Heat in buildings - Scotland's National Public Energy Agency call for evidence: analysis of responses

Annex 2: Additional Evidence & Research Submitted by Respondents

Question 1

Research and other evidence

Some regulations and building specs may still be based on assumptions about a building left over from a previous era, e.g. the assumption that a domestic house will have a fire place, or fail to allow tasteful and decarbonising modifications to historic buildings.

As well as being shaped by our experience Energy Saving Trust's views on a potential National Energy Agency have also been shaped by relevant research including the Scottish Government commissioned 2019 "Strategic Outline Case for Proposed Development of a National Delivery Mechanism" 1 Executive summary - Energy Efficient Scotland programme: analysis of delivery mechanism - gov.scot (www.gov.scot) and a scoping study commissioned by the Existing Homes Alliance (EHA) (of which we are a founding member) with support from the European Climate Foundation in 2018 which provided an initial assessment of options for the oversight of the Scottish Government's National Infrastructure Priority on Energy Efficiency Energy Efficient Scotland – Options for National Oversight Body | The Existing Homes Alliance | Scotland (existinghomesalliancescotland.co.uk). This scoping study in turn draws heavily on the International Energy Agency's 2010 Energy Efficiency Governance report Energy Efficiency Governance – Analysis - IEA which is a useful reference document in its own right. The report is based on a survey of over 500 experts in 110 countries, follow up interviews with over 120 experts in 27 countries and extensive desk research and literature reviews. It is the only comprehensive study that we are aware of, of the legal frameworks, funding mechanisms, institutional, and co-ordination arrangements needed to scale-up energy efficiency – collectively referred to as Energy Efficiency Governance.

CITB's report Building Skills for Net Zero outlines that in order to meet Net Zero targets, an estimated 22,500 people in Scotland, through re-training and new roles, will need to be trained in energy efficiency by 2028. That represents an increase of around 9% of the current size of the workforce, based on current technologies and ways of working. This can be either through new recruitment from outside the sector or through retraining and productivity gains. There are specific, specialist roles where the shortages are most significant. For example, an additional 4,605 construction project managers will be required by 2028, as well 1,507 construction trades supervisors, and 1,936 building envelope specialists.

In addition to these roles, there is a need for training in the skills required to maintain traditional buildings. 95% of surveyed contractors in Scotland do not hold formal qualifications relating to work on traditional buildings. Only 2% of contractors surveyed in Scotland had undertaken energy efficiency retrofit work on traditional buildings.

The recent Westminster Business Energy and Industrial Strategy Select Committee report into Decarbonising Heat in Homes report3 highlighted the Ofgem consumer engagement survey for 2020 "found that the majority of consumers believe that they are already doing all they can to save energy at home. The survey identified that barriers to the adoption of low carbon technologies included perceived high costs, disruption from the installation process, and doubts about reducing energy bills." It concluded that "consumer awareness of the transition to low carbon heat is low."

Research by Delta-EE6 highlights that:

• in electricity generation, smart meters will allow for more renewable generation, contributing to a 77 per cent CO2 reduction by 2035 (from 2015 levels);
• in homes, smart meters will help accelerate the uptake of energy efficiency measures and low carbon heating, and enable consumers to better engage with their energy use, contributing to a 25 per cent saving in CO2 by 2035 (from 2015 levels); and
• in transport, smart meters will be a critical enabler for high levels of electrification, contributing to a 54 per cent CO2 reduction by 2035 (from 2015 levels).

Research (Hofman et al, 2021) has found that neither top-down nor grassroots approaches alone are sufficient to make progress on decarbonisation but that complementary mixes can be effective. Retrofitting at scale: comparing transition experiments in Scotland and the Netherlands (journal-buildingscities.org)

Innovative groups such as Carbon Coop in Manchester and Low Carbon Hub in Oxford have shown that localised, citizen- and neighbourhood-specific approaches can achieve faster progress in comparison with broad-brushed policy measures. Selected demonstration projects: summaries - GOV.UK (www.gov.uk)

In Scotland, local groups including Loco Home Retrofit CIC in Glasgow and Zero Carbon Daviot are already placed to make significant impact but little or no Scottish government support exists for such programmes.

Loco Home Retrofit CIC Limited | Glasgow's Retrofit Co-operative

Research has demonstrated that PV can make a valuable contribution to reducing social housing tenants' fuel bills and alleviating fuel poverty. Analysis of electricity bills pre and post PV installation in 42 households found an average reduction of £90 per year after the PV was installed.

Both solar PV and thermal collectors can be installed at mass and micro scales to ensure that households, businesses, farmers, manufacturers, and public bodies are able to participate in a just and clean energy transition. There is already close to 600MW of utility-scale solar capacity proposed in the Scottish deployment pipeline that is expected to be co-located with energy storage. However, deployment has historically been challenging for all scales of development. Outdated policies and inconsistent funding have long-prevented homeowners, businesses, and landowners from generating their own clean energy and playing their part in the decarbonisation of heat agenda.

In October last year, the Westminster Government announced that solar PV and auxiliary technologies in England would be exempt from business rates between 2023 and 2035, to support business recovery in the wake of the COVID-19 pandemic. In order to support the decarbonisation agenda in Scotland, Scottish Government should look to exempt solar and storage from non-domestic rates aligning with England.

In order to deliver on both the Scottish Government's and local authorities' own carbon and climate targets, GCR is committed to developing a large scale domestic energy efficiency and low carbon heating retrofit programme. This work commenced in spring 2021 and an initial Strategic Outline Business Case was shared with GCR Cabinet in October 2021. Details on the business case are available here:

Committee Information - Submission Documents (glasgow.gov.uk)

Key to this will be delivering on the recommendations of the Zero Emissions Social Housing Taskforce (ZEST) and learning from experience of the social sector which has already been at the forefront of energy efficiency measures and the transition to low and zero emission heat solutions. ZEST set out some of the key challenges and how to progress the shift to zero emission homes. The priority actions include increased capital investment, designed in line with the needs of the sector, a fabric first approach to reduce overall energy demand and minimise energy costs, and early engagement to ensure tenants are fully supported in the rollout of unfamiliar technologies. The Energy Efficiency Standard for Social Housing (EESSH) will also need to be realigned to support heat decarbonisation and ensure it delivers positive outcomes for tenants.

Publication of a final report by the Heat Pump Sector Deal Expert Advisory Group

An empowered and locally led transition to a low carbon and fairer future will require government and industry to work together to meaningfully engage communities across Scotland in the processes and decisions that matter to them throughout the period to 2045; our (Citizens Advice Scotland) Engaging Heart and Minds report [2020]1 provides a useful starting point for such a program.

Question 2

Research and other evidence

Planning and building success should also be researched, for example Sweden has a very high number of prefabricated buildings which, among other benefits, tend to be easier to heat and have lower carbon emissions than traditionally built alternatives. Therefore they likely have good knowledge of how building regulations can be altered to facilitate energy efficient housing.

Consistency with that outlined by the EHA in their briefing of December 2021 and entitled "A new National Energy Agency for Scotland: key to the successful net-zero transition for buildings" A new National Energy Agency for Scotland – Briefing December 2021 | The Existing Homes Alliance | Scotland (existinghomesalliancescotland.co.uk).

