Local energy policy statement

2.2 Scotland's Islands

The implementation of the National Islands Plan will build on and align, with Scotland's wider climate change commitments, policies and strategies, as well as with existing energy related schemes.

To complement the National Islands Plan, and to ensure the continuing energy resilience of our Islands, we will develop a Scottish Islands Energy Strategy to support them in their journey to decarbonisation and publish in 2021. 

Scotland's Islands

Our islands can be at the forefront of the transition to low carbon energy. 

The introduction of climate change adaptation and mitigation measures, whether increased revenue for island communities through renewable energy projects or the protection, recovery, restoration or enhancement of natural carbon stores (on land or in the sea) or the introduction of solutions to combat coastal erosion, can have a direct, positive effect on the local economy and environment. 

2.3 More change and choices

Scotland has a strong track record of delivering renewable electricity, predominantly in rural and island areas. In the first half of 2020, Scotland generated 17.5 TWh of renewable electricity, up 16.6% on the same point in 2019, and is the equivalent of almost three quarters of Scotland's annual electricity consumption.  Increases in rainfall and wind speed in Q1 2020 contributed to this - compared to the first half of 2019, onshore wind generation is up 13.4%, offshore wind generation is up 25.0% and hydro generation increased by 32.5%.

The change from fossil fuel generation to renewable generation has, for the majority of people, not had an impact on how they interact with the energy system where they live or work as the energy generated has gone directly into the grid. 

However, as part of the transition towards sustainable, localised sources of energy (including for heat and transport), it is likely that people will be exposed to greater system changes and choices.  

Case Study: Heat Smart Orkney

The Heat Smart Orkney project was set up to establish and show how smart controls and local rebating can be used as a way of both mitigating the effects of curtailment on the Rousay, Egilsay & Wyre (REW) community wind turbine while also addressing the issue of fuel poverty in Orkney. 

Supported with £1.25 million from the Scottish Government's Local Energy Challenge Fund, the project works by diverting unused renewable energy into affordable heating, and is activated when the REW turbine is curtailed.  

Smart storage heaters, flow boilers, hot water cylinders and immersion heaters are installed into participating homes as secondary heating devices, and these are switched on when a signal is sent from the turbine, via a cloud based platform to control equipment attached to each device – saving costs for individual householders.

Rather than watching the community turbine be turned off when the wind picks up, the community will be able to watch it continue to turn, knowing that local people are receiving cheap, green heat.

To reach our commitment to net zero by 2045^[10], it will be crucial that we all actively consider how to decarbonise the whole energy system (electricity, heat and transport). Alongside this, energy providers will have responsibility to ensure they are providing reliable, resilient, and affordable energy for the people of Scotland. 

2.4 Strategic Approaches   

The Scottish Government is committed to developing strategic approaches, based on locally distinctive needs, opportunity and priorities.  An example is our "Place Principle" approach.  The cores values such as, collaboration, integration and community involvement are equally relevant to planning and developing local energy projects.

Place Principle

The Scottish Government, in collaboration with the Convention of Scottish Local Authorities (CoSLA), have agreed to adopt the "Place Principle"^[11]. The Place Principle provides a shared understanding of place, it helps overcome organisational and sectoral boundaries, encourages better collaboration and community involvement, and improves the impact of our combined resources and investment. 

It is a common sense approach, providing a collective focus to support inclusive and sustainable economic growth, while creating places which are both successful and sustainable. 

Implementation of the Place Principle requires a more joined up, integrated, collaborative and participative approach to decisions about services, land and buildings. It understands that, to maximise the positive impact of combined resources, each party involved must work better together, so that the whole is greater than the sum of its parts. 

2.5 Local energy planning approach

When referring to local energy planning there is no single approach, each one is specific to an organisation's particular purpose, for example:  

• Focus on a specific energy service (heating in buildings) or cutting across different services (e.g. including EV charging).
• Focus on network planning. 
• Focus on coordinating delivery of wider changes to local energy services.
• Driven by public authorities, commercial organisations or community groups.
• Local strategies produced for all of Scotland, or voluntarily for specific places.

This was highlighted in the consultation feedback, with a request for more clarity. The Scottish Government will provide further guidance on "local energy planning" to support and inform decision-making at a local level, and this is included in the Delivery Framework.  

2.6 Scottish Government's Priority for statutory local energy planning. 

The Scottish Government's priority will be focused on where we have devolved powers in heat and energy efficiency.  As such, Local Heat and Energy Efficiency Strategies (LHEES) will be the foundation of local energy planning.  LHEES will set out the long-term strategic plan for each local authority area for heat decarbonisation and energy efficiency, tailored to local circumstances. They will support engagement across multiple stakeholders including individuals, business owners, community groups, and energy network operators.

