On the 28th November 2023, the Scottish Government released a long-awaited consultation on a prospective Heat in Buildings Bill. This blog sets out the details of the proposals and the legislative timeframe. It links to an accompanying blog on the wider Scottish and UK Government policies that will influence the move to zero carbon heating.
The Heat in Buildings Bill proposals
As observed in the consultation document, the current uptake rate of zero carbon heating systems (around 5,000 heat pumps per year) is nowhere near enough to achieve Scotland’s net zero obligations (the Climate Change Committee had estimated 200,000 per year needed by the late 2020s). As a result, regulations, requiring households and businesses to install zero carbon heating systems, are thought necessary.
It is well-recognised that decarbonising heat is one of the most challenging parts of achieving net zero. Almost all properties will have to make a change of some sort, with net zero scenarios involving very little, or no emissions from heating buildings.
The consultation proposes to introduce a Bill to provide for a new Heat in Buildings standard. The standard consists of two broad types of changes:
- Minimum energy efficiency standards (MEES): achieved primarily by improving the insultation – walls, windows, roof, or floor – of a property.
- Clean heating systems: achieved by installing a a clean heating system e.g. a heat pump, instead of a gas/oil boiler.
Within these it is important to recognise that some proposed dates in the consultation relate to:
- the date from which change will begin to be required in certain circumstances (trigger dates), or to
- the date by which change must be implemented (backstop dates).
The context for the consultation is a variety of Scottish and UK dates for change – with the recent changes to UK dates explored in another SPICe blog. This Table sets out the proposed Scottish dates, and specific details of what might be required by these dates is given in the following text.
| Type of change | Policy areas | Proposals (**or already legislated for) |
| Minimum energy efficiency standards – a limited set of key energy efficiency measure is proposed | For owner occupied homes | 2033 (backstop date) |
| For private rented homes | 2028 (backstop date) | |
| For social housing a fabric efficiency rating is proposed* | 2033 or 2040 backstop date depending on choice of ratings | |
| For non-domestic buildings | No requirements | |
| Clean heating systems – no fossil fuel boilers | Oil boilers to clean heating systems in all existing buildings | 2028***(earliest possible trigger date) 2045 (backstop date) |
| Gas boiler to clean heating systems in all existing buildings | 2028***(earliest possible trigger date) 2045 (backstop date) | |
| New buildings to have zero carbon heating | 1st April 2024** |
* This is subject to a separate consultation (see below). The social sector requirements will not need legislation.
** This applies to new buildings (and conversions) that apply for a building warrant from this date. New developments applying for a building warrant before 1st April 2024 may continue to install direct emission heating systems for as long as the issued building warrant remains valid.
*** This date is not explicitly stated in the consultation document but in the Ministerial statement it was implied (see below)
Developments in the Scottish proposals
Overall, the proposed key dates for MEES remain the same as they were in the Heat in Buildings Strategy (HiBS) 2021. The proposals do, however, set out a different approach to defining the minimum standard.
In the HiBS, it was envisaged that a level equivalent to Energy Performance Certificate (EPC) C would be the minimum. The consultation, however, includes a list of six favoured energy efficiency measures e.g. loft, cavity wall and floor insulation, and states that if these were installed a majority of Scottish homes (around 66%) would reach a ‘good level of energy efficiency’. Most notably this list does not include solid wall insulation (while about a quarter of homes in Scotland have solid/other walls, only about one in five of these have solid wall insulation).
It is also proposed that owner-occupied homes that have clean heating systems installed by 2033 will not have to adhere to the MEES. Private rented homes will, however, still have to adhere to MEES even if the property already has a clean heating system by 2028.
For clean heating systems the key dates have changed (since HiBS). The HiBS had given a commitment ‘to phasing out the need to install new or replacement fossil fuel boilers in off gas properties from 2025, and in on-gas areas from 2030’. The new proposals do not actually propose specific new dates for when new gas and oil boilers will no longer be permitted. The accompanying Ministerial statement, however, sets out:
- ‘the position that we set out in our 2021 strategy (HiBS) of starting the heat transition at different times in off gas and on-gas areas—in 2025 and 2030 respectively—is no longer our intended approach. A single timeline that takes effect from 2028 will be fairer and clearer’
Therefore, it can be expected that on, and off, gas properties will now be on the same time frame and the earliest date this will be from is 2028. The backstop date for clean heating systems in all properties is re-stated as 2045. There is an earlier date for public non-domestic buildings with ‘all buildings owned by a Scottish public authority to be using clean heating systems by the end of 2038.’
Overall, due to the proposed changes the Scottish Government accept that the previous stated goal of 1 million properties being on zero carbon heat by 2030 is no longer possible, and that ‘more of the transition to clean heat shifts into the early 2030s instead.’
The trigger point for change
As observed by the Climate Change Committee, the Scottish Government ‘does not have powers to restrict the sale of replacement fossil fuel boilers’ and thus another mechanism is proposed to move homes to clean heating systems.
After undertaking ‘social research to help our understanding of public attitudes to the use of regulations’ the preferred trigger for conversion to clean heating systems is property transactions; buying / selling or leasing a property. The proposal is to:
- ‘Require those purchasing a property to comply with the prohibition on polluting heating within a specified amount of time following completion of the sale.’
A potential grace period, to have the new system installed, is proposed. It is suggested that 2-5 years after a property purchase may be appropriate. The proposal places no new obligations on sellers.