Smart meter installation journey for vulnerable people - Our In Communities programme was created to ensure that we reach and support people who may be experiencing barriers to engaging with the rollout. This means that we partner with trusted, expert organisations from the voluntary and public sector, including many across Scotland, to ensure that everyone understands the benefits of smart meters. Between 2016-2020 we have awarded grants to 23 Scottish organisations including Carers Scotland, Airdrie Citizens Advice, Aberdeen Care & Repair and Argyll, Lomond and the Islands Energy Agency. In our work last year, our In Communities programme focused on providing additional engagement to the over 65 audience. This is because this audience is harder to reach through a mainstream communications approach, and need more support in the smart meter journey. Our partners focused on delivering face-to-face activity, which has proved to be the most effective in increasing the desire for smart meters among this audience. We support our partners by providing free print and downloadable materials in a range of languages and accessible formats such as braille, so that they can run their own campaign. Below are some of the examples of our programme.

2017 Partnership Marketing Programme

In 2017 our partnership marketing programme covered the whole of GB through 5 national partnerships and 111 regional/local partnerships, such as Energy Action Scotland. This included:

• 5 national partnerships (Royal Horticultural Society, Age UK and Age Scotland, Scottish Federation of Housing Associations (SFHA), National Housing Federation, Community Housing Cymru)
• 66 grantees were awarded grants of up to £5,000 (average grant: £3,925)
• 45 unfunded partners who delivered smart metering messages 179 champions were trained through 22 smart meter champion training sessions
• 531 users registered on the Smart Energy GB Resource Centre and downloaded 1,908 assets and ordered 248,305 hard copy assets
• over 430,000 consumers of 65+ offline audience were reached

2018 Partnerships Marketing Programme

A partnership for low-income audiences with supported targeted communication with 10 housing associations which have a particularly high instance of low-income tenants. A partnership with Picturehouse Cinemas which resulted in experiential activity at 'Silver Screenings', including in Edinburgh, to target older audiences. Five grants were awarded in Scotland to support older people audiences. These were Clackmannanshire Citizens Advice Bureau, East Ayrshire Citizens Advice Bureau, Hope Amplified, Airdrie Citizens Advice Bureau, Milan Senior Welfare Organisation.

Partnerships continued into 2019 including work with Carers Scotland. Patricia Clark, Development and Training Manager said: "The partnership funding enabled us to reach many carers in Scotland, face-to-face or online. We were able to give them take home resources and share digital assets in different formats - articles, leaflets, videos and stories. Smart Energy GB also helped us develop our 'Smart meter' webpage and regularly sent us news stories and updates that might be relevant to our activities." "Carers from more vulnerable households found our sessions on smart meters and energy information useful (see quotes below). This made the project especially worthwhile for us." Catherine, 65 "I can see how much energy I have used from my monitor which is really helpful as I can monitor daily, weekly, monthly and annual usage and know if I need to increase my direct debit to cover this especially in the winter months"

Loco Home Retrofit CIC is a community-owned retrofit co-operative in Glasgow. As a community intermediary, it seeks to develop both the market and the supply chain for risk-managed, step-wise whole building retrofit. It directly addresses the key policy challenges of homeowner acceptance, cost, quality assurance and supply chain skills / capacity.

Loco Home's member-owners are homeowners, contractors and retrofit professionals. It provides paid retrofit advice services as well as community engagement activities in the Southside of Glasgow. It has certified Passivhaus level expertise and years of community energy experience in its team.

Loco Home Retrofit CIC has a business plan to expand its paid retrofit advice service if it can raise the working capital to employ staff and franchise a proven methodology. It also has plans to develop scaled approaches to common Glasgow building archetypes and again the main barrier is working capital.

The provision of long-term regulatory support and innovation funding will to demonstrate the potential of a similar scheme in Scotland. An example is REflex Orkney, a multi renewable technology project has future plans to roll out solar and storage as part of a heating installation service to significantly reduce energy bills for consumers and reduce carbon emissions. As mentioned above, including battery storage will support the already heavily constraint grid and store excess generation on the local network to supply during times of high demand. The development of REflex Orkney and similar future models will be vital in meeting decarbonisation targets. We strongly encourage the new agency to support and accelerate the development of innovative business models by unlocking innovation funding.

Question 3

Case Studies and other evidence

Support for the householder is required to convert an interest in taking action to actually taking action. This can include detailed technical advice, supplier selection, review of quotations etc. This is an integral part of Warmer Homes Scotland and EES:ABS. For the self-funding sector a relatively small number of householders are provided with some of this in-depth support by Home Energy Scotland.

(on compliance) The Agency has the opportunity to manage these challenges in a number of ways. It could oversee and improve upon existing monitoring and compliance tools and standards (for example, EPCs, retrofit assessments as part of PAS 2030/2035/2038, etc.), and could monitor the role of trade associations to ensure they won't have too prominent a role in promoting solutions which constrained by the methods and materials used by their members. The Agency could also a dedicated agency could monitor and influence the standard of advice provided by Energy Saving Trust and Home Energy Scotland to ensure consistency and quality, particularly in the context of the differing approaches that may be needed for different building typologies.

(whole system) Finally, across heat decarbonisation and energy efficiency, there may also be useful comparisons with the work BEIS is doing on a Future System Operator in providing whole-system, coordinated analysis and recommendations to Government

(quality assurance) The agency should incorporate in its constitution from the outset mechanisms that balance the lobbying of the major insulation manufacturers with input from smaller manufacturers and independent experts. The Grenfell inquiry shows how destructive a close relationship between manufacturers, testing houses and regulators can be. Unfortunately the same pattern can be seen in PAS2035 whereby it is all but impossible to achieve an insurance backed guarantee using vapour-permeable materials that are appropriate for solid-walled buildings. The agency should commit to PAS2035 and, in particular, independent advice, as the key means of achieving quality installations that will last for many years without damaging the health of the building or the occupants. However it should adopt a pragmatic approach with PAS2035 variations for Scotland. For example, it should allow PAS2035 to be attained for retrofits that use vapour permeable materials which are generally from smaller manufacturers that cannot afford the BBA accreditation necessary for an insurance backed guarantee.

(timescales) There are around 2.3 million homes in Scotland so heating more than 1 million of those homes with a zero carbon heating system by 2030, as envisaged in the Scottish Government's Heat in Buildings Strategy, will mean that on average at least 100,000 new heating systems will need to be installed each year, or 2,000 new systems each week. Currently, 2-3,000 renewable heating systems are installed in homes in Scotland every year. In other words, the level of activity currently taking place each year will need to take place each week if Scotland's ambitions are to be realised.

(retrofit costs) The projected cost of bringing all homes across the GCR to Energy Performance Certificate (EPC) C and above, with many being EPC B and above and some close to or at net zero is estimated to be in the region of £10.7 billion.

We welcomed the Scottish Government's Community and Renewable Energy Scheme (CARES), which is an example of best practice in encouraging development and engaging with a diverse range of voices from the public. The success of the CARES can be measured both empirically, through its addition of over 500MW of renewable energy to the Scottish grid in less than half the projected time, and conceptually through the empowerment of communities and democratisation of energy that has resulted from the funding of enabling direct access to ownership of renewable energy generation assets. its projects. We applaud the CARES success and would encourage the Scottish Government to continue to facilitate and support such initiatives through the proposed agency.

The STUC's Green Jobs Report estimates this could create up to 108,000 jobs

Question 4

Evidence & insights based on experience

The experience that our Council has had with developing an ESCo for our Queens Quay Water Source DHN shows that there is a requirement for an agency that leads and/or supports Scotland in:

• Developing detailed business cases and financial models for heat decarbonisation on a large scale;
• Advising and supporting monitoring, metering and billing responsibilities associated with ESCo's and beyond;
• Detailed and simple legal advice on land, environmental impacts, historical fabric impacts, and landowner engagement, etc.;
• Having an agency that helps develop holistic and partnership based approaches to heat decarbonisation, whether that be cross-sector, partnership between Local Authorities or Private Sector, or community partnerships with residents.