We are proposing that the production of LHEES should be a statutory duty of local authorities. This will ensure planning takes place consistently and the benefits are felt across Scotland. We will work with local government partners to develop this statutory duty. We think the scope of the LHEES duty should focus on energy efficiency and heating in buildings rather than the full range of local energy issues.  In part this reflects our devolved powers over heat and energy efficiency. But it also reflects the close coupling of energy efficiency and heating technologies in local strategies and delivery activities.  

We have funded LHEES pilots in all local authority areas across Scotland. This will inform our work going forward.  A summary of LHEES activity to-date, and future activity is summarised below.  This work will be progressed and agreed in collaboration with local government partners. 

Local Heat and Energy Efficiency Strategies (LHEES)

LHEES Pilots

The Scottish Government has been working with all local authorities in Scotland to pilot different approaches and methodologies for LHEES, at a smaller scale, focusing on specific places, or particular segments of the building stock.

Shared Understanding

As we take steps to introduce a statutory duty, we will work with local government partners to reach a shared understanding, which will form the basis of our approach. 

Tools and Resources

In collaboration with local authorities and delivery partners, we will develop the tools, methods and other resources that will support each local authority to construct their LHEES. 

Long-term V short term 

LHEES need to take into account the long term changes to the building stock needed to meet national targets (including fuel poverty targets), as well as setting out near term actions that will be taken to make progress.  

To ensure these two aspects are integrated into a LHEES, we are proposing each LHEES comprises of (1) a Strategy and (2) a Delivery Plan.

LHEES Strategy

Purpose: To set out the long-term plan for heat decarbonisation and energy efficiency in the local authority area. 

Key elements:

• Show how each segment of the building stock needs to change to meet national objectives, including achieving net zero greenhouse gas emissions in the building sector, and the removal of poor energy efficiency as a driver of fuel poverty. 
• Generation of spatial zones which local authorities and the Scottish Government will use as an evidence base for delivery through Energy Efficient Scotland and other programmes.
• Take account of local policies and priorities in shaping Strategies, ensuring proposed upgrades to the building stock are aligned with local issues. 
• Function as the backbone of the LHEES, establishing a shared understanding across stakeholders as to what energy efficiency and low carbon heating installations will be needed across the local area and on what timescales. 
• This would support coordinated action and send clear investment signals across supply chains and to infrastructure providers. 

LHEES Delivery Plan

Purpose: To set out how local authorities, their partners, and the Scottish Government propose the Strategy be delivered over a 3-5 year period.

Key elements

• Clarify and agree the roles and responsibilities that local authorities and the Scottish Government will share in delivering actions in the Zones.  
• Build on existing documents, such as existing area based scheme plans (e.g. HEEPS: ABS), as far as possible.  
• Initial LHEES would focus on off-gas grid areas, heat networks in urban areas, as well as identifying areas in which building owners acting in concert would be the most effective way to reduce emissions caused by heating (e.g. works in conservation areas or implementing solutions for multi-tenure buildings). 

However, the Scottish Government does not want to limit ambition, if there is an appetite to extend local energy planning beyond heating and energy efficiency.  Some local authorities are already looking to use LHEES as the foundation of local energy planning with a wider scope, for example including transport or local power generation. The decision on whether to undertake this, alongside the potential statutory minimum requirement under LHEES, is one for local stakeholders to take.  

2.7 Wider climate change ambitions

The Scottish Government has supported a number of local energy demonstrator projects.  However, these have tended to be undertaken in isolation and did not take into account the wider energy systems in which the project was based. 

In our journey to net zero, we need to take a more strategic overview, covering larger geographical areas, and involving partnership arrangements at the delivery level between local communities, energy network companies, local authorities, the public, and private sector. 

LHEES and, where applicable, other local energy plans, will be a key building block to achieving that aim - and, strategically, individual local area plans should interact with other plans in neighbouring/ nearby areas.  For example, this could mean encouraging greater collaboration between local communities, local authorities, and housing developers/ builders to ensure new developments are created with long-term energy planning in mind that delivers for the net zero ambition.

We Will

• To include a requirement in the next CARES contract, which starts on 1 April 2021, to establish a knowledge sharing portal, which will showcase relevant and current best practice. 
• Develop, in partnership with others, an understanding of what local energy planning means, how it complements or augments LHEES, and produce guidance on local energy planning, as part of our suite of existing Good Practice Principles.  
• Work in partnership with Local Authorities in the delivery of LHEES to ensure successful implementation. 
• We will publish a Scottish Islands Energy Strategy document.