Local Housing Strategy: guidance 2019

11. Fuel Poverty, Energy Efficiency & Climate Change

11.1 Housing has a vital role to play in meeting our ambitions for ending fuel poverty and tackling the effects of climate change. Addressing fuel poverty and climate change are key priorities for Scottish Ministers to help mitigate the impact of climate change on the environment and address economic and health inequalities.

11.2 In developing a LHS, local authorities should be fully aware of what the existing Fuel Poverty, Energy Efficiency and Climate Changes targets are and these should be reflected in LHS priorities and outcomes. The Scottish Government has proposed the introduction of Local Heat and Energy Efficiency Strategies (LHEES) and piloted LHEES with 23 local authorities to date. The overlap between proposals for LHEES and LHS have been highlighted in Heat and Energy Efficiency Strategies: Second Consultation Analysis. Local authorities should be aware that any change to LHS content (relating to development of proposals around LHEES) will be advised separately, at the appropriate time.

11.3 LHEES as proposed offers the link between Scottish Government targets and policies and the actual delivery of energy efficiency and heat decarbonisation, which will allow local authorities to prioritise and target programmes over a 20 year period, aligning cross sector activity and providing valuable information to the supply chain.

11.4 Local authorities have a significant part to play in ensuring that people are able to live in warm, dry, energy efficient, low carbon homes which they can afford to heat. The LHS guidance should be read in conjunction with the Sustainable Housing: Fuel Poverty and Climate Change Advice Note and local authorities should be aware that this advice note will be updated once all elements of the new definition as set out in the Fuel Poverty (Targets, Definition, and Strategy) Act 2019 are in force.

11.5 Some local authorities have been piloting different approaches for Local Heat & Energy Efficiency Strategies, which may influence its approach to accelerate the rate of energy efficiency improvement in the owner-occupied, social housing and private-rented sectors, as well as tackling fuel poverty.

- Fuel Poverty & Energy Efficiency

11.6 The Fuel Poverty The Fuel Poverty (Targets, Definition, and Strategy) (Scotland) Act 2019 introduces a new statutory target for reducing fuel poverty that by 2040, as far as reasonably possible, no household, in any Local Authority area, in Scotland is in fuel poverty and, in any event, no more than 5% of households, in any Local Authority areas, in Scotland are in fuel poverty; no more than 1% of households in Scotland are in extreme fuel poverty; and the median fuel poverty gap of households in fuel poverty in Scotland is no more than £250 in 2015 prices before adding inflation.

11.7 The Act introduces a new definition of fuel poverty (summarised in paragraph 2.3 above) which will:

• Focus on low income households by introducing a new minimum income threshold which will be 90% of the UK Minimum Income Standard (MIS) after housing, fuel costs, benefits received for a care need or disability (if any) and the household’s childcare costs are deducted (there will be an additional uplift for remote rural, remote small towns and one for islands); and
• Help to better target resources at those who are most in need of support, no matter where they live in Scotland; and
• Places a duty on Ministers to introduce a Fuel Poverty Strategy setting out how the target will be achieved.

11.8 Until all of the elements of the new definition are in effect, including the enhanced heating regime and the remote rural, remote small town, and island uplift and in place then existing arrangements should continue to be used.

11.9 The Scottish Government’s Energy Efficient Scotland Route Map sets out the journey that homes, businesses and public buildings will take to become more energy efficient. It outlines the support available from the Scottish Government to help owners transform their properties and proposes minimum energy efficiency standards for the private and social rented sectors by 2030.

11.10 An updated Route Map is planned for publication in late 2019. This will be accompanied with a publication of a consultation on energy efficiency standards in owner occupied housing.

11.11 The draft fuel poverty strategy sets out the policy development of the Fuel Poverty (Targets, Definition and Strategy) (Scotland) Bill and the draft Fuel Poverty Strategy for Scotland 2018.

11.12 The LHS should set out by location, the scale and nature of fuel poverty in its area, as well as the type and number of households it considers to be the most vulnerable and how action to address the needs of these households is being prioritised. The LHS should set out the work that is being done locally to ensure, that across all tenures, “so far as reasonably practicable, persons do not live in fuel poverty.”

11.13 The LHS should recognise the impact living in a cold home has on the health and wellbeing of individuals and set out the action that is being taken to address the scale of fuel poverty in the area and how improvement is being measured, including in respect of health inequalities.

- Climate Change

11.14 The Climate Change (Scotland) Act 2009 created a statutory framework for reducing Scottish greenhouse gas emissions by at least 80% by 2050. In order to achieve Scotland’s climate change targets, concerted and co-ordinated action is required across the public and private sectors and at individual and community level.

11.15 As of August 2019, a new Climate Change Bill is currently going through the Scottish Parliament, with increased target ambition in response to the UN Paris Agreement. Following advice from the UK Committee on Climate Change in May 2019, the Scottish Government acted immediately with amendments to the Bill to set a net-zero greenhouse gas emissions target for 2045. This will ensure that Scotland’s contribution to climate change will end, definitively, within a generation. The Scottish Government has committed to updating the current Climate Change Plan, which sets out policies and proposals to meet emissions reduction targets over the period to 2032, within six months of the Bill receiving Royal Assent.