As Simon Roberts of the Centre for Sustainable Energy said in 2017 (see page 5), we need policy makers to stop being obsessed with coming up with the perfect plan for the entire housing stock and should instead focus on the "next million" (on a UK scale). His comments remain relevant today. Policy paralysis in other words.

Centre for Sustainable Energy: Do the next million first: What to do to get the home-owner market going for low carbon retrofit – in a world without grants (presentation) (cse.org.uk)

Based on the success of the local supply chain demonstration projects funded by BEIS, Scottish Government should consider devolving more control or resources to local groups ready to take action.

Selected demonstration projects: summaries - GOV.UK (www.gov.uk)

The integration of new standards such as PAS2035 has been challenging and is still not resolved nearly a year after being introduced as a requirement of Scottish Government schemes. The Agency could bring the expertise and expedite decision making by proactively engaging with Local Authorities/Managing Agents/Contractors to bring consistency and clarity.

The support for Local Authorities around ECO could be better especially with the introduction of ECO4 and its application to Scottish Government programmes. It now can't be blended with other funding (e.g. EES:ABS) so Local Authorities need direction on how best to maximise ECO in their programmes IF this is still a priority for Scottish Government. ECO4 is coming into effect in less than 10 weeks' time.

The integration and blending of community-based work across multiple funding streams to re-focus on a just transition to a low carbon economy. At the moment these projects and programmes (e.g. waste, transport, energy efficiency, decarbonisation) are all disparate elements of a wider low carbon agenda. A central Scottish Government Agency could facilitate the blending of funding to create whole community Net Zero models which would facilitate and accelerate the transition on a whole area basis rather than smaller individual initiatives with lesser impact.

In Stirling, with the Forthside District Heating Network project, at the point of outset, Stirling Council had limited experience in delivering a district heating network. The advisory resources from Scottish Futures Trust were invaluable in delivering this project. A public agency dedicated to heat management systems could fulfil that central expertise and advisory service, essential for delivering the magnitude of low-carbon heat management systems across Scotland.

It is worth noting that the previous administration commissioned a strategic outline case for a proposed 'national delivery mechanism for Energy Efficient Scotland' in 2019. This research recognised the benefits of an independent agency to support meeting government targets, and provides useful analysis of the remit and shape for such a body.

Based on our findings from the international literature, we believe coherent governance includes the need for:

• a legislative framework which lays out the components of the strategy including targets.
• an agency formed by statute with responsibility for oversight and ensuring delivery, and provided with adequate independence, authority and capacity.
  • responsible for delivering a clearly defined set of activities,
  • adequately resourced with well qualified staff and finances,
  • independent of government, given legitimacy via statute
  • overall responsibility to rest with a single senior official, preferably a Minister.

Midlothian Council and Vattenfall's joint venture, Midlothian Energy Limited (MEL), provides useful evidence of a public/private partnership.

The first district heating system crosses East Lothian and City of Edinburgh Council boundaries. This has implications for consistency in terms of permitting and policy around planning, highways, etc. The public body should play a coordinating role to ensure consistent approaches exist across authorities. This is already being picked up through early joint discussion on coordinating Local Heat and Energy Efficiency Strategies (LHEES). The district heating system ownership, consent, permitting and licensing across boundaries will need to be clearly defined. This is the proposal for the current LHEES coordination proposed for South East Edinburgh. That will likely apply in other locations and the NPEA would be well placed to engage in current discussion and to develop this role more widely. The added value to this type of relationship is about management of risk. This is about risk reduction of investment rather than sharing of risk. Both parties bring key attributes and experience to the partnership that reduces investment risk. This allows for long-term investment at a lower risk. This is what enables the deployment of capital, effectively and efficiently, to support low-carbon energy infrastructure.

The Existing Home Alliance has conducted previous research on options for energy efficiency governance in Scotland. Further information on this is provided in the EHA response and the research report: Oversightbody_FINAL-REPORT_Nov18.pdf (existinghomesalliancescotland.co.uk)

We are a member of the Existing Homes Alliance and support the work it did in 2018. Based on its findings from the international literature, we believe coherent governance includes the need for:

• a legislative framework which lays out the components of the strategy including targets.
• an agency formed by statute with responsibility for oversight and ensuring delivery, and provided with adequate independence, authority and capacity.
  • responsible for delivering a clearly defined set of activities, o adequately resourced with well qualified staff and finances,
  • independent of government, given legitimacy via statute
  • overall responsibility to rest with a single senior official, preferably a Cabinet Secretary or Minister.

The main sources for the perspective I have laid out here comes from or is supported by the work of Saul Griffith, US based energy expert, and his organisation Rewiring America. I was unable to attach the reports from their website (Rewiring America) but they have a lot of valuable resources around policy, economic, societal, and household benefits of decarbonising, . As far as I am aware Saul Griffith and his colleagues do provide consultation at the government level to New Zealand, Australia and parts of Europe. The thrust of Griffith's analysis is that the best route to reduce the impact of climate change is a complex multi-level approach focused on electrifying almost everything, and using existing technology to achieve goals. His work is very America focused, but most is applicable to the Scottish context also.

In my experience in public health and behavioural insights, the practicalities and science of sustained implementation is often underspecified when it comes to these ambitious agendas. While it is of course not possible to do everything within a small agency -actively promoting a policy, showing how it should be implemented, and providing support for implementation using evidence from the behavioural and environmental psychology literature is too often overlooked.

Journal of Environmental Psychology - Journal - Elsevier

Implementation Science | Home page (biomedcentral.com)

Behavioral science tools to strengthen energy & environmental policy (behavioralpolicy.org)

Yes. Within Europe were mandated to convert from leaded to non-leaded solder. This took a lot of evaluations and experiments. The transition was project managed effectively and the conformance to the EU directive achieved. The UK is one of the top Electronics manufacturing countries in the world and led in this transition.

While a number of energy transitions have been detrimental to working class communities, the United Kingdom's conversion from 'town gas' to 'natural gas' between 1968 and 1976 involved converting around 40 million appliances for 14 million customers, mostly households. Working alongside 12 regional gas boards, the Government took a central coordinating role, with a nationalised Gas Council giving the state direct control of the required investment Lessons can be learned from all of these examples about the scale of Government intervention require to ensure a comprehensive and successful street by street transition of residential heating. Specifically regarding the design of an effective Agency, we would point to the work of Andy Cumbers and Commonweal which has called for a Scottish Energy Agency, modelled in part, on the Danish Energy Agency.

Sweden's transition to district heating is another example which has enabled high security of supply, low carbon dioxide emissions, and efficient use of available heat sources.

Evidence from across Europe also shows the key role of municipalities in the energy transition – delivering publicly owned renewable energy and delivering retrofitting programmes.

