Heat in Buildings: progress report 2024

2. Outcomes

2.1. Outcome: reduced energy demand to buildings

2.1.1. Method: ensuring a good level of energy efficiency in domestic properties

2.1.1A Indicator: share of domestic properties achieving a good level of energy efficiency (currently equivalent to Energy Performance Certificate (EPC) C or better):

• share of owner-occupier properties
• share of private rented sector properties
• share of social rented sector properties

Data source: Scottish Housing Condition Survey (SHCS)

Unit: per cent

Most recent data:

Year	2019	2022
Share of owner-occupier properties (%)	41	48
Share of private rented sector properties (%)	40	50
Share of social rented sector properties (%)	56	65

Commentary:

The percentage of dwellings achieving an EPC rating of at least C under SAP2012 (RdSAP v9.93) has increased across all tenure types between 2019 and 2022. The last year for which comparable data are available is 2019 (due to the COVID-19 pandemic, fieldwork for the 2020 SHCS was suspended and the methodology for the 2021 SHCS was also affected).

The percentage of owner-occupied dwellings achieving an EPC rating of at least C increased from 41% to 48% (from 2019 to 2022). The percentage of private rented sector dwellings achieving an EPC rating of at least C increased from 40% to 50% (from 2019 to 2022). The percentage of social rented sector dwellings achieving an EPC rating of at least C increased from 56% to 65% (from 2019 to 2022).

See indicator 4.2.1(A) for more details about proposed regulations to significantly improve the energy efficiency of Scotland’s homes.

2.2. Outcome: increased supply of clean heat to buildings

2.2.1. Method: uptake of low emissions heating and clean heating in domestic properties

2.2.1A Indicator: number of domestic properties currently with clean heating systems:

• heat pumps
• connected to a heat network
• other electric heating

Data source - heat pumps and electric heating: SHCS

Data source - heat networks: Heat Networks Metering and Billing Regulations (HNMBR) data

Unit: number of domestic properties

Most recent data:

• heat pumps: 36,000 (around 1.4% of all dwellings)
• connected to a heat network: 27,900 (around 1.1% of all dwellings)
• other electric heating: 241,000 (around 9.7% of all dwellings)

Year	2019	2022
Heat pumps	21,000	36,000
Heat networks	N/A	27,900
Other electric	242,000	241,000

Commentary:

The number of dwellings with a heat pump or other electric heating in 2022 is similar to 2019, the last year for which comparable data are available^[6].

The number of properties connected to a heat network for 2022 is based on HNMBR notification data spanning 2014 to 2022^[7]. The estimate relies on limited data with concerns about its quality, including known inconsistencies in the way that heat network operators have reported customer connections in the HNMBR data, such as listing a local authority or housing association as one customer (as opposed to listing each property within either that they are supplying). The number of domestic connections is therefore likely to be an underestimation.

Indicator 4.2.1(A) includes further details about the Scottish Government’s proposed regulations to scale up the installation of clean heating in Scotland’s homes.

2.2.1B Indicator: number of domestic properties recently installing a clean heating system:

• heat network connections (four-yearly connections data)
• heat pumps (annual installations)
• other electric heating (annual installations)

Data source - heat pumps: Microgeneration Certification Scheme (MCS)

Data source - heat networks: HNMBR data

Data source - other electric heating: no data source currently

Unit: number of properties

Most recent data:

• heat pumps (annual installations): 6,388
• heat network connections (data spanning 2018-2022^[8]): 3,687
• other electric heating (annual installations): N/A

Year	2019	2020	2021	2022	2023
Heat pumps	2,448	2,993	4,667	5,146	6,388

Commentary:

Data for the last full calendar year (2023) indicate that the number of heat pumps installed per annum in Scotland has more than doubled since 2019, and increased by 24% in 2023 relative to 2022. MCS data are published on the MCS dashboard in real time and indicate the number of heat pumps installed in Scotland between August 2023 and July 2024 as 7,353. This figure is higher than the same period the previous year, with 5,526 heat pumps installed between August 2022 and July 2023.

