Advisory service, local Authorities and the Business gateway. these may provide advice on energy efficiency within their wider business advice, referring businesses to the energy saving trust or carbon trust for more detailed energy-saving advice as appropriate. We will adopt a joined up approach to promoting such advice in scotland by establishing a single advice service that includes, and builds on the strengths of, the carbon trust, est, the enterprise agencies and sepa. this will offer a more joined-up and customer-focused service to businesses of all sizes. it will ensure that all businesses have the appropriate opportunities presented to them, improve cross-agency referral processes, and reduce the amount of information requests and time involved for small and medium sized businesses (smes). At the same time, we recognise that dedicated specialist expertise may be required to advise and support on particular aspects and projects. Current access to advice and support for businesses on energy and resource efficiency can appear unclear and disjointed. Engagement with industry by Scottish Enterprise and SEPA indicates a need for: a more effective, joined-up approach between agencies, including the need for better integration of services, better signposting between agencies, and a more customer-focused approach; the provision of clear information that adds value to business, including relevant case study material and examples of best practice; and action to remove some of the barriers that impede effective delivery, including inconsistencies between agencies. A more holistic approach to advice has already proven successful with the establishment of scotland s environmental & rural services (SEARS) initiative, a partnership between nine public bodies working together to provide an efficient, effective and joined up service to rural land managers. We have also taken steps to declutter the landscape of waste- and resource-related support and advice services by replacing seven former delivery programmes with a unified programme, Zero Waste scotland. 44

51 As part of this work, we will develop a common information and advice sheet for all who are involved in advising businesses on energy and resource efficiency across scotland. focusing on micro, small and medium sized enterprises (90% of the scottish business base), this will contain up-to-date information on what advice and support is available, which organisations are responsible, and provide the appropriate contact details. Within this, we will ensure that all scottish businesses have access to energy efficiency advice, including an energy audit, whether they are a large, energy-intensive manufacturing company or a micro business, through mechanisms such as the Carbon Trust and the Energy Saving Trust. We will work with these organisations to ensure that each has a clear remit and is appropriately signposted. this will minimise any overlap between advisory services and optimise the respective expertise of each organisation. The Carbon Trust estimates that in 2008/9 its advice helped organisations to reduce their energy bills by between 23-29m and their carbon emissions by between ktco 2. Every 1 of Scottish public money invested by the Carbon Trust delivers nearly 30 of energy bill savings to clients over the lifetime of implemented recommendations. for example, on the basis that focused workshops and training are a particularly effective way of engaging smes, the carbon trust is developing training and support packages for use with specific business sectors. it will work with local authorities, the enterprise agencies and others to explore how these tools and resources can be utilised and successfully engage business. In order to simplify the wider advice landscape to businesses, the Business Gateway is being redeveloped under the Transformational Government project, to deliver a single online portal for all public sector information, regulation, advice and support to businesses in Scotland. This will include, over time, more statutory transactions and it is likely that most, if not all, businesses will access this portal. We will complement the development of our Single Resource and Energy Efficiency Service for business by ensuring that the energy and resource efficiency elements of the redeveloped Business Gateway are improved and businesses are signposted on appropriately. Action 3.3 We will engage with industry more deeply on a sector specific basis, including by supporting the roll out in Scotland of the Carbon Trust s Industrial Energy Efficiency Accelerator (IEEA). the ieea brings together the carbon trust, industry trade associations, bodies such as the enterprise agencies and scottish Manufacturing Advisory service, and key businesses to look at sector-specific processes in a number of industrial sectors. it will accelerate cost-effective innovation in process control and the uptake of low carbon technologies, and will be able to deliver significant competitive advantage through identifying efficiencies and cost savings. total possible energy savings are estimated at over 50 million per annum in scotland. lifetime returns in scotland are estimated at a ratio of 500 in savings to industry (and the scottish economy more broadly) for every 1 of public spending. We will review progress for 2011 and beyond. Action 3.4 We will encourage businesses to develop and use innovative energy efficiency solutions by focussing the VIBES judges special award in December 2010 on energy efficiency. For future years, we will investigate the possibility of developing an award specifically for energy efficiency within the VIBES scheme. 45

52 Most government campaigns to date have focused on the domestic sector, and we want to engage the business sector more clearly. the ViBes (Vision in Business for the environment of scotland) award scheme has been running since 2000 and has recognised and awarded many scottish businesses for their excellent environmental activity. energy efficiency is already considered within the ViBes judging criteria. however, not every entrant has necessarily made energy savings as part of its environmental improvements. We intend, through an award which focuses specifically on energy efficiency, to encourage new entrants to the awards scheme and to raise awareness of the benefits of energy efficiency activity amongst other scottish businesses. Action 3.5 We will drive forward the CRC Energy Efficiency Scheme in Scotland, ensuring that it delivers on energy efficiency for large non-energy-intensive Scottish public and private sector organisations. the UK-wide CRC Energy Efficiency Scheme began in April 2010 and is intended to drive energy efficiency in larger organisations. the scottish government is a partner in the development of this policy, and will contribute to the planned review of the scheme s operation during its introductory phase (2010/ /13). Many large companies and organisations have begun the process of carrying out carbon and energy assessments of their existing buildings. some are likely to present themselves as leaders in this field. 46

53 C4. Energy Efficiency Across the Public Sector

54 seaview Primary a low carbon development by angus council Angus Council won Carbon Trust Scotland s Low Carbon Building Award for a New Building in 2010 for their development of Seaview Primary School. The development replaced the old school building which was inefficient and expensive to heat. The new school building provides a flexible learning environment which is warm and comfortable and has significantly reduced energy consumption and carbon emissions. As signatories of Scotland s Climate Change Declaration, Angus Council is committed to incorporating greenhouse gas reduction measures into new plans. The council s Education Department therefore set out to ensure that the new school building would be as energy efficient as possible. The development project was managed by an inhouse multidisciplinary team. The walls of the schools were constructed using pre-engineered timber frame panels which contain insulation produced from recycled newspaper. These panels offer insulation levels in excess of the building regulations in force at the time and they fit neatly together which reduces cold air infiltration. The windows are double glazed and have low emissivity glazing which allows sunlight to enter the room whilst inhibiting heat loss. A thermographic survey was used to assess the continuity of insulation throughout the building and secondly an air tightness test was carried out to determine the rate of air infiltration. These tests showed that the construction had been to a high standard with no faults in the insulation and the air tightness of the building was substantially better than the required level. By providing a visual picture of surface temperatures, thermographic imaging can be used to identify faults in building insulation. The thermographic survey conducted at Seaview Primary School identified no such problems with only minor heat losses around the edges of some windows. Through a careful design process and tightly monitored construction phase, Angus Council has been able to develop a low carbon school which provides a modern learning environment for its primary school and infant pupils. The school uses energy efficiently and generates its heat from renewable resources. Lights, heating and ventilation are automatically controlled to ensure that the internal environment is always comfortable without wasting energy.

55 C4. Energy Efficiency Across the Public Sector We will provide clear energy efficiency guidance and leadership to the public sector to enable the delivery of energy saving improvements and promote exemplary behaviour. the public sector needs to play a key role if scotland is successfully to reduce its energy consumption by the magnitude required to meet our climate change targets. As well as the direct environmental and financial benefits of improving energy efficiency, the public sector has the scope to act as a standard for other sectors. if the scottish government and other public sector partners expect businesses and individuals to cut their energy use, then it is vital that the public sector itself demonstrates highly energy efficient behaviour, both in the energy performance of its large estate and through the many staff it employs. the scottish government has a coordination role to ensure that relevant central and local government organisations, and other public bodies, speak with one voice on energy efficiency and have the necessary tools to contribute to an overall reduction in energy consumption. As part of this, we will ensure our various strategies and regulations, such as the public Bodies climate change duties, the leading by example programme, and the school estate strategy, complement each other. Action 4.1 We will use the commencement of the Public Bodies Climate Change Duties as an opportunity to focus attention across the public sector on improving energy efficiency and, more specifically, to advise on ways in which public bodies can contribute to delivery of the actions within this plan. the climate change (scotland) Act 2009 includes duties on public bodies to help deliver its greenhouse gas emissions reduction targets. the guidance which is currently being prepared to assist public bodies in exercising their duties raises awareness of this action plan and of support which is available to bodies in pursuing energy efficiency. such mechanisms provide opportunities to address energy efficiency across the broad range of public sector functions, including policy making, regulatory and planning functions, and the direct energy consumption from public buildings. While higher and further education providers are not part of the public sector, they have a significant contribution to make on energy efficiency. Given their intellectual leadership and education role, these sectors will develop many of the solutions to help achieve our climate change ambitions. It is therefore important that they implement measures to reduce their own energy across their significant estates. Most colleges and universities have completed a Carbon Management Programme, and over 80% have signed up to the Universities and Colleges Climate Commitment for Scotland (UCCCfS). The UCCCfS requires participants to publish a 5 year Climate Change Action Plan with measurable targets to achieve emissions reductions, including from energy consumption, and to report on progress annually. We will continue to support and work with colleges and universities to help them build upon existing work, providing access to the Carbon Management Programme and interest-free energy efficiency loans. Going forward we will engage with the Scottish Funding Council to encourage colleges and universities to utilise this support and to sign up to the UCCCfS. Through the Scottish Funding Council, we will also explore how they might feed in to the target setting and reporting which we are seeking from the public sector under this action plan. Action 4.2 We will support public bodies to reduce the energy consumption of their estate and to embed good energy efficiency practice within their organisation by funding organisations such as the Carbon Trust to provide expert technical, behavioural and change management advice, tailored to the size of the organisation. 49

56 Working with the sector, we will ensure that public bodies 8 commit to undertake the carbon Management programme if they have not already done so, and to carry out a full formal review of their carbon Management plan at least every five years. We will continue to implement our own Carbon Management Plan, which targets projects with the potential to deliver 20% emissions reduction by 2014 from a 2007/08 baseline. We have completed the energy efficient upgrading of the lighting system in our largest scottish government building, and removed bottle-fed water coolers throughout our estate. We are actively seeking further opportunities beyond those identified in the carbon Management plan, and will consider innovative funding mechanisms to help realise these. the carbon trust has also developed a carbon Management Assessment tool (cmat), designed to allow public bodies to self-assess their performance in terms of energy efficiency and carbon management. this is already helping public bodies to build on their strengths and address any weaknesses. In order for public bodies to play a leadership role in energy efficiency, they must have access to expert information and advice on how to implement physical measures and instil behavioural change. As set out in Chapter 9 of the consultation paper, the Carbon Trust drives energy efficiency in public sector organisations through various streams of its Carbon Management programme. Coverage of the Public Sector Carbon Management (PSCM) programme is ever-growing and is now approaching 100 graduate organisations. This represents a sizeable majority of the carbon and energy footprint of Scotland s public sector. The Energy Saving Trust (EST) has also provided energy awareness advice to staff at several local authorities, enabling them to influence attitudes and behaviours in the wider community. Its training resource has now been made freely available to all Scottish local authorities and can be provided in-house with little need for external support. it is likely that, as the public sector s understanding of energy efficiency improves, there will be a need in the medium and longer term for more in-depth advice to help individual parts of an organisation address specific issues. this could include technical subjects, such as information technology and street lighting, or change management issues, such as leadership and governance. the carbon trust will develop and pilot specialist modules to address such future needs. Action 4.3 Working in partnership with the Carbon Trust and public sector representative bodies, we will develop a methodology for setting appropriate energy saving targets for the public sector in Scotland. We will then: i. set an overarching energy saving target for the sector as a whole; and ii. ensure, in collaboration with the sector, that all public bodies set individual annual energy efficiency targets. in order to ensure that the scottish public sector is accountable on energy efficiency and can effectively demonstrate that it leads by example, it will be necessary to back policies with performance reporting against clear objectives. therefore, in terms of the overall action plan, the public sector must aspire to an energy reduction target which is at least as ambitious as any overall national energy efficiency target covering all sectors (see section B). together with partners such as cosla and health facilities scotland, we will develop a methodology for setting appropriate energy saving targets and set a single overarching energy saving target for the sector as a whole. We will also develop a methodology that will enable individual organisations to set their own appropriate energy saving targets, consistent with the overall sectoral target. We will ensure, in collaboration with the sector, that all public bodies set individual 8 for the purposes of the actions in this section, a list of relevant public bodies is currently under review and will be published within six months of publication of this action plan. 50