Another potential point for triggering the need to install a clean heating system is when the existing heating system is replaced. Due to the present lack of development in the market and supply chain it is thought that this option is not currently ‘affordable’ or ‘feasible’. It is however, proposed that the Bill will provide Ministers
- ‘with the ability to require homes and non-domestic buildings to end their use of polluting heating in other circumstances (beyond the purchase of a property)’ if the market develops to allow this.’
Cost cap, exemptions, and extra time
The proposals include some potentially important mitigating factors that may affect the timing or extent of change.
There is potential for a cost-cap (the maximum amount a property owner is required to spend in order to meet the standard) being applied to meeting the Heat in Buildings Standard. Options for how the cap could be designed are given including a ‘flat cap’ (fixed amount for all properties), a ‘size-based cap’ (cap that varies by floor area) or a ‘purchase price-based cap’ (cap that varies by property value). The pros and cons of these options are examined in the consultation document.
It is suggested there could be exemptions and extra time to meet the standard, or a requirement for people to comply with a modified version of the standard ‘which takes into account their building’s characteristics or unique circumstances’. Examples given of possible exemptions include for first time buyers, or for certain businesses ‘to protect the local or national economy’. Extra time to meet the standards might be needed for those living in properties for which clean heating options are currently limited, for example for those living in flats.
The HiBS in 2021 recognised the challenges that can be faced in improving energy efficiency, and decarbonising heat, in flats. It established a Short Life Working Group on Tenements to offer advice to the Scottish Government in developing options on the best approach for tenement buildings.
The Scottish Government states that it will be ‘guided by the recommendations’ of the Working Group with its report published at the same time as the consultation. Recommendations include supporting the Scottish Government’s proposed phased approach to regulating flats, supporting consideration of a ‘whole tenement’ energy efficiency standard being set in future should the development of future powers make this fair and viable, and amendments to tenements legislation.
Heat Networks
A key potential means of providing zero carbon heat is via a heat network. When considering the proposed regulations, a critical consideration for Scottish property owners is whether they are in a Heat Network Zone.
Heat Network Zones will typically be where heat networks are thought most feasible (typically heat dense areas, thought to overall cover ‘between 17.1 – 32.1% of Scotland’s total heat demand’) and will be designated by Local Heat and Energy Efficiency Strategies (LHEES)
It is proposed that the Bill would:
- ‘Provide local authorities and the Scottish Ministers with powers to require buildings within a Heat Network Zone to end their use of polluting heating systems (by a certain date, and with a minimum notice period).’
If a property is in a Heat Network Zone, then the requirements for a clean heating system after property purchase will not apply (as a means of encouraging connection to the potential heat network).
Compliance and enforcement
With respect to compliance, it is proposed that the reformed Energy Performance Certificate (EPC) system could be used to demonstrate that changes have been made, potentially alongside some form of random property checks.
Properties that do not meet the MEES by the backstop date will not be prohibited from sale. However, properties in the private rented sector which don’t meet the MEES by the end of 2028 will ‘not be allowed to be leased to a new tenant’.
While civil penalties could be applied to private landlords for leasing properties that don’t meet the standards, it is proposed that this would not be suitable for other property owners (‘at least when first introduced’).
While the Scottish Government acknowledged that some kind of enforcement is necessary to make the regulations ‘credible’ this appears to be one of the less well-developed proposals in the consultation with appropriate monitoring and enforcement bodies still to be identified. It is accepted that ‘relevant powers’ that provide ‘compelling reasons’ for people to meet the requirements must be included in the Bill.
Social housing
Around a fifth of all homes in Scotland are owned by social landlords (councils and housing associations). These are not included in the HiB bill proposals, as social landlords have already been working to decarbonise their homes, in line with policy set by the Scottish Government.
However, at the same time as the HiB bill consultation the Scottish Government published a separate consultation on a new Social Housing Net Zero Standard in Scotland (SHNZS) to replace the second Energy Efficiency Standard for Social Housing (EESSH2). These standards, which contained 2025 and 2032 energy efficiency milestones, have been put on hold.
The main proposals for the SHNZS, are:
- A fabric efficiency rating, which focuses on the amount of energy for heat consumed by a property, measured in kWh/m2/year. The level and dates are being consulted on with the earliest date for compliance being 2033.
- As with other buildings there would be a requirement to replace polluting heating systems with a clean heating alternative by a backstop date of 2045. The consultation seeks views on interim targets or milestones for the social rented sector.
This consultation closes in March 2024. The Scottish Government expects that the new SHNZS will be introduced in 2025 at the earliest.
Legislative timetable
There are some important considerations with respect to when and how the proposals might be legislated for. While the Bill would provide the Scottish Government with the powers to regulate for the introduction of clean heating systems and MEES, secondary legislation is very likely to be used to introduce many of the actual dates and rules. At the end of the consultation, it states:
- We intend to pass the Heat in Buildings Bill by the end of this term of the Scottish Parliament (in May 2026) but have not provided any specific dates about when the new laws would apply (should they be passed by the Scottish Parliament). This is because it is for the Scottish Parliament to decide when it will consider the Bill, at each Stage.’
So, while the Bill may be passed in this parliamentary session, it is possible that the actual legislation that enacts the proposed changes will not happen this session. It could, therefore, be the responsibility of a new government to introduce the detailed dates and regulations. The Minister outlined in Parliament on the 28th of November 2023:
- ‘If Parliament has, by 2025, passed the bill that I intend to introduce, detailed secondary legislation will be required, and it will be the next parliamentary session before those regulations have an impact’.
The consultation on the bill closes on the 8th March 2024. An accompanying blog considers the wider policy landscape and the role of the Scottish and the UK Governments with respect to decarbonising heating.
Niall Kerr and Kate Berry, Senior Researchers