Local heat and energy efficiency strategies and delivery plans: guidance

1. Local Heat and Energy Efficiency Strategies and Delivery Plans

The role of Local Heat and Energy Efficiency Strategies and Delivery Plans

1.1. Local Heat and Energy Efficiency Strategies (LHEES) are at the heart of a place based, locally-led and tailored approach to the heat transition. These local Strategies will underpin an area-based approach to heat and energy efficiency planning and delivery. LHEES Strategies will set out the long-term plan for decarbonising heat in buildings and improving their energy efficiency across an entire local authority area.

1.2. LHEES should be primarily driven by Scotland's statutory targets for greenhouse gas emissions reduction and fuel poverty:

• Net zero emissions by 2045 and 75% reduction by 2030.^[1]
• In 2040, as far as reasonably possible, no household in Scotland is in fuel poverty.^[2]

1.3. The LHEES Strategies should:

• set out how each segment of the building stock needs to change to meet national and local objectives, including achieving zero greenhouse gas emissions in the building sector, and the removal of poor energy efficiency as a driver of fuel poverty;
• identify strategic heat decarbonisation zones, and set out the principal opportunities and measures for reducing buildings emissions within each zone; and
• prioritise areas for delivery, against national and local priorities.

1.4. Accompanying the Strategies will be Delivery Plans, which will be developed in partnership with key stakeholders, and provide a strong basis for action for local communities, government, investors, developers and wider stakeholders, pinpointing areas for targeted intervention and early, low-regrets measures.

LHEES function and scope

1.5. LHEES should set out the long-term plan for decarbonising heat in buildings and improving their energy efficiency across an entire local authority area, framed around the following LHEES Considerations set out in Table 1 below. More detail on the LHEES Considerations can be found in Annex A – LHEES Considerations.

1.6. Local authorities should ensure that these Considerations are set out against their own local priorities and drivers for completing an LHEES, as well as the relevance for them. For example, it is acknowledged that not all local authorities have on- or off-gas properties. Additionally, depending on the focus for delivery, the LHEES Considerations should not be taken into account in isolation, and it may be worthwhile to combine analysis to consider more than one Consideration at a time.

Table 1: Summary of the LHEES Considerations

LHEES Considerations: Description

Heat decarbonisation

1 Off-gas grid buildings: Transitioning from heating oil and LPG in off-gas areas

2 On-gas grid buildings: On-gas grid heat decarbonisation

3 Heat networks: Decarbonisation with heat networks

Energy efficiency and other outcomes

4 Poor building energy efficiency: Poor building energy efficiency

5 Poor building energy efficiency as a driver for fuel poverty: Poor building energy efficiency as a driver for fuel poverty

6 Mixed-tenure, mixed-use and historic buildings: Mixed-tenure, mixed-use buildings, listed buildings, and buildings in conservation areas

1.7. Spatial zoning should be considered as part of LHEES. To support and differentiate between zones that support the Strategy and the Delivery Plan, two types of spatial zones are proposed; Strategic Zones (presented in the LHEES Strategy) and Delivery Areas (presented in the LHEES Delivery Plan, and in the LHEES Strategy, if strategically important for the local authority).

• Strategic Zones present a visualisation of the potential pathways to decarbonise the building stock at a local authority level. These could, for example, be split out by pre-defined geographical areas like intermediate zone or data zone (see Appendix B – Glossary for definitions) or they could cover a local authority's existing place-based activity or city-wide strategic development areas. They are useful to understand the baseline performance, the scale of potential and initial areas of focus, which could be used to inform Delivery Areas and follow on engagement.
• Delivery Areas are at a higher granularity than Strategic Zones. These spatial zones should set out clusters of buildings within a Strategic Zone or across the whole local authority that identify potential solution(s) at a delivery level. They will be an important starting point for identifying a range of projects, and actions that are within the competence of the Scottish Government, local authorities and wider partners (included as actions to be developed in the LHEES Delivery Plan). In practice and depending on the nature of Delivery Plan actions, a Delivery Area may comprise of streets or blocks, be a subset area of existing place-based or city-wide activity, or be centred around specific technology interventions.

1.8. The zones represent an important starting point for a range of policies and actions that are within the competence of the Scottish Government, local authorities and wider partners. They will be used to guide the design of policy levers, such as advice, funding programmes and regulation, which will give further direction and clarity to delivery routes and timescales. These may include any regulatory requirements to improve the energy performance of existing buildings or reduce emissions associated with their heat supply. Note however, the identification of Strategic Zones and Delivery Areas through the LHEES Strategies and Delivery Plans will be indicative and can be updated when required.