57 annual targets using this. these should be approved at chief executive level or equivalent, and both the target and progress on meeting it should be reported and published annually. As public sector energy consumption data is not centrally held or reported on, we will make tools available to ensure comparable energy data collection, management and reporting across the sector. Without this, accountability and measurement of any targets for the sector will not be significantly robust. however, although organisations increasingly need to manage energy data and produce reports, whether for the crc energy efficiency scheme, the scottish government or their own management purposes, it has become clear that one size does not fit all for public sector energy consumption reporting. We are therefore working with the carbon trust to develop a data Management and reporting Best practice guide. this will help public bodies to gather and report comparable energy consumption data, irrespective of which tool they use. Developments in the context of wider sustainability reporting and data collection since publication of our consultation paper include: We have supported and evaluated a pilot to assess the potential of Health Facilities Scotland s emart (environmental Monitoring and Reporting Tool) to be used across the wider sector. We have concluded that, while the tool holds potential benefits for other parts of the sector, there is not a business case for full roll out. In August 2010, we wrote to inform all bodies within the scope of reporting requirements under Section 76 of the Climate Change (Scotland) Act of their mandatory obligations to accurately capture estate data, including energy consumption data. We have provided access to the well-established epims (electronic Property Information Mapping Service) tool to meet these obligations. The proposed changes to the Treasury s FReM (guidelines for financial reporting in central Government and other public bodies) will see sustainability reporting included in annual accounts. National contracts for supply of electricity and gas include provision that suppliers must develop a suitable energy monitoring tool for clients. Action 4.4 We will work with the Carbon Trust to develop an asset mapping approach through to 2050, initially for the largest public sector building assets. Buildings typically account for around 80% of a public organisation s energy usage and have a long lifespan. We need to understand clearly the energy efficiency opportunities in replacing and refurbishing public sector buildings, particularly the largest ones which can deliver sizeable energy and emissions savings. We also need to understand the timing of these opportunities between now and 2020 and 2050, our target deadlines for reducing scotland s emissions by at least 42% and 80% respectively. nhs greater glasgow and clyde is working with the carbon trust to pilot an asset mapping approach for boiler replacement. this will be extended to other large public sector buildings and other aspects of their energy performance, including lighting, heating and cooling systems, and the building itself. it will give organisations a clear picture of when the major energy efficiency opportunities will arise on their estate and inform target setting in future years. 51

58 Action 4.5 We will work with the Carbon Trust to produce guidance by end of March 2011 on the procurement of energy efficient, low carbon buildings in the public sector. to supplement existing guidance, we intend to build upon the project-specific low carbon procurement support offered by the carbon trust and to promote a wider understanding of energy efficient building procurement across the sector. the carbon trust guidance will include small bodies that do not necessarily have in-house expertise in this area. this can be extended to provide guidance on the procurement of energy efficiency within major refurbishment projects and of energy efficient rented building space. it will provide a market stimulus for the provision of energy efficient buildings more widely and set an example to the broader non-domestic sector. once public bodies have access to energy efficient building procurement guidance, we should be able to demonstrate that this is utilised appropriately and that there is senior buy-in. We will work to ensure that all public bodies report on the indicative total energy consumption and emissions for any building which they procure. figures should be based upon the building in use and should indicate whether it will be in the top quartile for energy performance. We will seek approval for this report at chief executive level or equivalent before public buildings are procured, and the report should be published. The Scottish Sustainable Procurement Action Plan (SSPAP, October 2009) sets out a series of steps public bodies can follow to make sustainability, including energy efficiency, part of their everyday procurement activity. It complements our work on building procurement and larger-scale energy use by focussing mainly on goods and services, which are the most frequent areas of spend. It includes reference to the UK Government s Government Buying Standards, a range of specifications that can be used to define procurement requirements and will deliver an established minimum level of sustainability, including improved energy efficiency. Whilst the SSPAP is not mandatory for much of the public sector, it sets out good practice and its adoption will help public sector bodies to meet their commitments under the Climate Change (Scotland) Act The Scottish Procurement Directorate maintains the Construction Procurement Manual. This provides the Scottish Government and associated bodies with mandatory policy and procedures, as well as best practice guidance and advice, for delivering value for money in construction projects. Section 7 in the Construction Works Procurement Guidance chapters addresses sustainability in building procurement. Action 4.6 We will maximise the potential of available financial support for energy efficiency projects on the public sector estate. As well as reducing greenhouse gases, improving energy performance in the public sector will help to achieve value for money from the public purse and allow for greater medium-to-long term investment in frontline services. Funding is available to many larger Scottish public bodies through the Central Energy Efficiency Fund (CEEF), Salix Finance and the Scottish Government s carbon grant schemes for NHS Boards. Stakeholder feedback suggests that while CEEF has been successful in supporting refurbishment projects with a quick payback, the level of funds available and payback criteria have not catalysed many energy efficient new build projects. There are also many public bodies, particularly smaller organisations, which currently have no access to external energy saving funds. We will undertake an evaluation of CEEF by the end of 2010 to establish where energy savings have been most effectively achieved and what the key barriers to investment are. This will inform our work to maximise existing funds. 52

59 We will engage with energy and finance managers to explore the barriers to utilising existing funds where energy saving projects have been identified; the potential for funds to enable energy efficiency investment in new build projects; and where flexibility in the existing criteria could encourage more ambitious energy saving projects. subject to future spending reviews and parliamentary approval, we will also seek to establish a new public sector energy efficiency fund that will be open to both smaller and larger bodies and will be of sufficient scale to encourage more ambitious projects. discussions will be required with the sector to ensure that any future fund would be effective. however, as an example, we believe that 5 million of investment, with money allocated following a competitive bidding process, could deliver savings of over 15 million in energy bills and nearly 100,000 tonnes of co 2 over a ten-year period. Where no external funding is available, there must be senior level recognition of the benefits of investing in energy saving projects. payback is often very short, leading to quick realisation of future savings. We will engage with senior managers to ensure that energy saving projects with brief payback periods are not routinely ignored for financial reasons. As part of our wider work to finance energy efficiency (see section c9), we will consider how the public sector can best align itself more broadly with existing and prospective funding opportunities. one example of this is the prospect of significant extra funding to help regions and cities become more energy efficient, announced earlier this year by the european commission. 9 this has potential to benefit local authorities that are signed up to the covenant of Mayors, membership of which demonstrates commitment to go beyond a 20% emissions reduction by 2020 and can place local authorities well in any endeavours to secure european funding support for energy saving projects. We will support cosla s ambition to encourage scottish lord provosts to sign up to the covenant of Mayors. Action 4.7 We will promote the reporting of public sector energy consumption, including by: i. publishing details of the Scottish Government s weekly energy consumption in our headquarter buildings by Spring This will be supported by rolling out the installation of Automated Meter Reading equipment for electricity and gas across those buildings that we are required to report on under the CRC Energy Efficiency Scheme. ii. working with the public sector to ensure that all public bodies report on their energy consumption, and their progress in attempting to reduce this, at regular internal board meetings. Many of those who responded to the consultation paper agreed that energy consumption and energy efficiency progress should be reported at public bodies senior board meetings. this would help to raise further the profile of energy efficiency with senior managers and ensure that it is accorded the same importance as areas such as health and safety, the regular reporting of which is seen as standard practice. We will report publicly on our own energy consumption by publishing details of the weekly energy consumption in our headquarter buildings by spring &format=HTML&aged=0&language%20=EN&guiLanguage=en. 53

60 It is important that good practice is shared throughout the public sector, especially between organisations where common issues often arise. Groups such as the Scottish Energy Officers Network of local authority energy managers (SEON) and the High Level Group - Sustainable Scotland, which has superseded the Leading by Example External High Level Group (see Conserve and Save consultation paper, p.115), continue to support energy performance improvements in the sector. On wider climate change issues, the Minister for Transport, Infrastructure and Climate Change and COSLA s Spokesperson for Regeneration and Sustainable Development co-chair the Public Sector Climate Action Group to lead Scotland s public sector in cutting greenhouse gas emissions. Many mechanisms are already in place to share the good work underway. We will work with the sector to maximise the effectiveness of appropriate existing groups, including the Sustainable Scotland Network, the Leading by Example initiative and SEON. We will also work informally with organisations who have shared interests, such as cohorts of Carbon Management Programme graduates. Where organisations are undertaking innovative energy efficiency work, we will develop case studies so that the wider sector is aware of the exemplary work being undertaken locally and best practice is shared. 54

61 C5. Achieving energy efficiency through Building Standards

62 achieving energy efficiency through case Building studystandards Anytown Primary A Low Carbon Development by Wherever Council Building Regulations and Beyond For nearly fifty years, Scotland has had its own set of building regulations and building standards system. The regulations cover not only important issues such as; structural and fire safety, accessibility, resistance to noise and damp, but also conservation of energy. For many years the energy standards in the regulations were set at a modest level, broadly following those that existed in the remainder of the UK. Moving into the 21st century, the climate change agenda gathered momentum. The energy standards which were revised for 2002 incorporated the best levels of thermal insulation in the UK, reflecting the fact that Scotland has a colder climate saw a move to a whole building approach to setting energy standards and a focus on reducing CO 2 emissions by between 23% and 25%. At the same time, minimum levels of fabric insulation were raised, showing the way for the rest of the UK. The standards introduced at the start of October 2010 will reduce the CO 2 emissions from new buildings by a further 30%. These standards are comparable with the best in Europe. A three bedroom detached house of 100 square metres constructed to 1990 standards would emit 6.3 tonnes of carbon dioxide per year. Constructed to 2010 standards it would emit 1.7 tonnes, a reduction of 73%. A two person, one bedroom flat of 56 square metres constructed to 1990 standards would emit 2.7 tonnes of carbon dioxide per year. Constructed to 2010 standards it would emit 0.9 tonnes, a reduction of 67%. The energy standards for new building work do not require low carbon equipment, such as photovoltaics and solar water. However, they are set at a level that encourages use of these technologies. They currently cover the following subjects: Carbon dioxide emissions; Building insulation envelope; Heating system; Insulation of pipes, ducts and vessels; Artificial and display lighting; Mechanical ventilation and air conditioning; Commissioning building services; Written Information; Energy performance certificates; and Metering. All things being equal, they will reduce CO 2 emissions from new buildings by around 70% when compared to the standards that existed in 1990, the benchmark year for emissions. For example: An average office building constructed to 1990 standards would emit 105 tonnes of carbon dioxide per year. Constructed to 2010 standards it would emit 31 tonnes per year, a reduction of 70%.

