Low Carbon Infrastructure Transition Programme (LCITP): call for evidence

Chapter 3 Scale of Challenge and Barriers to Delivery

3.1 As the current LCITP programme draws to a close in 2021, we must now consider how its successor can become the primary mechanism for deploying low and zero carbon heat at scale, co-ordinating our support for the roll-out of heat networks and heat decarbonisation infrastructure. Our future programme must effectively blend government support, including newer financial mechanisms such as the Green Growth Acceleratorand the Scottish National Investment Bank with co-funding from the private sector to deliver our ambitious emissions reduction targets whilst delivering value for money and future financial sustainability.

3.2 As set out in in the draft Heat in Buildings Strategy, by 2045 emissions from heating our homes and buildings will have all but disappeared, with demand for energy reduced and space and water heating provided by zero emissions alternatives. In order to meet our interim climate targets and ensure long-term delivery of our net-zero objectives by 2030, we must rapidly scale up deployment of zero-emissions heating systems, such as heat pumps and heat networks, more than doubling installations each year so that by 2030 over 1 million homes and around 50,000 non-domestic buildings are converted to use these systems.

3.3 Whilst a growing share of Scotland's heat is met from low carbon and renewable sources, there remain a number of barriers to upscaling deployment and achieving our net-zero objectives. These barriers include:

• Innovative, untested technology with capacity constraints in design and construction, operations and maintenance services;
• Contractual challenges in delivering agreements across complex customer and supply chains;
• Lack of project skills, capacity and risk management experience to deliver complex energy systems;
• Commerciality of business models linked to revenue and demand risk, along with challenges accessing capital investment;
• Lack of consumer and supply chain knowledge and trust of low carbon energy technologies;
• The relatively high upfront costs of installing low carbon heat systems, relative to like-for-like replacement of incumbent fossil fuel systems.

Low Carbon Infrastructure Transition Programme Case Study 2

North Glasgow Homes Air Source Heat Pump Project

North Glasgow Homes received £4.5 million in funding from the LCITP to install communal air source heat pumps on the roofs of six high rise properties in Springburn, Glasgow.

The project aims to deliver both a reduction in carbon emissions and economic savings to social housing tenants. Integral to this project is the development of a data tool that will help provide invaluable learnings on the way heat is being used in this type of housing. The scheme will support the decarbonisation of heat in Scotland, and provide an exemplar project for other social landlords.

Questions

3. Do you agree with the barriers outlined above? Please explain your views.

4. Are there additional barriers to low and zero carbon heat project delivery? Please explain your views.

5. What role should the new programme play in addressing challenges and barriers? Please explain your views.