Lessons can be learned from all of these examples about the scale of Government intervention require to ensure a comprehensive and successful street by street transition of residential heating. Specifically regarding the design of an effective Agency, we would point to the work of Andy Cumbers and Commonweal which has called for a Scottish Energy Agency, modelled in part, on the Danish Energy Agency./ We note that the Scottish Government is already in communication with the Danish Energy Agency, which is running a heat-as-a-service focused boiler scrappage scheme, and we would encourage further bilateral discussions to share best practice amongst governments with higher uptake of decarbonised heating

The MCS Charitable Foundation report 'Energising Advice' 1 highlighted the 'postcode lottery' in advice for homeowners when trying to make energy efficiency and retrofit decisions. It revealed that current provision of energy advice and information on retrofitting homes is inadequate and urged central Government to take a new, more radical approach to benefit homeowners across the UK. Current advice availability varies depending on where you live, and in many parts of the UK is too basic for the practical complexities of deep retrofit. The main exception is Scotland, which has set a higher benchmark, and we would urge the Scottish Government to continue to lead the way in this area of such importance in the transition to a Net Zero future. The study assessed over 60 advice services across the UK and pinpointed a clear need for a national information resource underpinned by a network of local and regional hubs, such as those proposed in the outline plans for a National Energy Agency

A national information resource providing expert and regularly updated information resources, covering all relevant technologies and user behaviour: to enable consistency in advice, whoever it is delivered by. This should be:

Commercially independent and unbiased, with public funding to ensure, and to signal to consumers and the industry that this is the case;

Tailored to the specific requirements of owner-occupiers, landlords, tenants, advisers and building professionals and tradespeople;

A framework for local or regional one-stop-shop contact hubs, to support homeowners through the retrofit process.

Development of a new energy advice qualification. This framework will help support individual householders in identifying and delivering the best possible range of energy efficiency and renewable energy measures. Such services should be tailored to meet the specific needs of landlords and tenants as well as owner-occupiers and should become a priority to tackle the massive job of decarbonising homes in Scotland. Clear advice and support enables people to retrofit their homes, help reduce their energy bills and choose the appropriate low carbon heating solution, which is critical for a zero carbon future. A worrying gap in this support is creating barriers to people adopting low carbon technologies in their home.

The research commissioned by the EHA and referenced above (Energy Efficient Scotland – Options for National Oversight Body | The Existing Homes Alliance | Scotland (existinghomesalliancescotland.co.uk)) concluded that "A central and consistent finding in the literature is that the establishment of responsibility with a single agency tasked with oversight for energy efficiency is central to coherent governance." The findings of the Strategic Outline Case commissioned by the Scottish Government are also relevant here in that they highlighted that there was a definite case for a body to take on a range of roles – including many listed in the consultation (coordination and coherence, engagement, etc.). It is also worthwhile noting the Strategic Outline Case emphasised that "the expected 'net' incremental costs to be incurred from developing any new delivery architecture, in advance of the counterfactual, are potentially inconsequential. Over the course of the entire 20-year programme of EES, the additional set up costs of any bodies could be dwarfed by the scale of the benefits and operational costs the programme has the potential to deliver".

There have been many reports and commissioned research and valuations on the need and added potential over the last decade. Some of these include the Danish Energy Agency, which Scotland already has a track record of engaging with. Scotland has already established experience and dialogues, including a Memorandum of Understanding with Denmark. DENA, the German Energy Agency provides a model About dena – Deutsche Energie-Agentur (dena). The Scottish Government may also wish to consider approaches taken by Efficiency Maine Trust, which has seen high recent rates of heat pump uptake across the State of Maine through its heat pump rebate scheme.

We have all witnessed the continued issues around old and heat inefficient buildings and the detrimental impact this has on those most in need within our communities. We have also witnessed inefficient heating systems and badly thought out installer replacement schemes and the negative impact on our communities. We have however also experienced how locally managed schemes have provided numerous people with properly insulated homes and engaging educational workshops. The CPOH members have also carried out various energy efficiency schemes and support packages to householders and are shining examples of how community energy can lead to many other positive changes, if they are supported at the outset to overcome the hurdles faced in installing the community energy technology.

(innovations at home not working out) While we support innovation and new approaches to improved energy efficiency and the decarbonisation of heat, local decision makers must be supported to make things right when a system or product does not work as planned. In its response to the Scottish Government's consultation on the draft Heat in Buildings Strategy 2, the Energy Consumers Commission called for the creation of "a ring-fenced pot of funding to be used to correct installations of new technologies that have gone wrong". CAS agrees with the need for such a fund but to date no such monies have been made available, leaving landlords in the social rented sector facing unaffordable rectification costs and many consumers facing severe and ongoing detriment through no fault of their own. The National Public Energy Agency could serve a useful function in administering such a Fund on behalf of the Scottish Government, were the funding to be made available. The proposed Agency could also support local authorities and social landlords by offering expert advice about emerging or little-known technologies before installation (or signposting decision makers to the appropriate expertise), assist with procurement if needed, and help pursue redress if things go wrong. A West of Scotland CAB reports: Several clients came to CAB for assistance with fuel bills. Clients had had an infrared heating system installed by their housing association which the clients felt was not performing satisfactorily. The smart controls do not work, and the heat delivered is both inadequate for the needs of the property, and vastly more expensive that the system it replaced. One of the tenants reports winter weekly electricity costs of £59 against a heating demand that was projected to require an annualised average spend of just £16 per week, while another has reported costs more than 4 times projections. Severe issues with damp have developed due to properties being under-heated since the IR systems were installed, resulting in and/or exacerbating respiratory and mental health conditions, and damage both to tenants' property and the fabric of their home. In at least one case, penetrating dampness and defective or inappropriate cavity wall insulation appear to be exacerbating factors. Despite having been treated under the EESSH, the SAP rating of one of the properties was assessed in March 2019 as 20. This compares with the Scottish Government's 2020 target for the property type of a SAP rating of 623.

Question 5

Case Study and research details

Existing Homes Alliance Report

Oversightbody_FINAL-REPORT_Nov18.pdf (existinghomesalliancescotland.co.uk)

Energy Efficient Scotland – Options for National Oversight Body | The Existing Homes Alliance | Scotland (existinghomesalliancescotland.co.uk)

The Existing Homes Alliance report included a literature review covering global, European, UK and Scottish sources, and identified the various elements which will require oversight as part of a coherent energy efficiency and heat strategy. This is used to propose a detailed remit for a Scottish agency.

Proposed remit for a National Energy Agency

Enabling Frameworks National Energy Agency Role Immediate Tasks for the virtual agency

Statutory Targets

• Oversee and monitor progress against statutory targets on energy performance, heat decarbonisation, and as required targets related to fuel poverty and climate change
• Develop consistent systems for monitoring and evaluation across all delivery programmes which will measure progress on the ground.

Strategies

• Oversee delivery of the Heat in Buildings Strategy in its totality and relevant components of the Fuel Poverty Strategy, Climate Change Plan, and Energy Strategy
• Develop the Heat Decarbonisation Implementation Plan for Scotland (as per call for evidence)
• Regulation
• Oversee enforcement of regulation and standards and implementation of guidance (building standards, historic buildings, common areas, planning).
• Consider best use of regulation, standards and guidance going forward.
• Develop communications and engagement to raise awareness of forthcoming regulation and make the most of the foreshadow period.

Institutional arrangements

• Heat in Buildings Strategy
• Oversight of implementing agencies; budget requirements and spend
• Policy and programme development
• Review and revise strategies as required.
• Commissioning and evaluating programmes
• Develop the Heat Decarbonisation Implementation Plan for Scotland (as per call for evidence)
• Support for local authorities
• Oversight of measures to support local authorities to deliver programmes: provision of data, procurement and best practice guidance, facilitation of networking and partnership working
• Develop a heat networks accelerator programme which provides practical and financial support for local authorities and partners to develop heat network proposals.
• Collation and publication of progress being made by local authorities including case studies to provide wider confidence that action is being taken

Stakeholder engagement

• Liaison with stakeholders (energy suppliers, delivery bodies, professional institutions, trade bodies, academia, research organisations, third sector)
• Ensure the national implementation plan includes strong partnership approaches to delivery
• Supply chain
• Oversight of measures to improve skills, accreditation, quality assurance
• Co-ordinate programmes to stimulate the supply of skilled labour to match anticipated growth in demand working across the private, college, skills, business development and public sectors
• Research
• Support research and development (e.g. technology, behaviour change, engagement, finance)
• Immediate research and dissemination of the impact of Warmer Homes Scotland and Area-based Schemes including the performance of renewable installations
• Liaison with the private finance sector to develop new models for funding e.g. heat as service, collective purchase

Public engagement, advice, and protection

• Oversight of programmes to raise awareness and engage building owners, occupiers, and managers.
• Maintaining a single national point of consumer engagement, advice and support that can refer into local schemes and support – as delivered by Home Energy Scotland
• Oversight of programmes to maintain and enhance trust, consumer rights and redress e.g. complaints procedures
• Undertake a comprehensive analysis of the customer journey for different households including maximising post-installation performance.