63 C5. Achieving energy efficiency through Building Standards We will drive improvements to the energy efficiency of Scottish building stock through building standards. Action 5.1 We are introducing new energy standards in October 2010, which will deliver a 30% reduction in carbon dioxide emissions from new buildings when compared to 2007 standards, and will further review energy standards for 2013 and 2016 to help meet our emissions reduction targets. Costing research will be carried out in to support the review for Action 5.2 We will consider the impact of introducing water efficiency measures into the building regulations in Action 5.3 We have established a working group drawn from across the design and construction industry to explore the development of a sustainability labelling system for domestic buildings. This work would be extended to non-domestic buildings in due course. Action 5.4 We will continue to publish online guidance on low carbon equipment that includes issues relating to building regulations. Action 5.5 We will undertake research on providing information to building occupants to optimise the performance of low carbon homes. Action 5.6 We are introducing improved energy efficiency measures in October 2010 for extensions, conversions and alterations, including where building elements such as boilers, cooling systems, windows, and doors are being replaced. Action 5.7 We are introducing new measures for the improvement of existing buildings triggered either by the extension of a dwelling or work to an existing non-domestic building with building services component. These apply from October Action 5.8 We will consult publicly on proposals for implementation of the EPBD recast in the first half of We will explore the possibilities of holding a national register on information from nondomestic EPCs, with a view to building on current mapping work. Action 5.9 We will explore in 2010 and 2011 the options for improving the energy efficiency of existing non-domestic building stock through a working group, with the intention of developing regulations for New Buildings Well over half a million new dwellings, and a significant square-metreage of new non-domestic building stock, could be constructed between now and these buildings need to be as energy efficient and low carbon as practicable in order to reduce the need for retro-fitting expensive energy conservation measures at a later stage. Building standards division (Bsd) are introducing new energy standards which come into force in october the revisions deliver a 30% reduction in co 2 emissions from new homes and non-domestic buildings when compared to 2007 standards, and around a 70% reduction compared to the standards that existed in revisions will include: a 10 15% improvement in the minimum energy performance of the building fabric; improvement in the performance of building services, including improved efficiencies for space heating and hot water and the introduction of minimum efficiencies for ventilation and cooling systems; a greater percentage of low energy lighting; 57

64 an expanded role for low carbon equipment to contribute towards the delivery of co 2 savings; and a reduction in the level of uncontrolled air infiltration coupled with the introduction of random airtightness testing. for new non-domestic buildings there will be the following additional revisions: improved cooling system efficiencies and controls; and increased provision for energy metering and sub-metering including the direct metering of low carbon equipment. Bsd will further review the energy standards in time for 2013 and the 2013 review of building standards will consider water efficiency measures. As the contribution that water conservation can make to energy efficiency and reducing co 2 emissions has not been fully explored until recently, a workshop was held in september 2010, engaging with stakeholders to identify and discuss the issues associated with such an introduction. Bsd will begin costing research in to support the review for (see also Action 6.5 for scottish Water s work in this area.) Sustainability it is appropriate to encourage and reward innovation for sustainability in new buildings. We are exploring the development of a sustainability labelling system within building regulations. this would not only recognise the achievement involved in meeting the 2010 building standards, which currently present a good level of sustainability, but also define optional higher levels. the system would initially apply to dwellings and include energy efficiency and wider issues of sustainability, for example water use, noise, and the subject of adaptability. over time, the system would be developed to apply to non-domestic buildings. Low Carbon Equipment Guides and Research As building-integrated low carbon equipment, such as heat pumps and solar hot water, becomes more common in buildings, it will be necessary for those considering these technologies to be more aware of the building regulations that apply. Bsd will continue to develop online guides for low carbon equipment, building on the guides on heat pumps and solar hot water systems that were published in April these each outline the main issues of the particular technology, and consider issues such as fire safety and structure in relation to the design and installation of low carbon equipment to meet building regulations. they also include good practical guidance to optimise the energy efficiency of installations. With new domestic properties becoming more energy efficient and emitting less co 2, it can become difficult for occupiers to know how best to operate services in their dwelling. We have programmed research for to develop guidance for occupants on how to live in a low carbon home. the intention is to consider the relationship between behaviour and technology, and to define appropriate guidance for occupants to optimise the performance of new homes. Existing Buildings the improved 2010 energy standards apply when owners elect to carry out new work on their existing buildings, whether in the public or private sector. these standards ensure that the existing stock becomes more energy efficient when such work occurs, including extensions, conservatories, conversions, alterations, as well as replacement boilers, windows, and doors. 58

65 new for 2010 is a provision where owners extending their dwelling have the option either to upgrade the energy performance of the existing building fabric where it performs poorly, or to build the proposed extension to more challenging fabric standards. similarly, for existing non-domestic buildings, where alteration, extension or conversion work is subject to a building warrant and involves new building services, owners will be required to assess and make a proportionate improvement to the efficiency of existing building services should these perform poorly. Energy Performance of Buildings Directive (EPBD) energy performance certificates (epcs) fulfil the requirements of the current epbd. Whilst the european commission would have criticised any over-implementation of the directive, it has issued a recent recast and strengthened the requirements for epcs, which will be taken into account for the 2011 public consultation. information obtained from existing dwellings is held on a register which is supported by scottish government. in July 2010 information from 350,000 domestic epcs had been gathered, enabling the energy saving trust to target advice to those with the lowest epc ratings (f and g). there is currently a lack of structured data on the energy performance of the non-domestic building stock in scotland. We need to quantify co 2 emissions more accurately in order to build-up a better picture of the challenge that lies ahead. We are currently undertaking a scoping study on mapping the existing nondomestic stock. once complete, this should facilitate the targeting of measures by government, agencies, local authorities and the private sector to improve the energy efficiency of non-domestic buildings. Climate Change (Scotland) Act 2009, Section 63 A platform is required for improving the existing scottish non-domestic building stock. the provisions in section 63 in the climate change (scotland) Act 2009 give us the opportunity to do so. Bsd have set up a Working group, which includes representatives from the property and building industries, to assist with the preparation of regulations and supporting guidance. Bsd will also use the section 63 provisions to set up a register for existing non-domestic buildings. 59

66 Conserve and Save: The Energy Efficiency Action Plan for Scotland 60

67 C6. Infrastructure for the Built Environment

68 Aurora House (at South Lanarkshire College) highly insulated timber framed walls (U=0.15) photovoltaic panels sun-pipes solar panels highly insulated roof (U=0.15) bin store waste recycling and composting ground to air heat source heat recovery from ventilation rainwater harvesting triple-glazed windows and doors (U=0.80) ground source heat pump The Aurora House is a collaborative project between South Lanarkshire College, Dawn Construction and over 50 private sector partners. The project is a demonstration house that shows how a new build house can be developed that is low carbon and energy efficient, meeting the twin challenges of global warming and fuel poverty. Today Developers face a number of challenges when building new housing for sale or affordable rent These include rising fuel poverty levels and increasing fuel costs, the threat of global warming and climate change, as well as the targets to reduce Scotland s carbon emissions by 42% by 2020, and the Sullivan Report s recommendation of net zero carbon new build housing by 2016/17, if practical. The Auroa house is an ongoing project; the focus is on gaining continuing knowledge. South Lanarkshire College plan to use the Aurora Home for training and knowledge transfer and exchange. Glasgow Caledonian will monitor the home in use in order to measure the efficacy of the home and its various technologies.

69 C6. Infrastructure for the Built Environment We will proactively support developments across the built environment which strengthen the impact of energy efficiency. A number of infrastructural issues relating to energy efficiency apply across the built environment, taking in the domestic, non-domestic and public sectors. Building on chapter 10 of the consultation paper, this section outlines actions on strategic planning, district heating, industrial waste heat, combined heat and power (chp) planning, microgeneration and water. Action 6.1 forms by: We will actively promote design solutions that support energy-efficient development i. supporting initiatives that encourage low-carbon communities and sustainable developments, such as the 11 Scottish Sustainable Communities Initiative exemplar projects; and ii. implementing the Designing Streets policy, which aims to prioritise pedestrians and cyclists over vehicle movement in new or retrofitted streets. the scottish sustainable communities initiative (SSCI) aims, by way of exemplar schemes, to promote innovative, very low carbon communities, to demonstrate high levels of environmental design, to build enduring places, and to stimulate a rise in design quality standards across scotland. DesigningStreets is the Architecture, planning and transport policy statement and seeks to ensure that future development is in a form that reduces the dependency on car use and related co 2 emissions. training events across the country will be held to support implementation. Action 6.2 We will proactively develop district heating as a discrete policy area within energy efficiency, including by: i. appointing a dedicated officer to take forward district heating policy and co-ordinate activity across Scottish Government; ii. supporting a number of local heat mapping and feasibility projects over 2010/11; iii. investigating options for training or workshops for planning authority officers; iv, pursuing options to finance district heating projects; and v. SEPA s advice to planning authorities re water, heat and power. In appropriate areas, district heating allows the use of waste industrial heat, biomass or gas-fuelled combined heat and power (CHP) and results in significant energy efficiencies and CO 2 emissions savings. As much of the activity that supports low carbon district heating is the same as for renewable heat (see the renewable Heat action Plan), both are covered in this section. Responses to the consultation paper called for the Scottish Government to support district heat technologies in a number of different areas. These include: setting up an external group; support for heat mapping and feasibility studies by local authorities; greater use of planning powers by planning authorities; awareness raising among key decision makers; and capital funding. one of our dedicated heat officer s first activities will be to develop a database of existing and proposed district and community heating schemes to assist with awareness raising and heat policy development. this will be incorporated into the renewable heat data currently collected on our behalf by the sustainable development commission. it will include, where possible, costs, benefits, funding sought or obtained, network pipe distances, heat sources, and detail about types of heat users with links to case studies and contacts. 63