The heat networks figure is based on the latest HNMBR data cycle (2018-2022) and includes connections to new heat networks (i.e. those which were completed within the previous four years). It does not include new connections to existing heat networks; therefore this figure may be an underestimate. The data limitations of the HNMBR data source described in the commentary at 2.2.1A are also relevant to this indicator.

We do not currently have a reliable data source for the number of other electric heating systems installed each year.

2.2.1C Indicator: number of domestic properties with low emission or low emission ready heating systems, such as:

• biomass boilers
• combined heat and power (CHP)
• fuel cells
• hybrid heat pumps
• hydrogen-ready boilers

Data source - biomass boilers, CHP: SHCS

Data source - fuel cells, hybrid heat pumps and hydrogen-ready boilers: no data source currently (not currently covered by SHCS but could in future if these systems become more prevalent).

Unit: number of properties

Most recent data (2022):

• biomass boilers: 12,000
• CHP: 6,000
• fuel cells: N/A
• hybrid heat pumps: N/A
• hydrogen-ready boilers: N/A

Year	2019	2022
Biomass	16,000	12,000
CHP	9,000	6,000

Commentary:

Latest data (2022) indicate that around 12,000 Scottish homes (around 0.5% of all dwellings) use biomass as their primary heating fuel. As well as biomass boilers, this includes those using a wood burning stove as their primary heating source. There are an estimated 6,000 homes using combined heat and power (CHP) (around 0.2% of all dwellings). This is similar to 2019, the last year for which comparable data are available.

The SHCS data do not currently record all low emission or low emission ready heating systems, such as fuel cells, hybrid heat pumps and hydrogen-ready boilers, but it may be possible to do so in the future.

2.2.1D Indicator: percentage of new domestic properties with clean heating system completed in the last year:

• with heat pumps
• connected to a heat network
• with other electric heating

Data source: EPC register

Unit: per cent

Most recent data^[9] (2023):

• with heat pumps: 14%
• connected to a heat network: 6%
• with other electric heating: 6%

Year	2019	2020	2021	2022	2023
Heat pumps	10%	8%	12%	15%	14%
Heat networks	5%	1%	6%	7%	6%
Other electric	2%	1%	3%	2%	6%
Total	17%	10%	21%	24%	25%

Commentary:

In 2023, 25% of new domestic buildings are estimated to have clean heating. This is similar to 2022, when 24% are estimated to have clean heating. In 2019, 17% of new domestic buildings are estimated to have clean heating.

The NBHS currently means that no new buildings constructed under a building warrant applied for from 1 April 2024 will have heating systems such as gas and oil boilers, and will be built instead with alternatives, like heat pumps and heat networks. However, there will still be new buildings built with polluting heating systems over the next few years where they are based on a building warrant that was approved prior to this date. Therefore we would expect to see the percentage of new domestic properties with clean heating systems increase significantly over the next few years.

2.2.2. Method: uptake of low emissions heating and clean heating in non-domestic properties

2.2.2A Indicator: number of non-domestic properties currently with clean heating systems:

• heat pumps
• connected to a heat network
• other electric heating

Data source - heat networks: HNMBR data

Data source - heat pumps and other electric heating: Non-Domestic Analytics (NDA)

Unit: number of properties

Most recent data:

• heat pumps (2024 data^[10]): 73,530
• connected to a heat network (data spanning 2018-2022^[11]): 2,450
• other electric heating (2024 data^[12]): 81,300

Commentary:

Data for heat pumps and other electric heating are from NDA, a database produced by Energy Saving Trust on behalf of the Scottish Government to provide a comprehensive resource on the non-domestic building stock in Scotland. We present only the latest 2024 data from the dataset, which include notifications up to May 2024. This is because later editions include improvements to the methodology and data sources in a way that is not comparable with historic NDA data.

NDA brings together various sources of data on non-domestic buildings and uses statistical models to help fill data gaps in the underlying data sources. This is challenging due to considerable variation in the types and purposes of non-domestic properties, as well as a lack of detailed information on their characteristics and poor coverage of existing datasets. For example, less than one fifth of properties within NDA dataset have an EPC record. We are continuing to explore options to fill this data gap, including working with key stakeholders to develop and enhance data sources.