Co-ordinating mechanisms

Governmental co-ordination

Lead and facilitate co-ordination:

• Intra-government - Energy/Climate Change, Housing, Health, Education
• Inter-government - UK, Scotland, local authority, devolved nations
• Coordination of relevant regulatory regimes
• Coordination of monitoring and reporting to Ministers and Parliament
• Ensure that the National Delivery Plan for the Heat in Buildings Strategy includes coordination actions across all levels of government.

The study concludes that a statutory Executive Non-Departmental Public Body (NDPB) is best suited to play this oversight role, as it is established by statute, facilitates parliamentary and stakeholder input, creating conditions which allow for long-term consensus on its powers, functions, and long-term objectives over successive administrations. It gives the agency more stability than those agencies established by framework agreements alone such as Executive Agencies. Ultimate responsibility for the agency should lie with the relevant Minister, ensuring it has the political leadership to drive through change.

The report includes the following case studies which will be of interest – a short summary of findings is given below:

Danish Energy Agency: The DEA is indeed a highly credible agency both at home and internationally. Additionally, the Energy Agreements and the political consensus surrounding these, help ensure adequate funding is delivered by successive administrations. Danish energy policy is also described as focused on synergies and integration across the various policy areas and objectives contained with the Energy Agreement.

Sustainable Energy Authority of Ireland: the SEAI engages effectively with public and private sector partners; is able to lever in private funding; and has well-defined specialisms across generation, supply, and use. Its long-term nature has allowed it to build expertise and reputation and it appears to be able to effectively feed in to policy and independent in its decision making. In order to access funding and lead collaboration, it has clear legally defined functions, with a remit broad enough to adapt to changing circumstances.

Another example that might be of interest is ADEME, the French Agency for Ecological Transition which has a broad remit on engagement with citizens and businesses on the transition to a low carbon society. across a wide range of sectors engagement, providing advice and financial support.

Finally, we recommend consulting with FEDARENE, the European Federation of Agencies and Regions for Energy and Environment for best practice examples. This is a European network of energy agencies and local/regional authorities which focus on energy policy and delivery.

Our work on our proposals for a national energy company and Scottish energy development agency included engaging with representatives of the Danish Government, and so we are aware that the Scottish Government has engaged with the Danes too. However, unlike our own work, we see no evidence that the Scottish Government has listened to them and understood their experience. This is particularly evident in the content of this consultation. Specifically regarding the design of an effective Agency, we would point to the work of Andy Cumbers and Commonweal which has called for a Scottish Energy Agency, modelled in part, on the Danish Energy Agency. Danish Energy Agency (DEA) role in supporting long-term energy planning through scenario-based analysis to scale up cost-efficient transformation of energy systems, identify challenges for both short term and long term targets with an emphasis on open, shareable models.

We are a long standing member of the European Energy Network (EnR) a voluntary network of 24 national energy agencies from EU member states and neighbour countries. We have strong relationships with these agencies and as such, if it would be useful, we would be happy to send out a request for specific information to EnR members and/or arrange short calls for Scottish Government officials with relevant EnR members to see if they have any relevant insight that could help inform the design of the new Agency.

rewiringamerica.org has resources on this. In particular see their "county by county" factsheet on the benefits of electrification/decarbonisation. This could be a potential template for resources provided by this agency? https://map.rewiringamerica.org/

Viken County Norway case study Energies | Free Full-Text | Moving Toward a Sustainable Energy System: A Case Study of Viken County of Norway (mdpi.com)

Nordic housing report see in particular page 57

"Building Affordable Homes: Challenges and Solutions in the Nordic Region" (diva-portal.org)

Case studies could include that of The Infrastructure Commission for Scotland and the delivery findings report on potential models for organisation and strategy. This includes examples from Australia and New Zealand and compares public-led bodies with independent models.

Reference to the 'Energising Advice' report: Postcode lottery in clean energy advice for consumers, reveals charity report — MCS Charitable Foundation

SFT provides an instructive case study of a public sector organisation set up with a delivery focus. SFT was established in 2008 as a company and an executive non-departmental public body of the Scottish Government. Its mission is to improve the efficiency and effectiveness of infrastructure investment in Scotland. It operates as a centre of infrastructure expertise, providing additional skills, resources and knowledge to public sector organisations, supporting them to plan, fund, deliver and manage their assets (primarily buildings, but also other infrastructure such as heat networks, and digital infrastructure). Such infrastructure promotes inclusive economic growth and societal benefits. Key elements of the corporate design of SFT that have promoted its effectiveness as a delivery-focused organisation, and which may therefore have relevance to the design of the Agency, include: - a clear organisational purpose – namely, "to improve the efficiency and effectiveness of infrastructure investment and use in Scotland by working collaboratively with public bodies and industry, leading to better value for money and providing the opportunity to maximise the investment in the fabric of Scotland and hence contribute to the Scottish Government's overarching purpose to increase inclusive economic growth". This purpose is reflected throughout the management and organisational structure: in SFT's corporate priorities (Place, Net Zero and Inclusive Economic Growth); its published 5-year Corporate Plan2 ; annual published Business Plan3 ; individual business objectives and workstream priorities. The Corporate Plan is aligned with the Scottish Government's National Performance Framework ("NPF"), recognising the role that infrastructure plays in supporting the outcomes identified in the NPF4 , including addressing the climate emergency (announced in 2019) and economic recovery following Covid; - clear set of responsibilities – SFT works between policy and delivery across all sectors, geographies and stages of infrastructure life-cycle, collaborating with Scotland's public and private sectors operational independence – SFT is established as a company, with separate legal entity, wholly owned by the Scottish Government. Its activity is overseen by the Minister for Business, Trade, Tourism and Enterprise. It operates under an approved 5 year Corporate Plan, and an annual Business Plan incorporating objectives discussed with Scottish Government sponsors. To be effective as a centre of expertise, SFT needs to be able to attract and retain specialist skills and experience across a range of disciplines. It has operational independence over its core budget, and is in a position to recruit at market rates from across the private and public sectors. It publishes an annual report covering financial and operational performance; and accountability for outcomes – SFT reports annually on the outcomes generated by the work it does, including economic, social and environmental. SFT does not deliver any outcomes itself, but by working in collaboration with other public and private sector organisations. In summary, SFT's clarity of purpose and remit, its organisational structure and governance arrangements, operational independence in relation to core budget, and control over how business objectives agreed with Scottish Government are delivered, each contribute to the effectiveness of the organisation in being able to work with others to deliver outcomes. In terms of limitations, whilst SFT uses its available resources to influence and improve infrastructure delivery, it is constrained insofar as it does not hold capital budgets, and hence cannot directly control infrastructure investment decisions, which are retained by project sponsors. This is the nature of an organisation operating as a centre of expertise.