70 We will also seek ongoing feedback from relevant stakeholders. We will, in the first instance, operate through the renewable heat implementation group and consider over time whether there is any need to establish a separate low carbon and renewable district heating group to advise on and take forward relevant actions. the National Planning Framework for Scotland 2 advises that planning authorities should take account of the potential for developing heat networks when preparing development plans and considering major development proposals. the energy saving trust (est) has recently published a planner support pack (Sustainable Energy in the Built Environment Best practice for Scottish Planners) as part of its local authority support programme. endorsed by the royal town planning institute, this contains sections on district heating and heat mapping and provides case studies of how planners can encourage sustainable energy use. Building on this and other est work, we will investigate with relevant stakeholders the best way of ensuring that planning authority officers have the skills and understanding to take forward national planning framework 2. this may involve a programme of training or workshops for planning officers that include advice on use of the heat supply options Assessment tool (tool available on disc from [email protected]). We are also funding local projects to increase understanding of the opportunities and feasibility of district heating. phase 2 of the sustainable glasgow initiative will include detailed feasibility studies of district heating opportunities that have been identified through heat mapping work. We will extend our heat mapping support for highland council to 2-3 other councils, with the specific aim of identifying optimal areas for renewable and low-carbon district heating and specific candidates for detailed feasibility studies. We recognise that, while local authorities have a key role in identifying local opportunities for low carbon and renewable district heating, there may be strategic opportunities which cover more than one local authority area. As part of our efforts to increase awareness and understanding of district heating among key decision makers, we are commissioning a research study into the economic and technical potential for using waste heat from scottish power stations to fuel local district heating systems or other industrial sites. With regard to finance, we will seek opportunities to support the roll out of district heating and chp (see section c9). in this context: the scope of the european regional development fund (erdf) programme has been extended to introduce the possibility of funding energy efficiency and renewable energy measures in existing housing in the 13 urban local authority areas targeted by the programme. in total we can now access up to 15 million of erdf to fund low carbon, energy efficiency and district heating projects during the life of the programme; we will investigate with partners - as part of work by the scottish low carbon investment project - whether appropriate district heating projects can be included in an overall package of opportunities for international investment; we support the use of an uplift for district heating under the renewable heat incentive. With regard to waste heat, scottish environment protection Agency (sepa) will continue to seek energy efficiency through its advisory and regulatory roles and will keep the effectiveness of its processes under review. the core purpose of sepa s thermal treatment of waste guidance is to ensure that new thermal waste treatment facilities do not impede recycling or waste prevention opportunities and that they maximise the recovery of energy. the guidance requires applicants to prepare heat and power plans and to achieve a high level of plant energy efficiency through their implementation over a number of years. the high efficiency levels will require the use of heat in addition to power. As very high energy 64

71 efficiency in excess of 60% can only be achieved in a mature heat network infrastructure that does not yet exist in scotland, sepa is staging requirements on applicants to improve energy efficiency. the scottish government s updated Guidance on Thermal Power Stations in March 2010 strengthened and clarified the requirements on the use of heat in such facilities. 10 The Scottish Environment Protection Agency (SEPA) also regulates energy efficiency under Pollution Prevention and Control Regulations (Scotland) 2000 (PPC) for installations falling within the scope of the IPPC Directive (effectively PPC Part A). 10 SEPA will continue to regulate energy efficiency under PPC Regulations as follows: All installations falling under the scope of the IPPC Directive shall meet a set of defined basic energy requirements for energy efficiency; based on the implementation of generic, low-cost measures designed to address gross inefficiencies; and All installations falling under the scope of the IPPC directive must meet additional energy efficiency requirements, either through: participation in a Climate Change Agreement or Emissions Trading Scheme Direct Participant Agreement with the UK Government; or compliance with further permit-specific requirements as determined by the Regulator. Action 6.3 We will ensure that planning policy takes into account the potential contribution of microgeneration by: i. carrying out consultations on permitted development rights for microgeneration in domestic and non-domestic properties and bringing relevant legislation into force by April 2011; and ii. working with planning authorities to meet the terms of Section 72 in a way which is consistent with Scottish Planning Policy. We have extended the scope of permitted development rights in planning legislation for domestic microgeneration as required by Section 70 of the Climate Change (Scotland) Act. The Town and Country Planning (General Permitted Development) (Domestic Microgeneration) (Scotland) Amendment Order 2010 provides for free-standing micro-wind turbines and air source heat pumps, which will benefit mainly rural householders. The Amendment Order came into force on 8 March We have also recently consulted on proposals to extend further permitted development rights for microwind turbines and air source heat pumps. This develops areas of policy excluded from the earlier Scottish Statutory Instrument due to the three-month period stipulated in rules regarding notification of the European Commission of changes to technical standards which may affect a market. It is anticipated that a future Order will provide scope for more domestic properties to benefit from permitted development rights for wind turbines and air source heat pumps, including properties in urban areas. Although energy efficiency is widely regarded as the easiest and most cost-effective means of reducing energy consumption and greenhouse gas emissions, it will not deliver alone the emissions reduction targets outlined in the climate change (scotland) Act Microgeneration technologies form an important part of the substantial activity required to make the built environment more energy efficient. 10 integrated pollution prevention and control requires industrial and agricultural activities pollution potential to have a permit. this permit can only be issued if certain environmental conditions are met. 65

72 Conserve and Save: The Energy Efficiency Action Plan for Scotland In addition to the recent extensions for domestic microgeneration (see box above), Section 71 of the Climate Change (Scotland) Act requires Scottish Ministers to make provision for permitted development rights for microgeneration in non-domestic buildings by 1 April We will carry out a full consultation as part of our work to develop the necessary amendment to the existing Town and Country Planning (General Permitted Development) Order Section 72 of the Climate Change (Scotland) Act also requires relevant planning authorities to include in local development plans greenhouse gas emission policies designed to ensure that all new buildings avoid a rising proportion of greenhouse gas emissions through the installation and operation of low and zero-carbon technologies. We will work with planning authorities to identify ways to provide support to meet this requirement in a way that is consistent with Scottish Planning Policy. This recommends that policies for developments involving low and zero carbon generating technologies should accord with the standards, guidance and methodologies provided in building regulations. Scottish Ministers have to lay before Parliament the first annual report on the operation of the requirement by 1 April Action 6.4 We will actively promote microgeneration, most notably by: i. seeking to maximise Feed in Tariff and proposed Renewable Heat Incentive investment in Scotland; ii. supporting the development of a Scottish Microgeneration Certification Scheme (MCS) certification body and exploring other barriers that hinder widespread participation in MCS; iii. publishing a series of online guides on low carbon equipment (see Action 5.4); and iv. our work on skills (see Section C8) and to reduce consumption in the transport network (Action 7.3). GB-wide Clean Energy Cash-back initiatives, such as the Feed-In Tariff (FIT) and the proposed Renewable Heat Incentive (RHI), are intended to drive a step change in the uptake of microgeneration, and we want Scottish consumers and businesses to maximise the benefits of these. Based on UK Government estimates, the FIT, which started 1 April 2010, could stimulate up to 75,000 Scottish installations of smallscale renewable electricity generating technologies (up to 5MW). The proposed RHI is also expected to encourage considerable uptake of renewable heat microgeneration technologies and will contribute substantially to our target that 11% of Scotland s heat demand should come from renewables. With this in mind, our priority going forward is to maximise FIT and RHI investment in microgeneration in Scotland through the actions identified in Renewables Action Plan. We will draw on lessons from the successful Energy Saving Scotland home renewables grants programme and home loans pathfinder scheme, as well as existing research on the barriers and support required for a mass market uptake of these technologies. The FIT requires installers to be accredited under the UK Microgeneration Certification Scheme (MCS). There is a shortage of Scottish installers accredited under this scheme. We are committed to assisting Scottish installers who wish to undergo MCS accreditation and we are currently sponsoring the Construction Licensing Executive (CLE) to become a Scotland-based MCS certification body. We will work with CLE and the microgeneration industry to explore other support that may be required to ensure there are enough suitably skilled and accredited installers to meet expected demand (see Section C8 for related skills activity). 66

73 Conserve and Save: The Energy Efficiency Action Plan for Scotland Action 6.5 Scottish Water will prepare a plan by as to how it intends to promote water conservation and water-use efficiency. Energy is used in purifying water, heating water and treating waste water. Therefore, it is important that water efficiency is integrated to capture all aspects of energy consumption. The Principles of Charging for Water Services , published in October 2009, include actions for Scottish Water to explore on water efficiency and metering. The principles are set by Scottish Ministers and expected to be applied by the Water Industry Commission for Scotland and Scottish Water during the set period. The actions relating to water efficiency and metering are as follows: Scottish Water shall prepare a plan by as to how it intends to promote water conservation and water-use efficiency. Thereafter, it shall update that plan and report on its implementation in its Annual Report. Scottish Water shall, in consultation with the Outputs Monitoring Group, prepare a plan for a metering trial. Scottish Water shall submit the plan to Scottish Ministers for their approval by 31 March As noted in Section C5, the Scottish Government will also consider the impact of water efficiency regulation in building standards and take this into account when reviewing building standards in

74 Conserve and Save: The Energy Efficiency Action Plan for Scotland 68

75 C7. Changing how we use our Transport Systems

76 changing how we use our transport systems Stirling Council employs 4,430 members of staff at three main sites within the city and serves a community of over 86,000 residents. A Staff Travel Survey conducted in 2006 revealed: 11% walked or ran to work 1% cycled 4% used the bus 2% used the train 80% came by car 2% used a council vehicle Though not surprising in an area where many staff live in rural locations not well served by public transport, the high number single occupancy car commutes was identified as a key area to be addressed. The development and implementation of the council s Travel Plan has benefited from partnerships with the Regional Transport Partnership TACTRAN, of which the Council is a member, and input from the Energy Saving Trust in Scotland. A number of measures have now been successfully implemented: A Travel Plan Officer post has been created A car-share scheme has been promoted - StirlingLiftshare (external site) 8 pool bikes and accessories have been purchased A Bike mileage allowance has been set at 20p per mile A Cycle to Work Scheme for assisted cycle purchases has been introduced Cycle parking, clothes lockers and showers are available at main sites and are being extended. Promotion of lunchtime power and leisure walks for staff A Staff Travel Guide is available on the council intranet The majority of essential car users allowances have been removed through the Single Status Review 53 pool vehicles have been provided for staff In addition a new Park and Ride service directly serves 2 of the 3 main council sites. The council is also currently working towards a Cycle Friendly Employer Award. The provision of pool vehicles and bikes has helped minimise the need to take the car to work and has enabled staff to consider more sustainable modes for commuting to work and for journeys undertaken while at work. Further emissions reductions for at-work travel have been achieved through the use of lower emission vehicles. A pilot programme to provide Personal Travel Plans is currently being undertaken with 35 members of staff to inform the development of further Travel Plan measures. Well received by staff, the council s Travel Plan is still in its infancy. However, the uptake of cycling provisions in particular has meant that existing cycle storage is now fully utilised, leading to the installation a new storage area for 20 bikes.

