Draft Energy Strategy and Just Transition Plan

Annex I - Scottish Government energy sector funding and finance

Preparing Scotland for a Just Energy Transition

Fuel Insecurity Fund

We have invested £10m through our Fuel Insecurity Fund and have committed to use the Emergency Budget Review to double it to £20 million this year.

CARES (Community and Renewable Energy Scheme)

CARES aims to accelerate progress towards the Scottish Government's ambition of 2 GW of community and locally owned energy by 2030. The goal of CARES is that communities across Scotland are engaging, participating and benefiting in the energy transition to net zero. This is achieved through funding and support for community groups to install renewable energy generation.

Green Jobs Fund

£100m Green Jobs Fund aims to support businesses to create and maintain jobs that improve the environment, and to support projects that align with Scottish Government net zero policies.

Just Transition Fund

The Just Transition Fund (JTF) is a £500 million ten-year commitment that supports projects in the North East and Moray which contribute towards the region's transition to net zero. This includes a commitment of £100,000 in grant funding to support just transition capacity within the trade union movement.

Climate Justice Fund

The world-first Climate Justice Fund has been trebled to £36 million over this parliamentary term and we are also providing the Women's Environment Development Organisation with £50,000 annually to support capacity building and training for women to engage in UNFCCC talks and integrate gender equality considerations into the outcomes.

City Region and Regional Growth Deals

City Region and Regional Growth Deals have now been announced for every part of Scotland, with Scottish Government investment totalling more than £1.9 billion. They are packages of funding and decision making powers agreed between the Scottish Government, UK Government and local partners. Across Scotland numerous energy projects are being supported.

Energy For Heat in Buildings

Heat and Energy Efficiency Scotland

We are investing over £1.8 billion in decarbonising homes and buildings, through Scotland's Heat and Energy Efficiency Agency, over the course of this parliament.

Area based schemes

Our local authority led Area Based Schemes continue to provide grants for all of Scotland's local authorities to unlock investment in schemes targeting fuel poor areas (including hard to treat properties) and high levels of fuel poverty. A whole-house retrofit approach is prioritised. LAs can use part of the funding provided to pay for their own enabling costs.

Scotland's Heat Network Fund

Our £300 million Heat Network Fund provides grant funding to support the development and rollout of zero emission heat networks across Scotland.

Heat Network Support Unit

The Heat Network Support Unit aims to support the growth of heat networks by working with the public sector to address key challenges and build capacity through advice, expertise and financial support.

Social Housing Net Zero Heat Fund

Our £100 million Social Housing Net Zero Heat Fund provides a blend of capital grant and low interest finance for zero emission heat and energy efficiency retrofit in social rented properties.

Green Public Sector Estate Decarbonisation Scheme

Our £200 million Green Public Sector Estate Decarbonisation Scheme provides capital support to aid the decarbonisation of Scotland's Public Sector Estate.

Warmer Homes Scotland fuel poverty programme

The Scottish Government's Warmer Homes Scotland programme offers funding and support to households struggling to stay warm and manage energy bills. It is targeted at less energy efficient homes, as well as households with low incomes or those who are particularly vulnerable to the effects of cold (via a range of benefit proxies). Interest-free loans with significant cashback grants for energy efficiency and zero emissions heating are available to all homeowners (not limited by targeting like WHS and ABS).

Home Energy Scotland (HES) Grants and Loans

Funding for homeowners to install energy efficiency measures and zero direct emissions heating systems in their homes. A standalone grant has been introduced to replace the cashback element of HES Loans for domestic owner occupied properties. The new grant provides funding for heat pumps up to £7,500 and for energy efficiency improvements – up to 75% of the combined cost of the improvements and up to a maximum grant amount of £7,500. A rural uplift of £1,500 applies to both the heat pump and energy efficiency grants.

Business Energy Scotland SME Loans and Cashback

Funding for small and medium-sized enterprises to install energy efficiency measures and zero direct emissions heating systems in their premises

Affordable Housing Supply Programme

Through the Affordable Housing Supply Programme, we continue to support affordable housing providers who wish to install zero direct emissions heating in homes ahead of regulatory requirements in 2024.

Energy for transport

Bus Partnership Fund

The Scottish Government is continuing its programme of investment for over £500 million in bus priority infrastructure. The Bus Partnership Fund will support local authorities, in partnership with bus operators, to tackle the negative impact of congestion on bus services so that bus journeys are quicker and more reliable – encouraging more people to travel by bus.

Domestic EV fund

Provides a £300 grant towards the cost of purchasing and installing a home chargepoint, this fund is targeted at people living in a category 5,6,7 or 8 or an island in Scotland where installation costs are higher due to their locations.

Business EV fund

Covers 50% of the cost of purchasing and installing an EV chargepoint for eligible small and medium-sized enterprises (SMEs) and again. It is targeted at those in category 5,6,7 or 8 or an island in Scotland. These chargepoints can be used for occupants, staff and visitors.

Low Carbon Transport Loan

Supports purchase of used EVs by offering interest free loans of up to £30,000 with a repayment term of up to 5 years. This supports low income households make the change to EVs and loan recipients can also access the Domestic EV fund regardless of where they stay.

Energy for industry

Scottish Industrial Energy Transformation Fund (SIETF)

The SIETF will provide £34m grant funding to reduce energy costs and emissions through increased energy efficiency. Decisions on funding awards are weighted towards energy and/or carbon savings and it's primarily aimed at businesses with high energy use.

Low Carbon Manufacturing Challenge Fund

The Low Carbon Manufacturing Challenge Fund is administered by Scottish Enterprise and will run until 2025-26, providing more than £25 million to support eligible projects over the next four years. Research and development funding will support innovation in low carbon technology, processes and infrastructure within manufacturing.

National Manufacturing Institute Scotland Funding

The Scottish Government is investing £75 million in the National Manufacturing Institute Scotland (NMIS) to enable industry, academia and the public sector to work together on manufacturing research to transform productivity levels, increase competitiveness and boost the skills of our workforce.

Emerging Energy Technologies Fund

The £180 million Emerging Energy Technologies Fund (EETF) supports the development of the hydrogen sector and carbon capture and storage (CCS), including Negative Emissions Technologies (NETs) in Scotland. The EETF will provide capital support over five years (2022 – 2026) to accelerate low carbon infrastructure projects that will be essential to deliver net zero. £100 million is available to support renewable hydrogen projects and we have offered £80 million from the EETF to accelerate the deployment of the Scottish CCUS Cluster. Due to delays with the UK Government announcing the Scottish Cluster, we have re-profiled our offer of financial support into subsequent years.

CO₂ utilisation Challenge Fund

The £5 million CO₂ Utilisation Challenge Fund will help businesses and organisations develop and commercialise the technology, which involves harnessing and converting CO₂ – the biggest contributor to climate change emissions – and using it to produce valuable products, such as synthetic fuels and proteins for use in aquaculture.