The nuclear regulatory bodies in the USA and Canada

The United Kingdom's conversion from 'town gas' to 'natural gas' between 1968 and 1976 involved converting around 40 million appliances for 14 million customers, mostly households. Working alongside 12 regional gas boards, the Government took a central coordinating role, with a nationalised Gas Council giving the state direct control of the required investment.

Sweden's transition to district heating is another example which has enabled high security of supply, low carbon dioxide emissions, and efficient use of available heat sources.

We would also suggest the Scottish Government consider approaches taken by Efficiency Maine Trust2 , which has seen high recent rates of heat pump uptake across the State of Maine Efficiency Maine | Saving energy, reducing energy costs, and improving energy conservation

Given the interdependency between Scottish Government ambitions and local authority delivery, that the energy agency be jointly developed and governed. Scottish Government should also be working closely with COSLA to ensure joint accountability to both Scottish Ministers and local government.

Question 7

Danish Energy Agency

The DEA is indeed a highly credible agency both at home and internationally. Additionally, the Energy Agreements and the political consensus surrounding these, help ensure adequate funding is delivered by successive administrations. Danish energy policy is also described as focused on synergies and integration across the various policy areas and objectives contained with the Energy Agreement.

Sustainable Energy Authority of Ireland

the SEAI engages effectively with public and private sector partners; is able to lever in private funding; and has well-defined specialisms across generation, supply, and use. Its long-term nature has allowed it to build expertise and reputation and it appears to be able to effectively feed in to policy and independent in its decision making. In order to access funding and lead collaboration, it has clear legally defined functions, with a remit broad enough to adapt to changing circumstances.

ADEME, the French Agency for Ecological Transition

Has a broad remit on engagement with citizens and businesses on the transition to a low carbon society. across a wide range of sectors engagement, providing advice and financial support.

FEDARENE, the Federation of Agencies and Regions for Energy and Environment

This is a European network of energy agencies and local/regional authorities which focus on energy policy and delivery.

Forsyningstilsynet

Who are the regulator in Denmark, and publish the heat tariffs for circa 250 DH networks where this data is annually provided by the District Heating companies and published. The DEA have prepared a number of important guidance documents and including the Technology Catalogue providing a standard set of costs of equipment and this is used in conjunction with their published socio-economic model to demonstrate that DH zones are the best available technology through the District Heating Assessment Tool.

Evaluations of LHEES Phase 1, 2 & 3 pilot projects

Existing Homes Alliance

Explored many of the issues of relevant to this question in its Options for Oversight Arrangements for Energy Efficient Scotland report (2018)

Question 8

Effective

Canada – nuclear power station approval

Speeds up everything

Danish Heat Supply Act

Effective

This has facilitated a shift away for higher carbon heating systems whilst ensuring that there is no detriment to households

EU

No information specified

Europe

Experience across Europe is that municipal & community-led energy generation works best within a national network and that liberalisation of the network causes range of negative outcomes

Infrastructure Commission for Scotland reports

RoHS (Restriction of Hazardous Substances)

PAS 2035

To ensure best practice, although it has increased costs for improving building efficiency to the point it has had a negative impact on the necessary decarbonising programme

USA – nuclear power station approval

Speeds up everything

Vattenfall and Midlothian Council to plan and develop a district heating system in that area

They reflect that where heat networks are located on the cusp of several local authority boundaries there should be opportunities to coordinate across authorities in relation to planning, consenting, permitting and licensing of heat networks. This would ensure that district heating networks that cross boundaries are given the same standing by each local authority. For example, if a consent conveys utility powers on the network investor/operator then these powers would need to be recognised and accepted across the three authorities. The NPEA could take an oversight role in smoothing out these types of boundary issues, ensuring consistency across all local authority areas, and relating this to the LHEES for the area.

WEEE (Waste from electrical and electronic equipment)

https://www.seai.ie/publications/

Question 9

CAA (Civil Aviation Authority)

FCA, Hungarian Energy & Public Utility Authority, NatureScot, Ofgem and Ofcom, Scottish Information Commissioner

Which have a regulatory function but also provide advice to the public

France

Scandinavia

Scottish Fire & Rescue Service

Provide local operational advice but also have enforcement and investigatory role in relation to fire safety

Scottish local authority services including Environmental health, planning, waste management etc

Building standards, trading standards, environmental health, safety advisory groups

However, it was noted that it is an issue that a Building Standards Service has a conflict of interest where the Service acts as a Building Standards verifier and an Enforcing Authority

Scottish Water industry

Balance statutory powers for regulatory compliance alongside consumer advocacy role

Delivers Ministerial objectives and carries out project delivery.

SEPA

• Have advisory & regulatory role
• Balance statutory powers for regulatory compliance alongside consumer advocacy role
• Delivers Ministerial objectives and carries out project delivery.

Zero Waste Scotland

Development only body, at arms length, independent of government but created and funded by it. Entirely publicly funded but with a non-regulatory remit and with a policy and strategy enabling purpose.

Question 10

Case Studies / Research

Details

BEIS (Business, Energy & Industrial Strategy) Dept

E.g. in its Energy Innovation Programmes

Climate Change Committee with its Carbon Budget reports

COVID-driven examples (not specified)

Existing Home Alliance Research

Oversightbody_FINAL-REPORT_Nov18.pdf (existinghomesalliancescotland.co.uk)

The EHA 2018 report noted that "Any agency set up to provide oversight is more likely to be effective if it, and its functions are established by statute" because:

• It allows for the organisation's remit and functions to be debated and agreed in parliament and for stakeholder input which gives the Agency a firm foundation built on consensus.
• It gives greater political and budgetary autonomy than some other organisational types and has greater flexibility in its operations.
• It would have a stable and long-term future, as organisations established by statute are more difficult to wind up.

One potential limitation of a statutory body is that its functions could be defined too rigidly, which would limit its ability to adapt to changed circumstances. However, this limitation can be overcome by building in sufficient flexibility into the legislation (as was done for the Sustainable Energy Authority in Ireland). Such flexibility should be built into the legislatively defined functions of any such agency in Scotland as the net zero pathway is long and complicated and there will inevitably be a need for flexibility to continue to follow it over as yet unforeseen changes in technologies and circumstances.

Highlands and Islands Enterprise

Has significant strategic experience in not only the creation of subsidiaries or new organisations with specific remits for delivery, but also pertaining to the governance around their design

Infrastructure Commission for Scotland

OFGEM

Has powers in this area, albeit with clear division between the regulatory function and e-Serve.

Reference to the 'Energising Advice' report

Postcode lottery in clean energy advice for consumers, reveals charity report — MCS Charitable Foundation

Scottish Enterprise

Has experience in establishing and operating semi-independent delivery bodies which provide services within and beyond their geographic boundaries

Scottish Futures Trust

An example of a public sector body tasked with programme delivery functions that is not a statutory body (it is established as a company wholly owned by the Scottish Government and an executive non-departmental public body) and describes the key elements of its structure and governance that underpin its effectiveness.

SFT's clarity of purpose and remit, its organisational structure and governance arrangements, operational independence in relation to core budget, and control over how business objectives are achieved, each contribute to the effectiveness of the organisation in being able to work with others to deliver outcomes. In terms of limitations, whilst SFT uses its available resources to influence and improve infrastructure delivery, it is constrained insofar as it does not hold capital budgets, and hence cannot directly control infrastructure investment decisions, which are retained by project sponsors. This is the nature of an organisation operating as a centre of expertise. This illustrates that the establishment of the Agency on either a statutory or non-statutory footing, whilst an important consideration, is only one of a number of factors that will determine how effective the organisation is in practice.