77 C7. Changing how we use our Transport Systems We will create an energy and fuel efficient transport system as part of our drive towards a low carbon future for Scotland. As outlined in the consultation paper, transport is a major contributor to scottish energy demand and greenhouse gas emissions. emissions from transport, both in absolute terms and as a share of scottish emissions, are increasing. in 2007, 15 megatonnes of carbon from transport entered the atmosphere. if we are to meet the statutory targets set out in climate change (scotland) Act 2009, and make significant progress towards the decarbonisation of road transport by 2030, we must start to reduce our transport energy demand now. While the major policy levers to reduce transport emissions and energy consumption rest with the eu and the UK government, commissioned research has identified a series of devolved policy options available to scottish Ministers. these are grouped under three key headings: i. Reducing the need to travel: using scottish planning policy to influence the location, density and form of development to make it easier to access by public transport and active travel, and piloting community hubs in more rural areas in order to reduce the distances people need to travel; ii. Wideningtravelchoices to encourage lower carbon options: travel planning for schools, households and businesses; considering the potential of parking management; improved cycling and walking infrastructure; car clubs; and improved, lower emission local buses; iii. Encouragingenergyefficientdrivingforremainingroadjourneysandreducingenergyconsumption inourmanagementofthetransportnetwork: including eco-driving; low carbon vehicle infrastructure and procurement; and active traffic management on trunk roads. Action 7.1 We will seek to reduce the need to travel, in particular through further analysis of the community-hub concept in order to test issues of planning, likely demand, community and business engagement, and value for money. Multi-use shared facilities in rural and small urban areas could prove effective in reducing the need for travel to our larger towns and cities by locating services, and potentially tele-working office facilities with video-conferencing suites and digital or broadband access, within communities. Additionally, community hubs might include services such as health, education, shopping delivery, post office and other financial services. Scottish Planning Policy specifies that opportunities for personal travel should be prioritised in the following order - walking, cycling, public transport, car and other motorised vehicles. Buildings and facilities should be accessible on foot and by cycle. Improvements to active transport networks, such as paths and cycle routes, should make them more attractive and safer for pedestrians and cyclists, including people with mobility difficulties, thereby supporting more sustainable travel choices. The availability of parking can have an important influence on car use. Planning authorities should apply best practice parking standards to on-site parking at new developments to encourage modal shift. Parking restraint policies should be supported by measures to promote the availability of high quality public transport services. Planning authorities should also consider promoting Park and Ride schemes on commuter routes. Appropriate car and cycle parking should be provided at rail stations to encourage onward travel by rail. 71

78 Action 7.2 We will extend travel choices to include more sustainable transport options through: i. supporting more active travel - implementing the Cycling Action Plan to achieve our vision of 10% of all journeys being by bike in 2020 and supporting this with additional funds this financial year; ii. widespread travel planning, including a range of measures to encourage its use and improve its impact in organisations and schools. For households we will review the Scottish-based Smarter Choices, Smarter Places demonstration programme, following the current tranche of work, and use the lessons learned to work with COSLA, Regional Transport Partnerships and Local Authorities to consider how best to deliver Personal Travel Planning post-2011; iii. management of car parking and road space - working with COSLA, Local Authorities, and business organisations to consider potential policies relating to parking management, and examining any legislative requirements; iv. working with Local Authorities to increase the number of car clubs in Scotland and explore innovative funding packages that may support new car clubs; v. supporting the bus industry in adopting low carbon buses; vi. continuing to promote modal shift to rail and more efficient rail services; and vii. continuing to promote the benefits of high speed rail as a long-term infrastructure investment. Supporting More Active Travel A higher proportion of walking and cycling instead of car driving can substantially reduce our use of energy resources. the recently published Cycling Action Plan for Scotland lays out the scottish government s commitments to cycling and aims to increase the modal share for bikes from 1% to 10% by in we will invest a total 17.3 million in cycling. our focus on active travel will require ambitious changes, including to infrastructure in order to enhance the safety and driver awareness of cyclists and pedestrians. All drivers and cyclists should respect an appropriate hierarchy of all other road users needs in towns and cities. traffic volumes and speeds should be considered where they represent a detrimental effect on active travel opportunities. road space reallocation for active travel will be essential if scotland is to change how it uses its road network. Personal and Organisational Travel Plans We also fund the energy saving trust to provide free travel plans tailored to organisations individual needs. organisations with more than 50 employees and/or 10,000 visitors per year may be entitled to free travel plan advice from an experienced consultant. smaller organisations can receive free advice by telephone. the recently announced cycle friendly employers loan scheme for the private and third sector allows organisations who sign up to the scheme access to loans of up to 10,000 from the energy saving trust for workplace cycling facilities. school travel plans outline ways to reduce car use (e.g. escort journeys by parents and commuting by staff) and to increase levels of active travel and public transport. As well as reducing car use and rushhour congestion, reduction in traffic around schools lessens air pollution and safety risks and makes active travel more attractive. school travel co-ordinators were funded directly by scottish government until , when the funding was rolled into the general local government settlement. sustrans continues to receive scottish government grant funding to support school travel planning through both advice and the provision of infrastructure to support active travel. personal travel planning (ptp) seeks to provide carefully targeted information and assistance to individuals and households in the expectation that it will encourage a voluntary shift in their travel behaviour 72

79 towards sustainable modes and away from car driving. it encourages people to switch to cycling, walking or public transport, where appropriate, by raising awareness of these options and discussing how to overcome actual or perceived barriers. car sharing, and buying vehicles that are best in class can also be encouraged, and information can be delivered to travellers direct through schools, universities and colleges, workplaces or households. ptp features in three of the seven smarter choices smarter places community demonstration projects in scotland. together with department for transport results from england in february 2010, which showed a reduction in car journeys per person of 9%, the early lessons from these projects provide a foundation upon which to deliver ptp in future. Smarter Choices Smarter Places The Scottish Government and COSLA are currently undertaking the Smarter Choices, Smarter Places (SCSP) demonstration programme in seven communities throughout Scotland, all of which involve elements of travel planning. Five of these Kirkwall, Larbert and Stenhousemuir, Barrhead, Dundee and Dumfries - included Personal Travel Planning for the public during the summers of 2009 and 2010, with total funding of 1.7 million for 40,000 households. Early lessons and experience from summer 2009 visits suggest that: a strong, highly visible, and widely promoted community-wide marketing campaign is important to support PTP; travel advisers experienced overwhelmingly positive responses at the doorstep from the public; negative reactions were rare; and a successful PTP method in one area may not necessarily transfer with the same success to another area. Parking Management Workplace parking levies, public parking charges and residential parking charges provide mechanisms to complement and improve the effectiveness of other policies that seek to reduce car use, such as workplace travel planning. however, they can be controversial, particularly where alternatives, such as public transport, are perceived to be inadequate. Car Clubs car clubs present a key opportunity to reduce car ownership, and hence car use and fuel consumption, by offering simple and cost-effective access to a locally-based car for personal or business use. the cars are available locally, maintained by the club, and club users can book in advance and use any vehicle within the same scheme. there is clear potential for car clubs in towns with populations over 25,000 and we are also considering the best mechanisms to facilitate car clubs in towns and communities with smaller populations. larger public and private sector organisations might have an important role to play in the development of car clubs within their localities by considering their potential to reduce the size of corporate fleets. Edinburgh and Glasgow City Car Clubs Car clubs are known to reduce car ownership among members, as well as reduce the number of miles they travel by car. In Edinburgh, City Car Club operates a highly successful car club with about 4000 members and a fleet of 100 cars conveniently located in and around the city centre and beyond. Glasgow City Council has announced that the city s official Car Club will be launched in September Every car in the Glasgow City Car Club will boast CO 2 emissions of less than 100g/km. City Car Club cars are available 24 hours a day, 7 days a week and can be booked by the hour, day or as long as members want. The cars are conveniently located in designated parking bays near to where members live and work and can be booked online or by phone in advance, or at the last minute. City Car Club take care of insurance, tax, servicing, parking permits and cleaning. 73

80 in addition, car clubs can provide a way to alleviate the demand for car ownership in areas with low existing car ownership, e.g. in glasgow s east end where the ownership ratio of 0.33 cars/household is coupled with a high desire to drive. car clubs might adopt and encourage further take up of low carbon vehicles, although issues remain around their current high cost and comparative range. Buses the Bus service operators grant (Bsog) is a discretionary grant paid to bus operators that principally aims to benefit passengers by helping keep fares down and enabling services to run that might not otherwise be commercially viable. the budget is set at 66.5 million for 2010/11, and includes a payment incentive for low carbon vehicles set at twice the conventional rate per vehicle. We Green Bus Fund We are investing 3.3 million in 2010/11 to incentivise the purchase of low carbon buses by funding the difference in costs between a low carbon vehicle and its diesel equivalent. The benefits include reduced fuel consumption and emissions, and improved local air quality. are currently reviewing the Bsog scheme in order to align it more closely with the government s strategic priorities of sustainable economic growth and climate change. Rail Investment scottish government policy supports modal shift of passengers and freight to rail through investment to boost service frequency, quality and journey times. investment targets the upgrade of passenger rolling stock and increased track capacity and capability. commitment has also been made to delivering rail enhancements in the east of scotland; rail service enhancements between Aberdeen and the central Belt; and rail enhancements between inverclyde/ Ayrshire and glasgow. The Scottish Transport Projects Review has identified as investment priorities for Scotland: the Edinburgh to Glasgow Improvements Programme (EGIP) to improve the capacity, frequency and journey time of rail services between Edinburgh and Glasgow. Construction has started and the project is expected to be delivered by 2016 at an estimated cost of 500 million- 1 billion. It will result in significant carbon emission reductions through the electrification of approx 360 km of single track; enhancements on the Highland Main Line between Perth and Inverness to improve service frequency, journey time and freight capacity. The first phase, which is focused on service frequency and journey times, is expected to be delivered by December 2011; and enhancements between Aberdeen and Inverness to deliver an increase in service frequency, a reduction in journey time, extra rail services, a new station at Dalcross and the possibility of a station at Kintore. This is at an early stage of feasibility and expected to be delivered by 2016 at an estimated cost of million. 74

81 High Speed Rail International experience shows that high speed rail dominates the travel market on journeys between 400 and 450 miles. In March 2009, the UK Government set out its commitment for a high speed rail line from London to the West Midlands by 2026, with extensions to Manchester and Leeds to follow. A connection to Scotland has been suggested for a later phase, but does not form part of the initial commitment. These plans are currently under review by the new UK Government. high speed rail is a fast, reliable and sustainable mode of transport that makes rail an attractive choice for passengers. it is expected to encourage a shift away from domestic aviation and help us towards our climate change objectives. scottish Ministers have made it clear that scotland is central to the business case for high speed rail. successive reports show that the economic and environmental case for high speed rail in the UK is significantly stronger when it includes an extension to scotland. 11 high speed rail could bring economic benefits worth 20 billion to scotland, mainly due to reduced journey times. A further 5 billion of wider economic benefits would be realised through jobs being created in areas close to the line and agglomeration, i.e. the productivity benefits that some firms derive from being closer to others, thereby improving their supply chains and gaining access to larger labour markets. We plan to work closely with UK Ministers and the department for transport over the coming years to ensure scotland s connection to a UK high speed rail network. Action 7.3 network by: We will encourage more efficient driving and reduce energy consumption in the transport i. working with industry and motoring and freight organisations to establish how the driver training market can best deliver eco-driving training to improve vehicle efficiencies and reduce fuel consumption; ii. reducing carbon from the Scottish vehicle fleet by raising awareness of available UK funding support for Low Carbon Vehicles (LCVs) and building on this with specific Scottish interventions, e.g. encouraging the public sector to show leadership through the visible procurement of LCVs and the required infrastructure; iii. seeking to improve the operational efficiency of our trunk road network through the deployment of Intelligent Transport Systems; iv. continuing to operate the trunk road and motorway network in the most efficient manner and seeking to reduce energy consumption by roadside electrical equipment; and v. continuing to support the rail industry in developing emission reduction techniques. Eco Driving experience has shown that simple steps such as driving at optimum speeds, changing gear at the optimal times, maintaining tyre pressures at optimum levels and avoiding idling can reduce fossil fuel use and emissions by 10%. With such demonstrable benefits to drivers, there should be significant market opportunities for providers of training to drivers of private, fleet and freight vehicles. the energy saving trust is supported by the scottish government and provides information, advice and simulator-based training to educate drivers in the benefits of eco-driving through its network of area advice centres (essacs). 11 see British chambers of commerce, high speed, high time: the Business case for high speed rail, november 2009, and greengauge, fast forward report, september the speed of a high speed rail connection between scotland and london will be crucial: journey times of 3 hours would allow high speed rail to capture 67% of the travel market; a time of 2½ hours would increase that to 80% (see 75