The number of properties connected to a heat network in 2022 is based on HNMBR notification data spanning from 2014-2022. As with the domestic heat network connections, due to the known inconsistencies with the way that heat network operators have reported customer connections within the HNMBR data, the number of non-domestic connections is likely to be an underestimation.

2.2.2B Indicator: number of non-domestic properties recently installing a clean heating system:

• heat pumps (annual figure)
• heat network connections (four-yearly figure)
• other electric heating (annual figure)

Data source – heat pumps and direct electric heating: no data source currently

Data source – heat networks: HNMBR data

Unit: number of properties

Most recent data:

• heat pumps (annual figure): N/A
• heat network connections (four-yearly figure): 177 (2018-2022)
• other electric heating (annual figure): N/A

Commentary:

As with the domestic data, the estimate of new non-domestic connections to heat networks is based on the latest HNMBR data cycle (2018-2022) and includes connections to new heat networks (i.e. those which were completed within the previous four years). This figure may be an underestimate as it does not include new connections to existing heat networks.

We are working with Energy Saving Trust to develop indicators to address data gaps related to non-domestic properties.

2.2.2C Indicator: number of non-domestic buildings currently with low emission or low emission ready heating, such as:

• biomass boilers
• CHP
• fuel cells
• hybrid heat pumps
• hydrogen-ready boilers

Data source - biomass boilers and CHP: NDA

Data source - fuel cells, hybrid heat pumps and hydrogen-ready boilers: N/A

Unit: number of properties

Most recent data ( 2024 data^[13]) :

• biomass boilers: 479
• CHP: 159
• fuel cells: N/A
• hybrid heat pumps: N/A
• hydrogen-ready boilers: N/A

Commentary:

Data presented for biomass boilers and CHP are from the NDA database. As with indicator 2.2.2A, we present only the latest 2024 data from the dataset. There are limitations to the data collected through this database and comparisons with historic NDA data are not suitable, data are cumulative and include notifications up to May 2024. As NDA groups biomass and solid fuels together, the figure reported for biomass boilers will include some properties that use solid fuel as their main fuel type.

We are continually seeking to improve the quality and granularity of data on non-domestic buildings, including updates to NDA and working with the UK Government which is developing a National Buildings Database^[14]. We are currently unable to track the less common and newer technologies (fuel cells, hybrid heat pumps and hydrogen-ready boilers); however, we expect data on this to become available as non-domestic data develop and the deployment of these technologies increases.

2.2.2D Indicator: percentage of new non-domestic properties with clean heat completed in the last year:

• with heat pumps
• connected to a heat network
• with other electric heating

Data source: non-domestic EPC register

Unit: per cent^[15]

Most recent data:

• with heat pumps: 44%
• connected to a heat network: 3%
• with other electric heating: 26%

Year	2019	2020	2021	2022	2023
Heat pumps	37%	44%	35%	51%	44%
Heat networks	2%	1%	5%	3%	3%
Other electric	19%	19%	18%	14%	26%
Total	58%	64%	58%	68%	73%

Commentary:

In 2023, 73% of new non-domestic buildings are estimated to have been built with a clean heating. This compares to an estimated 58% new non-domestic properties being built with a clean heating system in 2019.

As with indicator 2.2.1D, because building warrants for new non-domestic properties will need to state that the property will be constructed with a clean heating system from 1 April 2024, we expect to see the percentage of new non-domestic properties with clean heating systems increase significantly over the coming years.

2.2.3. Method: rollout of zero emissions heat networks

2.2.3A Indicator: heat supplied by heat networks (statutory target to reach 2.6 Terawatt hours (TWh) by 2027, 6 TWh by 2030 and 7 TWh by 2035) to:

• domestic properties
• non-domestic properties

Data source: HNMBR data

Unit: TWh

Most recent data (data spanning 2018-2022):

• domestic properties: 0.46 TWh
• non-domestic properties: 0.75 TWh
• mixed (both domestic and non-domestic properties): 0.15 TWh

Commentary:

We estimate that a total of 1.36 TWh of heat was supplied via heat networks in Scotland in 2022^[16]. Although it falls outside of this progress report’s reporting window, we estimated that in 2018 a total of 1.15 TWh of heat was supplied via heat networks in Scotland.