Scottish Government's Building Standards Division

Recent work in developing a nationwide regulatory and information hub

SEPA

A good Scottish example of a statutory public sector body that has programme delivery functions

Smart Energy GB

Has experience of taking consumers on a journey to accepting new technologies in their homes – can share knowledge on community engagement, partnerships programmes and insight

The Scottish Water industry An example where a public provider operates alongside regulatory bodies / excellent case study

The Strategic Outline Case for Proposed Development of a National Delivery Mechanism report to Scottish Government (April 2019) Concluded that a statutory NDPB would be well-suited to the critical roles needed for an oversight body with the following strengths:

• It would provide capacity, support and expert advice to Local Authorities and the potential to acquire specialist technical resource to provide specific guidance
• It provides a strong central focal point for national-scale marketing, communication, and education services with an ability to establish a clear central brand.
• There is the potential to recruit specialists to support local level enforcement of regulations.
• It would provide a clear lead to supply chain players for supporting development, training, and expansion.
• It can recruit the right specialists to facilitate project finance (blending public and private investment) and to maintain an overview of the funding availability and allocations.

Trade Union- associated research

A number of reports and resources which highlight the opportunities and challenges associated with public sector delivery (or lack of public sector delivery) of energy, retrofitting and green jobs in Scotland.

STUC Energy Conference (2019) Policy Conferences - STUC

STUC (2020) Renewable_Jobs_Crisis_Covid-19.pdf (stuc.org.uk)

STUC (2021) STUC_Green_Jobs.pdf

STUC (2021) Our-Homes_briefing.pdf (stuc.org.uk)

UNISON (2021) 'Getting to net zero in UK public services: The road to decarbonisation' (unison.org.uk)

UNISON (2019) 'Power to the People' Microsoft Word - UNISONenergypublicownershipreport0619.docx

Commonweal (2019) The Common Home Plan - Common Weal

Reid Foundation (2013) 'Repossessing the Future' Repossessing.pdf (reidfoundation.scot)

UK-led Competitions and Markets Authority

Zoning coordinators

Could be an example in future as they will fulfil the role of both the coordinator of zoning designations as well as delivering capital programmes (although not on a statutory footing for the latter).

Question 11

Evidence and Research

Details

The Existing Homes Alliance – "Options for oversight arrangements for Energy Efficient Scotland report" [2018]

Explored many issues of relevance to the question

Strategic Policy Developments and Targets

Decarbonising Heat National Programme, established by Scottish Enterprise / decarbonisation of all energy use in buildings

To maximise the economic impact from Scottish Government heat and energy efficiency policies by working with company supply chains and other partners

Changes to the Climate Change Levy

E.g. costs, regulations, requirements

Partnering with other countries

E.g. Danish Embassy / DBDH

LHEES2

Assessing the effectiveness of the secondary legislation underpinning LHEES2

Housing 2040 commitments

Spell out relationship with the agency

Just Transition / fuel poverty outcomes

Prioritising the reduction of fuel poverty

Whole system view of home energy decarbonisation

Whether the agency should take a whole system view. For example, taking into account the relationship between home energy use and transport use (e.g. use of electricity from the home to charge an electric vehicle), and how water efficiency can help to reduce energy costs from hot water (as well as reducing wider water and energy system costs). To achieve Scotland's 2045 net zero target it may not be that an Agency focused entirely on heat and energy efficiency is a sufficiently holistic function for the new body.

Synergies between mitigation and adaptation actions

The Climate Change Committee has recommended that 'the Scottish Government must also take actions to improve Scotland's resilience to climate change by integrating adaptation into all Government policy'. In this context perhaps the Scottish Government should also be aware of the potential links between climate change mitigation and climate change adaptation activities in the buildings sector. Should, for example, the agency be responsible for or able to commission adaptation programmes in the buildings sector?

The interaction between the proposed energy standards as outlined within the Scottish Building Standards consultation and the proposed 2024 new building heat standard

Suggested that the Scottish Government review this: the primary concern is that once zero emission heating (at point of use) becomes mandatory in 2024, housebuilders will effectively have no option but to transition to air source heat pumps and solar will be lost from new homes.

Permitted development rights & building warrants

The current, outdated 50kW Permitted Development threshold is considerably reducing opportunities to deploy solar power in Scotland. Commercial-scale rooftop solar projects in England and Wales do not typically require full planning permission.

Wider industry / sector-led developments

New technologies (e.g. carbon capture / storage, heating and building fabrics, invention of lower net zero / reduced pollutant / environmentally friendly materials / insulation, smart meters, hydrogen alternatives)

Potential to maximise efficiency gains and further reduce emissions.

Unforeseen energy market developments (e.g. significant rise in energy costs due to volatile prices, changes to energy markets / pricing)

Show the benefits / cost effectiveness of zero carbon alternatives

Energy shift to a decentralised model Query about having a national one-size fits all approach

Linkages to microgeneration of energy in or on buildings

Disrepair issues / widespread disrepair in housing stock

Must be tackled prior to retrofit and zero emission heating. Queries as to agency role in tackling disrepair.

Directing the upgrading or replacement of existing district heating schemes fueled by non-renewable energy sources

Query as to agency role, and whether data on these has been collected, and how data will be used to direct this transition

Heat networks

Heat networks present a proven option to provide low carbon heat to a large number of buildings without putting the burden of upfront cost and decision making on the individual. The economics and technical feasibility have been proven for decades in other countries such as Denmark, Austria and Germany.

Question 13

Local authority working with Home Energy Scotland and CAS and other local services and partners

This ensured services provided complimented and supported one another with the common aim of tackling fuel poverty.

This approach has seen consistently high referral rates to both energy advice and energy related financial support from social housing providers. In addition, understanding of energy and fuel poverty issues for personnel within housing services has improved through dedicated training from these partners, enabling further support to tenants.

Area-based schemes, the LHEES pilots, and the community groups working on energy efficiency in partnership with Home Energy Scotland (many of which were funded through the Climate Challenge Fund) – for example Cosy Kingdom in Fife, South Seeds in Glasgow and LEAP in Lochwinnoch.

Establishing and operating semi-independent delivery bodies which provide services within and beyond our geographic boundaries.

These examples demonstrate that it is possible for an existing Government organisation to successfully manage major programmes of delivery.

Scottish Water working in partnership with SG

Maintains high quality water supplies, tackles flooding etc

Changeworks works in partnership with Local Authorities, EST, Scottish Government, the supply chain and social housing landlords for the delivery of EES:ABS schemes, decarbonisation funds and LHEES pilots

Transport Scotland's work to decarbonise transport in Scotland Work has touched on a wide variety of different areas, spanning across the transport sector. Examples include:

• Interest free loan funding for businesses and consumers to purchase electric vehicles and grants to allow them to install appropriate charging infrastructure.
  
• Advice and support for businesses and local authorities to understand how best to electrify their fleets.
  
• Free eBike trials available to organisations, which specifically targeted key workers during the covid-19 pandemic

• Grants and interest free loans for businesses, consumers, third sector organisations and public bodies to purchase eBikes, adapted cycles and eCargo Bikes.
  
• A pilot project offering funding specifically targeted at community transport organisations for the purchase of electric vehicles and installation of charge points.
  
• Specialist support for the taxi sector to encourage them to move to less polluting vehicles, along with grant support in line with the Low Emission Zones across cities in Scotland.