82 Low Carbon Vehicles (LCVs) We will seek to encourage demand for lcvs and their requisite charging/refuelling infrastructure in scotland. We have consulted on the proposed twin overarching targets of a 100% low carbon public sector fleet by 2020 and for 95% of all new private sector vehicles purchased that year being low carbon. We are currently developing our lcv action plan. We also intend to build on existing and planned UK government funded schemes. these include plugged in places, the technology strategy Board s ultra low carbon vehicle demonstration scheme, the cenex procurement pilot, and a lcv subsidy scheme, which will be open to the public in these are all accessible to scotland. As part of the 2010 UK consequentials budget, we have committed 4.3 million to lcvs and their supporting infrastructure. these funds will be used to encourage the uptake of a range of lcv technologies, through the low carbon Vehicle procurement scheme. 3.6 million from this scheme will be administered through community planning partnerships, which will make funds available to a range of public sector bodies to cover the difference in costs between a lcv and its conventionally powered equivalent. the scheme will also support the installation of lcv refuelling infrastructure. transport scotland is working with a range of public and private sector partners to develop a scottish bid for funding through the UK plugged-in places electric vehicle infrastructure scheme. if successful, this proposal would see a critical mass of infrastructure placed throughout central and southern scotland. interested parties have until the end of october to join this bid and take advantage of the match funding that a successful bid would unlock through the UK office for low emission Vehicles. in addition, transport scotland s sustainable transport team will lead a microrenewables project that will use photovoltaic panels to generate power to charge electric vehicles and supply surplus power to the national grid. A pilot charging scheme will be trialled in glasgow to field test theoretical energy generation models in an environment where sunshine is at a premium and operating temperatures can have a significant influence on the ability of electric vehicles to charge. the learning from the project will help inform future research and development. Freight the freight Best practice programme offers a range of free material to help road freight managers and drivers improve their vehicle efficiencies. guides, case studies, software and seminars are available on topics such as saving fuel, skills, equipment and systems, operational efficiency and performance management. seven scotland-specific case studies and three pocket guides (covering urban driving, efficient customer deliveries and bad weather driving) have been produced to date. they are available on We will continue to work in partnership with business and industry to increase fuel efficiencies, encourage the efficient movement of goods through the supply chain, and consider modal shift from road to rail or water where this is viable. Intelligent Transport Systems As outlined in project 9 of the Strategic Transport Projects Review (sptr, 2008), the use of intelligent transport systems (its) will improve the operational efficiency of our trunk road network. stpr project 9 includes the application of measures such as hard shoulder running, variable speed limits, ramp metering and average speed enforcement. the deployment of these measures on the most congested parts of the trunk road network will improve safety and journey time reliability, and in some cases result in journey time savings. smoother traffic flows can also result in reduced fuel consumption and emissions per vehicle. 76

83 Reducing energy consumption in the transport network some of our existing roadside assets, for example trunk road lighting, consume high levels of electricity. transport scotland has been testing new technologies to reduce levels of energy consumption and will develop a detailed plan to reduce our roadside energy consumption. this is expected to utilise a wide range of approaches, including use of energy efficient equipment and sustainable sourcing. for example, a study will be undertaken this year into the use of micro hydro-generation to meet the energy required for some of our roadside assets. this technology uses micro-turbines placed in open, running water courses to generate energy and provide an alternative to connecting to the national grid in remote areas. the trial will ascertain if the technology is suitable for roll out on the rest of the transport scotland trunk road network. Traffic Scotland ( continues to ensure that the trunk road and motorway network operates in the most efficient manner through improved monitoring, enhanced control measures and the extensive distribution of information to travellers. Freight Scotland ( provides a similar service for the freight haulage industry. transport scotland is supporting the rail industry s implementation of the technical, engineering and operational measures identified in the Sustainable Rail Programme. this includes maximising energy efficiency for powering trains and the energy used on stations. We will influence the development of emission reduction techniques on the rail network and work with industry partners to embed the 10 sustainable development principles identified to be fundamental to delivering a sustainable railway. to help the rail industry better understand how it can source and reduce its station and depot energy requirements, a feasibility study is being undertaken by scotrail into the use of photovoltaic and wind power generation. depending on the results of the study, it is anticipated that this form of microrenewable technology could be installed at selected stations in early

84 Conserve and Save: The Energy Efficiency Action Plan for Scotland 78

85 C8. Developing the Skills for Energy Efficiency

86 skills Our huge renewables potential means Scotland will be at the forefront of the green energy revolution, bringing tremendous opportunities for people to work in this high profile industry. Working in renewables will not only give you an exciting and varied career, you ll be helping our economic recovery and helping to save the planet. Jim Mather MSP The expected growth of the renewables sector in Scotland, as highlighted by the Scottish Government, has brought with it a wealth of job opportunities, many of them in areas which were virtually non-existent a decade ago. At present, there are around 80,000 green jobs in Scotland and this is expected to increase by 50,000 over the next 10 to 15 years in industries such as recycling, conservation and renewable energy. Many people may associate green jobs with working on wind farms but it also includes many other professions. Examples of jobs available include engineers, plumbers, wind turbine technicians, boiler maintenance technicians, electricians, welders, wind analysts and solar panel a forest ranger, ecological surveyor and heat pump installers.

87 C8. Developing the Skills for Energy Efficiency In making the most of the new opportunities presented by energy efficiency, we will ensure that our training and education systems are ready and capable to develop the required skills and knowledge so that as many people as possible take up the openings in employment. the improvements outlined in energy efficiency and renewable heat in scotland over the next decade mean that new jobs requiring a skilled workforce will be created in sectors where there is opportunity to develop and gain competitive advantage. tens-of-thousands of new direct and indirect jobs could be created nationally in high-value adding sectors, with the potential to deliver significant, environmentally beneficial impacts, including in energy efficiency and microgeneration. these will be mainly in retrofitting existing buildings, with additional employment likely to result from the associated manufacturing, operation, maintenance, and energy management activities. the level of skills demanded is also likely to increase, including in: design and construction - in relation to energy and water efficient buildings and infrastructure; renovations and retrofits; and the installation and maintenance of efficient appliances and machinery and microgeneration technologies; restructuring the energy system and the expansion of combined heat and power, renewable energy, and heat networks; and developing alternative transport systems. The Scottish Government s Skills Strategy refresh, published October 2010, sets out Skills Development Scotland s (SDS) overall approach to supporting the Government Economic Strategy Key Sectors, including energy. The ambition is to deliver a skills system that is fully aligned with the future growth objectives of key sectors, addressing the demographic profiles within the current workforce and anticipating the future skill challenges which new technologies and business growth opportunities will present. chapter 11 of the Conserve and Save consultation document outlined the likely job opportunities created through energy efficiency, including through the business and housing supply chains. it summarised the relevant skills and knowledge requirements, the existing skills landscape, including groups and current issues, and the action already underway. We now need to prepare the skills to deliver these jobs and the required improvements in energy efficiency and microgeneration. this will both help to meet scotland s challenging climate change targets and keep our workforce competitive in the low carbon economy. Action 8.1 We will assess the energy efficiency skills demand and current activity by: i. undertaking a programme of work to draw on existing labour market information from Sector Skills Council and Scottish Government surveys; ii. assessing the skills implications of this predicted demand in terms of: i) numbers of employees affected; and ii) the level of engagement required to support energy efficiency in Scotland; and iii. working with Sector Skills Councils and other industry bodies to undertake an assessment of current and planned training provision with an energy efficiency emphasis. in taking forward our work on skills, it is crucial that we first assess the necessary demand, as skills and training interventions can only be effectively planned once the demand is accurately understood. We have begun to gauge the numbers and types of new jobs that will be required with a significant impact on energy efficiency and microgeneration, as well as the number of employees in the current workforce who will need to upskill or to develop a broader skills base. however, there is a range of job estimates from different sources which are inconsistent and vary widely. We need to develop an agreed consensus on the methodologies for determining current and future employment figures and occupational profiles of the jobs growth. 81

88 We will firstly build on existing research findings that suggest skills/knowledge gaps in relation to energy efficiency, with a view to commissioning and undertaking a discrete study. this will help to gain consensus and to articulate present and future employer demand for energy efficiency skills and qualifications, providing a clear understanding of the skills and knowledge demanded by industry. We will then assess the skills implications of this predicted demand in terms of the numbers of employees affected and the level of engagement required to support them. this will build on the work being undertaken by skills development scotland (sds) for the wider energy sector on behalf of the energy Advisory Board. it will involve mapping future skills requirements and assessing the gaps in the energy efficiency skills base. it will take into account: a. the increase in overall numbers of jobs and what new jobs will be required; b. the numbers and types of existing jobs that will need broader skills sets; c. the numbers and types of existing jobs that will require upskilling in order to keep pace with changing technology. Before we plan any new interventions, it will be important to review all current and planned training that has an energy efficiency emphasis. our proposed assessment will take in the breadth of existing training bodies and SDS s work with the Scottish Energy Advisory Board highlights the significant employment growth and skill requirements within the low carbon economy. European Social Funding has assisted SDS to create a Low Carbon Skills Fund which will enable employers to access sector specific training to help the adoption of processes around carbon reduction and energy efficiency. It specifically includes skills enhancement programmes in areas such as Wind Turbine Maintenance and the up-skilling of existing craft level employees to support the installation of Microgeneration systems. include colleges, universities and private training providers. it will help to identify the training content required to respond to future energy efficiency challenges, possible supply-side barriers, and current and potential capacity to deliver on existing and future energy efficiency investments. Action 8.2 We will strengthen our links with the skills work carried out by the UK Department for Energy and Climate Change (DECC) and its Green Deal skills project, tying in with the Energy Efficiency Partnership for Homes skills work group. it is important that we do not work in isolation in planning energy efficiency. in addition to working with partner organisations such as the energy saving trust, we will link into the activities that support decc s green deal skills work. this includes involvement in the decc-funded energy efficiency partnership for homes project, which is investigating the skills required to deliver the green deal, and any future projects or fora initiated by decc to support UK businesses in preparing for green deal. By getting involved, we will assess the implications of their work for scotland and engage to influence the broader agenda. Action 8.3 We will establish a delivery-focused skills group, made up of key partners, to agree a framework for taking forward energy efficiency and microgeneration skills activity. once the skills demand and current provision have been assessed, we will establish a delivery-focused skills group that includes all relevant partners to consider future skills interventions. this group will drive the engagement of all appropriate partners within the skills sector and ensure links with other strands of energy skills work. i0t will compliment and align with the newly established forum for renewable energy (freds) skills group. Using the information gathered on skills demand, skills implications and existing training provision, the skills group will develop and oversee the implementation of a skills framework that outlines the specific energy efficiency training interventions required. it will determine what new interventions will be 82