11.16 The Climate Change Bill also includes the following targets:

• 90% reduction in greenhouse gas emissions by 2040 (measured against 1990 levels);
• 70% reduction in greenhouse gas emissions by 2030 (measured against 1990 levels).

11.17 Section 44 of the 2009 Act requires public bodies in exercising its functions, to act in a way that is most sustainable and:

• Best calculated to contribute to the delivery of the Act’s emission reduction targets;
• Best calculated to deliver statutory adaptation programmes.

11.18 Section 46 of the 2009 Act requires public bodies classified as “major players” to publish annual climate change reports. The type of data required and format of reporting is described in more detail in secondary legislation (The Climate Change (Duties of Public Bodies: Reporting Requirements) (Scotland) Order 2015), which is currently under a review.

11.19 A household’s greenhouse gas emissions are influenced by:

• Property Condition - houses in disrepair are harder to keep warm and therefore use more energy.
• Energy Efficiency - energy inefficient houses use more energy to heat than more efficient properties. Insulation of lofts/roofs, walls, floors, pipework, more efficient windows, draught proofing and better heating controls can all improve the efficiency of a property or the ability of a household to only use energy when it is needed. The age and maintenance of heating devices, such as gas boilers also affects their efficiency and emissions levels. The properties with the poorest energy efficiency ratings (EPC G & F) should be improved urgently.
• Fuel - the type of fuel used in a property can affect its greenhouse gas emissions. Oil fuelled heating has higher emissions than gas, whilst low-carbon or renewable heat sources, e.g. heat pumps, biomass, solar thermal, have even lower carbon emissions. To achieve net zero greenhouse gas emissions it is likely that fossil fuels will have a severely reduced role in space and water heating in future.
• Individuals Behaviour - the way people use and run their homes affects carbon emissions, e.g. inefficient use of a heating thermostat/programmer, using unnecessary lighting.

11.20 The Heat Generation Policy Statement published in 2015 set out the approach to deliver an affordable and effective heating and cooling framework to 2050. In light of the new targets in the Climate Change Bill, the Scottish Government has committed to publishing a draft Heat Decarbonisation Policy Statement, including actions by Summer 2020. Additionally a call for evidence on the future of low carbon heat for off gas buildings took place March – June 2019.

11.21 Adapting to climate change means making adjustments to economic, social and natural systems to help limit the harmful consequences of climate change and make the most of available opportunities. The UK Climate Change Risk Assessment and Scottish Evidence Report provides a regular assessment of the threats and opportunities facing Scotland and the UK and there is a statutory requirement to prepare an adaptation programme in response to the CCRA and to monitor progress.

11.22 The first Scottish Government Climate Change Adaptation Programme provided a solid foundation for further progress with awareness-raising, knowledge-sharing and pilot projects and helped to develop a distinctive Scottish place-based partnership approach.

11.23 The second Climate Change Adaptation Programme is currently being developed and contains a vision whereby we live in a Scotland where our built and natural places, supporting infrastructure, economy and society are climate ready, adaptable and resilient to climate change. It contains a set of seven high level “outcomes” for the Programme and is being designed to deliver a step change in collaboration, and emphasise the wider co-benefits of climate action. This is expected to be published in late 2019.

11.24 The LHS should demonstrate links between climate change and housing and fuel poverty policies.

Areas that the Scottish Government would expect to see addressed in each LHS:

a) Demonstrate that appropriate links have been made between fuel poverty, energy efficiency, achieving heat decarbonisation and climate change and other policy areas such as house condition (including Below Tolerable Standard).

b) A summary of any programmes or actions arising from any LHEES pilot project (and any Local Energy Plan) including an explanation around how these has influenced the development of climate change, energy efficiency, and/or fuel poverty policies.

c) Demonstration of an understanding of how a changing climate may affect the housing stock and level of vulnerability of different groups. The identified threats and opportunities of climate change and what the local authority is doing to manage risks and respond to opportunities.

d) A summary demonstrating the local authority’s understanding of national fuel poverty priorities and targets.

e) A description of fuel poverty locally with the:

• Extent, location and nature of fuel poverty fully demonstrated;
• Causes of local fuel poverty explained, how these might differ from national trends and the action being taken to address the identified causes.

f) A summary demonstrating the local authority has an understanding of technology options available to deliver in the local authority area to achieving national net zero greenhouse emissions targets.

g) An explanation around how available resources are being used effectively to tackle fuel poverty and accelerate the rate of energy efficiency improvements and uptake of low/zero carbon heat across all tenures, including increasing the number of householders and property owners that benefit from support from fuel poverty and energy efficiency/decarbonisation programmes.

h) Robust fuel poverty and greenhouse gas emissions outcomes with local targets and indicators to measure progress in support of the Scottish Government fuel poverty and climate change targets, including through local delivery of the Home Energy Efficiency Programme Scotland: Area Based Schemes (HEEPS: ABS).