Energy Saving Trust as part of Active Travel Delivery Partnership (ATDP) including a range of organisations who are involved with delivering active travel on behalf of Transport Scotland

The group meets annually with the Cabinet Secretary and works together and with Transport Scotland to ensure a coherent and joined up approach across programmes and also enables best practice and ideas to be shared.

mPower research project looking at best practice examples in municipal energy across more than 100 public authorities across Europe –

Home Page - mPOWER (municipalpower.org)

National investment banks in various countries

By focusing on missions and clear targeting of support, have enabled genuinely inclusive growth. Strict conditionality and targeting of financial support is crucial, not simply address market failures or supporting vested interests.

Smart Energy GB

Refer to partnership details

Midlothian Council and Vattenfall (who have shared values)

In order to deliver their net zero target, and to enable their energy from waste partnership to utilise heat in nearby development. The shareholders in that partnership have wider obligations to work together on decarbonisation across the authority and this partnership is in its early stages but demonstrating that these areas of focus on district heating and wider decarbonisation can be achieved. The major success of this partnership is not through risk sharing, but through overall risk reduction. Where both parties contribute their skillset and positions to reduce the overall risk of investment.

National Parks Agencies

An example of a public body coordinating a broader delivery landscape to achieve a shared goal, which represent many different organisations within a defined geographical area, while also having regulatory powers.

NatureScot

Has powers over national park areas in terms of their planning and management. The NPEA need similar but more geographically extensive powers over the coordination, enforcement and communication of low carbon heat solutions.

Scottish Government investment in collaboration such as the Scottish Cities Alliance

Track record of unlocking success through this partnership would pave the way for a more substantive partnership to coordinate delivery.

Local area-based schemes, energy efficiency programmes; eg in areas including the Western Isles (Council and Tighean Innse Gall), Fife (Council and the Cosy Kingdom partnership), Argyll and Bute (Council and AliEnergy).

Brought about many productive and valuable local partnerships been local authorities.

Question 18

Examples and Insights

As highlighted previously, the gas transition in 1970s was hugely successful. The approach initially involved regional gas boards, before these were merged into British Gas. The lessons that can be drawn include the need for clear public sector vision and leadership, planning, financial resource, investment in the workforce, and engagement with communities through effective local democracy.

The Oil & Gas Authority (which is a GovCo) was initially part of a UK Gov Dept before vesting.

In professional engineering, the creation of prototypes, when feasible, is a very important strategy. Using an interim delivery body would not be exactly a prototype but would represent system planning for the structure of the Agency - and therefore would be a very appropriate strategy. The interim Agency would get to work on achieving the goals but, special attention would be given to structure and modus operandi at the formative stages.

This question moves the terminology from "virtual" to "interim". A more nuanced, and likely effective, approach would be to map out how the functions of the agency could be added and expanded over time, which could be illustrated in a Gantt chart to enable understanding and discussion.

Question 19

Examples and lessons to be learnt

As highlighted previously, the gas transition in 1970s was hugely successful. The approach initially involved regional gas boards, before these were merged into British Gas. The lessons that can be drawn include the need for clear public sector vision and leadership, planning, financial resource, investment in the workforce, and engagement with communities through effective local democracy.

The Existing Homes Alliance explored many of the issues of relevance to this question in its Options for oversight arrangements for Energy Efficient Scotland report [2018]

We have already cited the example of the Danish Energy Agency in delivering transformational change in decarbonising the Danish economy.

Possibly the most relevant example is the changes the GB electricity system that resulted from the 1926 Electricity Supplies Act as discussed in Section 4. The introduction of system planning transformed the management of the electricity system to become a model of best practice.

Consideration should perhaps be given to the approach taken by the Scottish Government within the housing sector, with a new requirement for local authorities to work in partnership with local housing, health and homeless partners to develop a Rapid Rehousing Transition Plan in 2019. Although not statutory, the new five year plans have required significant changes in the way services are delivered locally, how they are funded and new reporting requirements. Changes in remit and structure internally within the Scottish Government were also required to facilitate this shift.

SFT's involvement in the development of:

i) an outcome-based funding model for the Learning Estate Investment Programme; and

ii) the Net Zero Public Sector Buildings Standard, provide examples of how innovative approaches to the funding and delivery of public sector assets can result in a shift in the delivery landscape.

Learning Estate Investment Programme (LEIP)

In September 2019, Scottish Government & COSLA published their new Learning Estate Strategy, announced in tandem with the first phase of projects to benefit from funding through LEIP. To support the delivery of LEIP, SFT developed an outcomes-based funding approach. The approach, which was developed in conjunction with Scottish Government, COSLA and local authority representative groups, sees programme funding dependent on achieving a number of outcomes:

- new schools are built to a high quality and maintained in good condition for at least 25 years;

- in building the schools, construction firms create and support new jobs;

- connectivity targets are achieved to support digitally enabled learning and teaching, and advancements in technology; and

- ambitious energy efficiency targets are achieved over 25 years.

SFT used its technical and financial expertise to ensure that the outcomes and objectives sought are challenging but deliverable, particularly the in-use energy targets. SFT worked with the initial projects both directly and through collaborative workshops with local authorities. This helped to secure local authority buy-in at all levels to the outcomes-based funding model, and how the model could be used in the context of operational energy targets to improve building performance. By providing clarity around the outcomes to be delivered, a step change in approach has been achieved. The outcomes and objectives of the programme and funding model have now been agreed, providing a pipeline of work to industry exceeding £1bn.

Net Zero Public Sector Buildings Standard

SFT is now building on this experience in the use of operational energy targets to improve the performance of public buildings further. When planning a new building or refurbishing an existing property, during the design phase the building's energy performance is predicted. Often, when the building becomes operational, the actual energy performance is considerably worse than was forecast at the design stage. This is known as the 'energy performance gap'. SFT used its infrastructure, construction and low carbon expertise to set up a working group to tackle the issue. As this work developed, the initial concept grew and became known as the Standard. Recognising its contribution to supporting and delivering the net zero agenda, it was established as an action in the Scottish Government's 2019-20 Programme for Government. To establish the Standard, a Steering Group was formed by SFT, made up of representatives from across the public sector in Scotland, including Health Facilities Scotland, Zero Waste Scotland, Building Standards Division, the Scottish Funding Council and Chaired by the Scottish Government's Energy and Climate Change Directorate. The Steering Group's role was to provide governance, with the scope of the Standard expanded to include all building-related whole-life carbon, inclusive net zero economy outcomes as well as other indoor and outdoor environmental aspects. In March 2021, the Standard was adopted by the Scottish Government as the Net Zero Public Sector Buildings Standard - the world's first net zero standard developed and owned by a national government. The aim of the Standard is to provide the public sector with a framework to achieve exceptional energy and environmental performance in their new build and major refurbishment construction projects. It brings the Scottish Government's and other public bodies' own commitments to net zero deadlines into their projects' requirements, whilst also achieving excellence in other areas such as indoor environmental quality, biodiversity and construction embodied carbon. But more than that, the Standard will ensure the right buildings are built in the right place, that the opportunities for collaboration are maximised across the public sector and that these buildings also excel functionally, providing superb spaces for the public sector.

LEIP and the Net Zero Public Sector Buildings Standard are ongoing initiatives. Both demonstrate the benefits not just of innovation in the infrastructure delivery landscape, but also of a collaborative and multi-disciplinary approach, based on sustained engagement with project partners, external stakeholders and on the development of long-term, trusted relationships. Further details of these initiatives are available at SFT's outcomes website

Question 20

Key step / Considerations

EHA has published research in this area which will be of interest: The right frame of mind: Engagement for domestic energy efficiency in Scotland (2019)