89 required when, how these will be delivered, and then progress them as funding becomes available. its work will include: i. investigating the mechanisms for agencies to work together to develop the required training interventions; ii working with sscs and Awarding Bodies to facilitate the development of national occupational standards (nos) or qualifications within scottish credit and Qualifications framework (scqf); iii. ensuring that energy efficiency skills are fully taken into account in future sg and sds skills and fe / he strategies; iv. investigating the funding implications of the action outlined in the skills framework; and v. at a later point, developing a map to help employers and individuals negotiate the training landscape for energy efficiency as part of the planned sds energy skills gateway. SELECT s recently established Scottish Environmental Technologies Training Centre provides a state-of-theart training environment for teaching electricians, heating engineers and plumbers the latest developments in energy-saving technology. The centre, facilitated and supported by Vaillant and SDS, works to skill sets defined by SummitSkills and is approved by the Scottish Qualification Authority. Training is offered for up to 1000 qualified tradesmen per year to acquire installation skills for solar water heating panels, photo-voltaic panels, ground and air-source heat panels. Action 8.4 We will raise business awareness of the skills implications of forthcoming regulations and requirements, demonstrating clear demand and the need to invest in skills. in all of this, it will be important to communicate clearly with business, ensuring that it is aware of the implications of the drive towards energy efficiency, both in terms of the work opportunities and the skills that will be required to fulfil these. in particular, it will be important to work with energy suppliers as a matter of priority to ensure that opportunities arising from future energy supplier/company obligations, are maximised across scotland. We will do this through the development and dissemination of information advice and guidance, assisted by our business advisory service for energy efficiency, the sscs through field-based and call centre staff, and a series of dissemination events undertaken by stakeholders. Action 8.5 We will actively promote the development of skills and innovation in energy efficiency for the design and construction sector by: i. developing low-carbon and sustainable industries and disseminating good practice through projects such as Scotland s Housing Expo 2010; ii. supporting industry in achieving energy efficient solutions through initiatives such as the Scottish Sustainable Communities Initiative Design Competition. scotland s housing expo 2010 ran throughout August in inverness and showcased a range of energy efficient buildings, many of which employed passive energy measures through innovation in design and construction. the scottish sustainable communities initiative (ssci) design competition at Whitecross, near linlithgow, is a development of one of the SSCI exemplar projects which aim to promote innovative, very low carbon communities. the competition has built on the experience of the housing expo. five design/developer teams have been shortlisted and will be submitting proposals for innovative, sustainable housing for the site, with the winning proposal announced in october such initiatives promote knowledge of the skills required and help to develop good practice. 83

90 Conserve and Save: The Energy Efficiency Action Plan for Scotland 84

91 C9. Financing Energy Efficiency

92 Finance The Energy Saving Scotland small business loans scheme has helped businesses in Scotland reduce their carbon footprint and save on their energy costs. One company which received assistance through the initiative is the Rob Roy Hotel. The Rob Roy Hotel is one of the west of Scotland s best known small hotels. and is a popular stopover for tourists. Its proximity to Loch Lomond and the Trossachs National Park also means that the hotel s owner, Mike Anderson, is conscious of the impact that the business is making on the environment. And thanks to the Energy Saving Scotland small business loans scheme, Mike is managing to make improvements that are helping the Rob Roy Hotel not only improve its energy efficiency but also develop as a business. The programme is funded by the Scottish Government and delivered by the Energy Saving Trust. The scheme offers small to medium-sized enterprises across Scotland interest free loans to help their business install measures that reduce energy consumption or to install renewable energy technologies. In most cases, investment can be set against capital allowances. Loans are available from as little as 1,000 up to a maximum of 100,000. A business advisor from the local Energy Saving Scotland advice centre will visit interested premises and identify the main energy saving opportunities to help reduce not only the carbon footprint, but also costs. The report can be used to support an application to the Energy Saving Scotland small business loans scheme. After our assessment was carried out, we looked at the report and we decided to act on our lighting and glazing, says Mike. We decided to replace every single light bulb in the hotel with energy saving light bulbs and our interest free loan also covered the cost of fitting double glazing to our public rooms. Mike estimates that the changes are saving the business around 10 to 15 per cent on its energy costs. These savings are just one of the benefits that Mike has identified. We re benefiting from the added value the scheme offers, says Mike. The upgrades are helping us achieve our business target of moving from a two star to a three star hotel.

93 C9. Financing Energy Efficiency We will pursue our work on financing energy efficiency on three fronts: i. making the case for spending on energy efficiency in future budgeting decisions as part of our broader climate change and economic agendas; ii. seeking to maximise the contribution that other public funding, e.g. from Europe, can make; and iii. exploring new finance mechanisms. energy efficiency is recognised as having the potential to be the simplest and most cost-effective way of meeting climate change requirements. government funding for energy efficiency, at both UK and scottish levels, is already substantial. however, there are further projects for which finance still has to be identified, and the necessary work to promote energy efficiency across all sectors clearly cannot be funded by government on its own, especially during a time of overall budget restrictions. therefore, as we move forward, we will investigate all possible finance and funding mechanisms for implementing energy efficiency programmes in scotland. in doing so, we will i) link into wider scottish government work on low carbon, renewable energy, and climate change finance mechanisms; and ii) consider activity specific to the energy efficiency Action plan, including finance mechanisms for domestic, commercial and public sector buildings, and low/zero carbon district heating. Government Funding for Energy Efficiency The UK Carbon Emissions Reduction Target (CERT) is the main mechanism for providing home energy efficiency improvements in Scotland. As detailed in the consultation paper, it could be worth over 300 million for the period We are working with energy companies to help leverage a proportionate share of their supplier obligation for Scotland. The Scottish Government seeks to complement such funding by providing direct support. This includes, as detailed throughout this plan, 25 million this financial year for area-based home insulation schemes; a target of 2 million of energy efficiency loans to SMEs in ; the recent pilot of energy efficiency loans for householders worth over 2 million; 1.1 million this year for the Energy Efficiency Design Awards, to drive forward innovative energy saving solutions; 13.5 million this year for community renewables and microgeneration; revolving loans through the Central Energy Efficiency Fund (CEEF), worth 20 million for public sector bodies; an additional 4 million in interest free loans for Further and Higher Education institutions, delivered through Salix Finance; and up to 10 million this financial year for the Energy Saving Trust and Carbon Trust to deliver advice and guidance across all sectors. In addition, there are potential benefits from the Energy Assistance package (with a core budget of 45.9 million this year from Scottish Government, plus CERT funding from the major energy supply companies), and the Climate Challenge Fund, worth 27.4 million for Since publishing the consultation paper, we have run a successful home loans pilot and extended the home insulation scheme. We have also run a 2 million Scottish boiler scrappage scheme. In addition, this plan identifies further programmes that will receive funding, such as the VIBES award for energy efficiency, pilots that will promote energy efficiency in traditional buildings, microgeneration projects in transport, and work to asses the skills demand and its implications. Action 9.1 We will ensure appropriate Scottish Government funding for energy efficiency activity, based on the contribution that this can make to our climate change targets and economic development. in view of scotland s highly ambitious climate change targets, coupled with current budget constraints, we will look to direct our resources so that they have maximum leverage. the 2011/12 draft scottish Budget will be published in mid november in preparing for this and any other possible funding, we will consider, for example in housing, how we target government spend on the most needy and how 87

94 we provide financing for social housing providers. We will also consider how the various groups of householders should be supported and encouraged: for example, low-income householders through the energy Assistance package; low-income, but asset-rich, private householders through mechanisms that release equity where appropriate; and medium-income households through prioritising borrowing to make energy efficiency (and future financial) savings. in addition, we will develop the menu of key programmes that we will seek to fund as monies become available. this might include, for example, increasing scottish government funding to expand sme loans in scotland and aggressively market these to scottish businesses. it could include pilots to improve energy efficiency in traditionally constructed housing, including hard-to-treat pre-1919 stock, or work to develop local heat networks. Interest free loans, such as those provided by the Energy Saving Trust and Carbon Trust, have proven to be a highly cost-effective way to deliver energy efficiency savings in small and medium sized enterprises (SMEs). They are designed so that anticipated energy savings offset the recipient s loan repayments, new equipment pays for itself, and businesses continue to make savings year-on-year, increasing their potential for future business success and growth. More SME loans in the market would also increase demand for the services of the approved suppliers of optimal energy efficient equipment and technology. Action 9.2 We will actively engage with UK and EU funding policy for energy efficiency, with a view to maximising the value of UK, EU and other international funding in Scotland. As we look how to finance the growing demand for energy efficiency, we will also investigate the potential for unlocking other domestic and international sources of funding for energy efficiency. this will draw on existing research on domestic loans schemes, for example, and consider existing eu, UK and scottish schemes and loans. At a UK level, we will link into decc s UK energy security and green economy Bill proposals for green deal finance. these build upon the pilot 4m pay As you save (pays) scheme that tests new ways to finance whole house energy makeovers. the UK government is currently progressing proposals for green deal finance, with scottish government input so that these can be designed to meet scottish circumstances. since the green deal s market driven approach may encompass escos (energy savings companies), we will consider relevant funding mechanisms for housing, such as funds available through the european investment Bank, once the UK energy security and green economy Bill has been laid before the UK parliament later this year and proposals are known more fully. in addition, we will consider examples of good practice, such as london s Buildings energy efficiency programme (Beep) to retrofit buildings, and the london green fund. We will consider work to help support community enterprises and social business, and any possibilities to fund specific energy efficiency technology development and deployment, for example investigating whether any technology companies might be eligible for rsa. looking to europe, we will consider schemes such as: the JESSICA Fund - financing sustainable development for urban areas; erdf and esf funding, e.g. for innovative heat networks or skills programmes; implementation of the european commission s strategy energy technology plan (SET-Plan) to finance low carbon technologies and the possibility of a scottish city participating in the smart cities initiative, which includes 11 for energy efficiency; and the potential eib proposal to set up a loan scheme for microgeneration to retrofit social housing. 88