This indicator relies on our best estimates on the supply of heat with the limitations of existing data currently available to us. These estimates are based on HNMBR notification data spanning from 2014-2022, aiming to provide an estimate on the whole known heat network sector in Scotland, including known networks that have not notified in the latest data cycle (2018-2022). Our estimate includes a breakdown by domestic and non-domestic properties as well as a mixed category that serves both property types. Our estimate relies on limited data with concerns about quality. This includes poor data coverage in key areas which required modelling to fill in the gaps, lack of information around decommissioning of networks, and issues surrounding enforcement of notifications. All of the above factors limit our ability to estimate the true size of the heat networks sector in Scotland or the total amount of heat supplied.

Indicator 4.2.1F provides details about the Scottish Government’s work to develop a regulatory regime to meet our heat networks statutory requirements, and which we believe will help provide improved data and more accurate reporting in future.

2.2.3B indicator: share of low carbon heat in existing heat networks

Data source: HNMBR data (share of fuel source and technology)

Unit: per cent

Most recent data (2022):

• Share of low carbon heat in existing heat networks: 11%

Commentary:

We estimate that by 2022 around 11% of existing heat networks in Scotland used low carbon heat as a fuel source. This includes heat networks which use electricity, biomass or biogas as their primary fuel.

These estimates are based on the HNMBR data and so the same data limitations described above apply. A further limitation is that this assumes heat networks use only one fuel source. The fuel type of around 5% of heat networks is also unknown, meaning the above figure may be a slight underestimation.

2.3. Outcome: the heat transition is fair, leaving no one behind

2.3.1. Method: heat is affordable

2.3.1A Indicator: percentage of homes in fuel poverty (statutory target in 2040 no more than 5% of households are fuel poor with <1% in extreme fuel poverty)

Data source: SHCS

Unit: per cent

Most recent data (2022):

• Percentage of homes in fuel poverty: 31%

Year	2019	2022
Fuel poverty	25%	31%

Commentary:

In 2022, 791,000 households (31% of all households) were estimated to be in fuel poverty. This is higher than the 2019 estimates (last available comparable data) of 613,000 households (25% of all households) and is largely driven by the increases in energy prices seen in 2022^[17].

SHCS results for 2022 have been assessed to be comparable for the most part to 2019 and earlier years. However, there is evidence to suggest that social and private rented households, who have higher rates of fuel poverty, may be under-represented in the 2022 sample, and owner-occupied households, who have lower rates of fuel poverty, may be over-represented^[18]. This means that national level estimates of fuel poverty may be slightly underestimated; however, we expect any effects to be minor, especially in the context of other key drivers of fuel poverty such as fuel prices.

We continue to work with the Scottish Fuel Poverty Advisory Panel to develop an outcome focussed fuel poverty monitoring and evaluation framework. This will form part of our overall reporting on fuel poverty next year, in line with the Fuel Poverty (Targets, Definition and Strategy) (Scotland) Act 2019. We will aim to align this Framework with the reporting framework for this progress report.

2.3.2. Method: green heat jobs for the heat transition

2.3.2A Indicator: net change in heat and energy efficiency jobs

Data source: available data insufficient for monitoring

Unit: net change

Most recent data:

• N/A

Commentary:

The Office for National Statistics’ Low Carbon and Renewable Energy Economy (LCREE) survey provides annual estimates of the number of full-time equivalents (FTEs) across sectors including renewable heat, renewable CHP, energy efficient lighting and energy efficient products. LCREE also provides data at the ‘low carbon heat’ grouping. However, these data are insufficient for monitoring purposes due to the wide confidence intervals around the estimates at the Scotland level, making it difficult to say whether year-on-year changes are statistically significant or not.

Bespoke research reports have estimated the size of the green heat workforce in Scotland, although most rely heavily on LCREE and, since they are one-off reports, they are unsuitable for tracking purposes.

The Built Environment and Construction Just Transition Plan, due for draft publication in 2025, will explore appropriate indicators to track progress in the sector’s workforce, skills pipeline and supply chain.

We include details about the Scottish Government’s work to support the scale up of the green heat supply chain at indicator 4.2.1C.