1.9. The scope of LHEES is focused on energy efficiency and heat decarbonisation. It does not extend to wider local energy system planning directly. However, the production of an LHEES will not preclude local authorities undertaking wider local energy planning. LHEES should be an important building block for wider local energy planning and where deemed applicable, this should be taken into account during its development.

1.10. The UK Government will take decisions on the role of hydrogen in the Great Britain gas network from 2026. This does not prevent local authorities from considering the strategic role hydrogen may play, as part of their LHEES.

1.11. LHEES should:

• Be evidence based;
• Cover the full building stock within the local authority, including the domestic and non-domestic sectors, so far as reasonably possible;
• Be developed in collaboration with stakeholders;
• Be a corporate document, agreed and supported by all relevant local authority departments;
• Be linked to any previous LHEES^[3] to show progress achieved against outcomes and to carry forward outstanding actions, as appropriate;
• Demonstrate how it supports equality and addresses inequality;
• Be developed using extensive and inclusive engagement and consultation;
• Be forward looking;
• Be delivery focussed, working towards local, regional and national targets;
• Be clear, concise and easy to read;
• Be open and transparent regarding the data used, and its associated limitations in terms of scope, accuracy and coverage;
• Be continuously reviewed with progress monitored through the Delivery Plan.
• Be consistent with the abbreviations and terms set out in Annex B - Glossary.

Heat in Buildings Strategy

1.12. The Heat in Buildings Strategy^[4] outlines the steps the Scottish Government will take to reduce greenhouse gas emissions from Scotland's homes, workplaces and community buildings and to ensure that poor energy performance is removed as a driver of fuel poverty. The focus of the Strategy is on energy demand for space and water heating in homes, workplaces and community buildings.

1.13. In addition to Scotland's statutory targets for greenhouse gas emissions reduction and fuel poverty (as referenced above in paragraph 1.2), LHEES should reflect the following objectives to the pathway for net zero, as set out in the Heat in Buildings Strategy:

• By 2045 our homes and buildings no longer contributing to climate change, as part of the wider just transition to net zero.
• By 2033 all homes have the equivalent of EPC C where technically and legally feasible and cost effective.^[5]
• By 2025 all private rented sector homes to reach a minimum standard equivalent to EPC C, where technically feasible and cost-effective,^[5] at change of tenancy, with a backstop of 2028 for all remaining existing properties.
• By 2030 the large majority of buildings achieve a good standard of energy efficiency.
• By 2030 emissions from buildings have to be 68% lower than 2020 levels, which requires zero emissions heating in:
  • The vast majority of 170,000 off-gas Fossil fuel heated homes
  • At least 1 million on-gas homes
  • The equivalent of 50,000 non-domestic buildings

Guidance overview

1.14. The aim of this guidance is to set out the production and content requirements for a local authority to prepare a Local Heat and Energy Efficiency Strategy and Delivery Plan.

1.15. Its purpose is to ensure that a Local Heat and Energy Efficiency Strategy and Delivery Plan contain outcomes and actions that are backed up by robust data and analysis, supported by stakeholder engagement, and that are linked to national and local priorities, plans and targets.

1.16. The requirements that the Scottish Government would expect to see addressed in Local Heat and Energy Efficiency Strategies and Delivery Plans are highlighted throughout this guidance.

1.17. LHEES is likely to evolve as the Scottish Government introduces future standards and regulation, as well as new delivery and funding programmes. This guidance is framed around what can be delivered now given the existing and known policy landscape, and sets out requirements for the first iteration of LHEES published by the end of 2023.

1.18. Completion of LHEES Strategies and Delivery Plans by each local authority will support the Scottish Government to understand further the national landscape for the delivery of heat decarbonisation and where there are potential gaps to support the needs and aspirations of local authorities. It should also help to ensure that local authorities are supporting actors delivering changes to buildings and local infrastructure at a suitable rate to help achieve national targets as set out in the Heat in Buildings Strategy, and that there is a level of standardisation and consistency between local authority LHEES Strategies and Delivery Plans.

1.19. The Scottish Government have also provided an LHEES Methodology to local authorities. This is a more detailed, step by step approach, including models, tools and templates, and represents best practice in how to produce an LHEES. The execution of this methodology alone is not expected to ensure the delivery of a full LHEES. However, it does provide a strong foundation for the local authority with respect to the coordination and technical roles required of LHEES, which local authorities can modify and advance to suit their own preferences and local context. Local authorities are not required to use the methodology and are welcome to take alternative approaches to meet the requirements set out in this guidance. Please contact LHEES@gov.scot for the latest version of the LHEES Methodology.