95 As an example, the scottish government and the new scottish green energy centre (segec) are working with partner bodies in the eu-supported lowland and Uplands scotland (lups) and highlands and islands structural funds programmes to seek ways for such programmes to support energy efficiency more strongly than in the past. the programme Monitoring committee has now agreed that the balance of funds within priority 1 erdf (lups) will focus on the scottish innovation low carbon fund (silc), supporting individual enterprises and collaboration between industry, academia & the public sector to deliver innovative low carbon technology demonstration projects. Working closely with the european commission, we have also secured agreement to widen the eligibility scope of erdf priority 3 (lups) (urban regeneration) to give greater importance to energy efficiency, district heating and low carbon technologies, i.e. to include: energy efficiency measures in housing; support for energy production from renewable energy and low carbon technologies in response to local energy needs, e.g. co-generation and distribution energy systems such as district heating and chp projects; projects that support clean and sustainable public transport, if part of integrated urban development plan; and support for schemes that pilot or demonstrate new or innovative approaches to energy efficiency retrofit measures, in particular targeting the retrofit of existing social housing stock. The Scottish European Green Energy Centre (SEGEC, is an independent, not-for-profit organisation, designed to support Scottish engagement in European activity and the development of collaborative projects to accelerate the deployment of sustainable energy technologies. Based in Aberdeen, SEGEC works to enhance capacity within the academic and business sector to deliver sustainable energy research, commercialisation and deployment projects which have a wider impact on the Scottish economy. It is sponsored by Scottish Government, Scottish Enterprise, Highlands and Islands Enterprise, Scottish Power, and Scottish and Southern Energy, and part funded by the European Regional Development Fund through Scottish ERDF Programmes for We have also responded to the commission s consultation on future financing to 2020 to stress the importance of giving the promotion of the low carbon economy a much higher priority in future funding programmes. Action 9.3 We will investigate new and further funding options for implementing energy efficiency programmes, working closely with the Scottish Low Carbon Investment Project, the 2020 Group, and other appropriate groups to investigate alternative funding models. looking beyond the public purse as a source of funding for activity that requires significant additional resource, the scottish government and partner organisations have started work under the banner of the scottish low carbon investment project. this covers the areas of low carbon electricity, heat, energy efficiency and transport, and looks beyond ongoing or forecast investment activity to identify the range of available opportunities for international investment. the project looks to: assess the low carbon investment opportunities across private and public sectors scotland-wide; assess the supply of related capital and of the appetite for investment in scottish projects within the international investment community; and focus the 2011 low carbon investment conference on resource use and energy efficiency, building on the momentum established by the inaugural investment conference in september

96 in the 2010 Budget, the UK government announced the creation of a 2 billion green investment Bank which will have a mandate to invest in the low-carbon sector. the UK government will initially invest up to 1 billion from the sale of mature, government-owned infrastructure-related assets and will seek to match this with at least 1 billion of private sector investment. We will look to ensure that scotland receives its fair share of this investment as part of our wider work on low carbon investment. to complement these, the 2020 Delivery Group has established a finance sub-group, which has as its mission to create the best environment possible for innovative financial schemes to support the delivery of a 42% reduction in carbon emissions by the sub-group has proposed three streams of work which will, among other things: research the effectiveness of current finance options and the barriers in place to financing climate change action in scotland; look at options for change, identifying gaps and weaknesses in present finance provision and proposing solutions; and prompt debate and gain consensus on aligning finance provision to scotland s carbon ambitions, identifying new finance models or incentive schemes to expedite carbon reduction programmes; and how finance can best be targeted to create the biggest impact. We will seek to feed into this group and to draw upon its expertise and advice. We will also consider funding models from other countries, such as the german Kreditanstalt fuer Wiederaufbau (KfW). 90

97 C10. Taking Energy Efficiency Forward

98 C10. Taking Energy Efficiency Forward We will seek to drive forward energy efficiency through our partnerships within Scotland and our national and international engagement, using these to promote and learn from best practice. As is clear from throughout this plan, we need to achieve a step change in our levels of energy efficiency and to take advantage of the environmental and economic opportunities in reducing consumption and developing environmental clean technologies. Achieving our ambitious climate change targets will require action from across society, including central and local government, business and industry, communities and individuals. given the global implications of climate change and the scale of effort required worldwide, we also need to work with our partners at a UK and european level and beyond. Action 10.1 Within Scotland, we will provide leadership and develop strong partnerships to help share best practice and ensure that everybody plays their part in driving forward energy efficiency. We want every person and business in scotland to be able to take advantage of the sustainable growth and prosperity that energy efficiency can help to deliver. central government, local government, government agencies and public bodies can all play a pivotal role. this may be in respect of their own estate and activities, their influence on partners to reduce their energy consumption and that in the sectors for which they are responsible, and through their relationships with scottish business and industry. for example: As government, our role is to invest in an energy efficient future, tackle unnecessary obstacles, set clear direction through legislative framework and challenging regulatory standards, and to lead by example. We have, for example, brought together our energy and climate change directorates into a single new energy directorate in order to align and drive forward all our work on climate change and the low carbon economy. local Authorities will implement much of our energy efficiency activity at a local level. they can influence and support a change in communities and individuals energy efficiency behaviours through the delivery of their services, their role in planning, and their leadership of local planning partnerships. the nhs has made significant progress in reducing energy across its estates and will continue to do so. it also has a real opportunity to spread the energy efficiency message widely through community health partnerships and engagement with local communities. Businesses are well placed to lead a shift in attitudes such that energy efficient behaviours and the production or adoption of low carbon products and processes become standard. energy and resource efficiency makes good business sense given the high fuel costs for large companies and the marginal profits under which smes often operate, and the transition to a low carbon economy offers sound business opportunities. community groups and householders have a key role to play in raising consumers awareness and encouraging informed public debate about the environmental and energy impact of goods and services. We will engage with partners more fully on an ongoing basis, whether with regard their core activities or their wider encouraging activity. As outlined in Action 1.5, we will develop an energy efficiency stakeholder engagement plan within the context of climate change and low carbon engagement. We will work closely with, and build on, the activities of as many cross-interest groups as we can, most notably the 2020 climate change group, the public sector climate Action group, and the first Minister s energy Advisory Board. We will feed in those energy efficiency elements which further broader agendas, and draw upon their expertise and advice to further specific energy efficiency activity. We will also identify a member of the energy Advisory Board to take a specific interest in energy efficiency in order to complement the interests of existing members and champion energy and wider resource efficiency issues. 92

99 Action 10.2 We will work with partners from across the UK to promote joint working and learning, and will be asking the UK Government to guarantee that its new policies will support the aims of this Energy Efficiency Action Plan. As set out in our National Conversation Paper on Energy in november 2009, the scottish government believes that the scottish parliament should be given powers over energy market regulation to ensure that the operation of the gb energy market fully respects the contribution scotland is making to shared targets. in the short term, our key priority is to work closely with decc, ofgem and energy suppliers to ensure that the way that current and future obligations work better reflects the priorities in this action plan. We are working closely with decc in respect of plans to reform the post-2012 cert programme to form the new energy company obligation and to develop the green deal. this will target all Scotland has more ambitious climate change targets than the rest of the UK and will therefore make a larger than proportionate contribution to UK climate change targets. Many aspects of energy efficiency are devolved, but key aspects, particularly those relating to energy market regulation, are currently reserved to the UK Parliament. To date, rules and regulations set at UK level have tended to give inadequate recognition to Scottish circumstances and have led to Scotland not receiving a proportionate share from funding streams such as the energy supplier obligation, despite Scottish consumers contributing to CERT levies. sectors and seek to ensure that the new approaches are much more effective than previous ones (see also Action 2.3). More broadly, we will work with partners from across the UK to promote joint working and learning. We will use our links with energy efficiency bodies such as the energy saving trust and the carbon trust, as well as research bodies such as the (scottish) energy technology partnership. We will work with the energy efficiency partnership for homes, for example in relation to their skills work for the UK green deal, and seek to exchange learning with other governments such as the Welsh Assembly and the greater london Authority, most notably with reference to london s status as low carbon economic Area for energy efficient buildings. Action 10.3 We will further the aims of this plan through our international engagement and by seeking to influence European policy in line with our common interests in energy efficiency. the eu s energy efficiency Action plan has led to significant advancements in community energy efficiency and savings policy. however, in May 2010, the eu s consultation on its revised energy Action plan noted that the potential for energy savings remains greatly underutilised and that a sustainable and low carbon economy will be impossible to achieve without improved energy efficiency behaviours, energy savings and a reduction in energy intensity. in particular, it noted the need for more financing, awarenessraising, a qualified workforce, a quicker uptake of energy efficient technologies and innovation, and better functioning markets for energy services to facilitate a higher uptake of energy efficiency. the scottish government s Action Plan on European Engagement identifies the low carbon economy as a major economic opportunity for scotland and outlines our ambition to make scotland a leader in international energy policy. given scotland s expertise in low carbon technologies and vast renewable energy potential, we have an immense amount to offer in terms of capacity and cutting-edge thinking in the fight against climate change. this applies as much to energy efficiency as to other parts of the sustainable energy agenda. 93

100 Reducing energy consumption and eliminating energy wastage are key European Union goals, aimed at improving competitiveness, security of supply, and meeting Kyoto climate change commitments. The EU first pledged to cut its annual consumption of primary energy by 20% by 2020 at the end of It is now working to mobilise public opinion, decision-makers and market operators, and to set minimum energy efficiency standards and rules on labelling for products, services and infrastructure. It is also engaged in a process to measure the extent to which individual Member States are on course to meet the targets, and may decide that mandatory provisions are required to achieve this. The EU sees particular potential for reducing consumption in energy-intensive sectors such as construction, manufacturing, energy conversion and transport. The European Council and Parliament have agreed a revised Energy Performance of Buildings Directive and Energy Labelling Directive. Eco-design measures have also been adopted, including the phasing out of incandescent light bulbs. The Commission has proposed a new framework for energy efficiency policies. This will address bottlenecks to implement measures already adopted and explore additional instruments that could be needed to support legislation, for example with reference to energy efficiency in buildings. It recognises Member States crucial role in implementing energy efficiency measures, and seeks to identify the different European, national, regional and local levels of intervention needed to increase the ownership and overall coordination and coherence of measures. It will analyse possible sources of financing - continuing to mobilise Structural and Cohesion funds and possibly setting up innovative financial instruments. In March 2010, the Council of Ministers endorsed the objective of moving towards a 20% increase in energy efficiency as part of its strategy to achieve the headline EU 20/20/20 climate/energy targets (20% reduction in GHG emissions; 20% reduction in energy consumption; 20% of energy to be sourced from renewables, all by 2020) and to improve the EU s competitiveness. The alignment of future Cohesion Policy with this Europe 2020 Strategy will provide a key mechanism to achieve this. A key priority is to develop collaborative partnerships with eu partners which promote common action on energy efficiency. our ambitious climate change targets mean that we will always seek to make more progress, and we want to learn from the experience of other countries that have been investing in this area. We have begun discussions with partners in germany and other eu countries, and will continue with these. in addition, an early priority will be to discuss with scottish local authorities and the scottish green energy centre (segec) how best to support scottish involvement in the eu s smart cities and regions initiative. this is supported by the covenant of Mayors, which covers more than 1000 cities, and is designed to support cities and regions in taking ambitious and pioneering measures to reduce greenhouse gas emissions through the sustainable use and production of energy. this will require systemic approaches and organisational innovation encompassing energy efficiency, low carbon technologies and the smart management of supply and demand. in particular, it will include measures on buildings, local energy networks and transport (see also Action 4.6). 94

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102 Crown copyright 2010 ISBN: This document is also available on the Scottish Government website : APS Group Scotland DPPAS10725 (10/10) w w w. s c o t l a n d. g o v. u k