Heat and energy efficiency strategies: second consultation analysis

Assessing Impact

Equality

292. The consultation paper noted that the Scottish Government is keen to include measures to protect groups such as the elderly or disabled from being exploited, and that people with protected characteristics have an equal opportunity to be included in proposals around socio-economic assessment as part of LHEES and district heating schemes.

Question 23 Please tell us about any potential impacts, either positive or negative, you feel our proposed approach may have on particular groups of people, with reference to the ‘protected characteristics’ listed above.

293. Twenty-six respondents, across all sub-groups, responded to this question.

294. The key theme emerging was agreement with the proposals towards protecting groups of people who may be more vulnerable to the impact of fuel poverty or agreement that it is essential to consider vulnerable customers and protect them from the negative aspects of district heating. A small number of respondents, primarily in the local government sector simply noted that the proposed approach should lead to positive impacts.

295. Only a very small number of respondents cited any potential negative impacts; these included the need to consider the lack of consumer choice or that there could be difficulties in selling the idea of a new heating system and disruption to some vulnerable individuals.

296. A small number of respondents in the local government sub-group referred to the need to consider how to communicate and engage with consumers and with any groups affected by SEEP and the rollout of LHEES, with a public sector organisation noting the importance of promoting this well.

297. Other issues raised by very small numbers of respondents included:

• Governance arrangements for SEEP including the LHEES programme need to include specific ongoing assurance arrangements on equalities and human rights issues.
• Any guidance that is produced needs to be in line with existing guidance on equalities and human rights so as to reduce the potential for duplication and support integrated approaches.
• There is a need for robust socio-economic assessments to ensure that connection to a district heating network does not have a negative impact.
• Suppliers will need to demonstrate they have robust processes in place to safeguard individuals with protected characteristics.
• Some individuals in protected groups are less likely to invest in energy efficiency measures.
• A need for an independent Energy Agency to set and enforce standards to help deliver socio-economic benefits as well as reducing carbon emissions.
• Any developments should be subject to the current planning process.

298. Question 24 then went on to ask a series of 5 questions about special provisions or measures that should be considered to ensure protected characteristics are taken into account. Relatively small numbers of respondents answered these questions and many reiterated the same point at each question, so the following paragraphs provide a summary of comments made in response to these questions.

Question 24a Are there any special provisions / measures we should consider / make / include to ensure protected characteristics are taken account of in the LHEES? In your opinion, should the LHEES process specifically include / address the protected characteristics?

Question 24b Are there any special provisions / measures we should consider / make / include to ensure protected characteristics are taken account of in the socio-economic assessment? In your opinion, should that process specifically include / address the protected characteristics?

Question 24c Are there any special provisions / measures we should consider / make / include in terms of the installation of networks in order to minimise disruption to people with mobility problems or any other protected characteristic?

Question 24d Are there any special provisions / measures we should consider / make / include in terms of consumer protection, that would better assist in ensuring that people with protected characteristics will be safeguarded (taking account of our limited legislative competence in this area?

Question 24e Are there any special provisions / measures we should consider / make / include in terms of communications, that would better assist in ensuring that people with protected characteristics will be kept informed and can fully participate?

299. Across these five questions, respondents noted the need to ensure that protected characteristics should be included and addressed in LHEES, that developing strong consumer protection will ensure that vulnerable groups are protected and that there should be no barriers with anyone wishing to engage. A key theme was agreement that protected characteristics are taken account of in the socio-economic assessment, albeit that some respondents also noted that they must be based on a robust evidence base.

300. Respondents referred to the need to ensure training is offered to individuals involved in LHEES so that they can deal appropriately with groups of individuals with protected characteristics. Allied to this, there were some calls for appropriate guidance and examples of best practice to be provided.

301. Communication with individuals with protected characteristics is seen as being important and there were suggestions for a wide ranging engagement process to involve a wide range of individuals. The need to offer information via a range of different channels and taking into account specific needs was a key theme emerging. There were also some suggestions of the need to ensure that representative groups and community organisations are included in any engagement activities. A wide range of communication platforms were suggested and included outreach engagement via community and representative organisations, libraries and shopping centres. There were also some calls for clear literature in various forms such as pamphlets or newsletters, along with the potential to use social media.

302. In relation to the installation of networks, there was broad agreement that this should adhere to considerate construction in terms of minimising disruption; and that advance notice should be given to customers.

303. In terms of ensuring that people with protected characteristics will be safeguarded, a small number of respondents suggested that projects should be encouraged to apply for membership of the Heat Trust or that suppliers need to demonstrate they have robust processes in place to safeguard individuals with protected characteristics. There was a suggestion that there should be alignment with existing standards in other regulated utility markets.

304. There were a small number of suggestions for suppliers to keep registers of vulnerable customers so that they can communicate the assistance and protection available to those who will need it. One respondent suggested the maintenance of one register across all utilities rather than separate registers being maintained by each supplier.

305. There were a small number of comments that existing legislation already covers the needs of those with protected characteristics or that any new policies will need to align with existing legislation such as the Public Sector Equalities Duties.

Business and Regulation

306. A Business and Regulatory Impact Assessment (BRIA) analyses whether a policy is likely to increase or reduce the costs and burdens placed on businesses, the public sector and voluntary and community organisations. While it is not possible at this point in time to conduct a full analysis of costs and impacts, the consultation asked:

Q25 Please tell us about any potential costs or savings that may occur as a result of our proposed approach and any increase or reduction in the burden of regulation for any sector.

307. Thirty-three respondents opted to provide a comment in response to this question.

Potential costs

308. A greater number of these respondents focused on potential costs, with the key theme, primarily cited by local government, being that local authorities would have increased costs due to the need for additional resources, additional staff, increased expertise and so on.

309. A small number of respondents in the business & industry sector, and a network, professional and trade body respondent commented that heat networks in new homes are unlikely to be economically viable because new homes are already highly energy efficient. A small number of respondents also referred to increased costs for businesses because of the regulations under which they would operate, the costs of bidding for, and obtaining, consent. One network, professional and trade body noted,

“The relationship between cost and risk should be a key principle in informing how a regulatory approach manages risk for district heating. Reductions in risk and perceived risk will reduce the cost of capital for new schemes and the cost of development and operation, therefore reducing costs for heat consumers. Regulatory approaches which do not reduce risk may add cost to schemes, and therefore costs to customers”.

Potential savings

310. Only a small number of respondents identified any likely savings, with some local government organisations referring to the potential for residents to make significant savings from the development of an LHEES due to improvements in thermal energy or having a more efficient heating supply through district heating. In terms of savings to non-domestic organisations, there were suggestions that the development of LHEES could lead to a reduction in the Climate Change Levy, CRC or EU ETS costs. A very small number of respondents referred simply to the potential for economies of scale that could be achieved.

Privacy

311. The consultation paper explained that a Privacy Impact Assessment (PIA) considers the protection of personal data and asked respondents if they were aware of any impact in this area:

Question 26 Please tell us about any impact on individual privacy / data that may result from our proposals. If there is an impact on individual privacy, are there any special provision / measures we should consider / make / include that would better assist in ensuring that this privacy impact is lessened / negated?

312. Thirteen respondents opted to provide commentary to this question. The key themes emerging were that LHEES strategies need to incorporate the most stringent requirements of the Data Protection Act, with a small number of respondents referring to the need to consider the new GDPR legislation being introduced in May 2018; also that there is a need for national guidance and for guiding principles to be applied.

313. A very small number of local government respondents noted that security of data is of importance and that guarantees regarding the secure management of data will need to be offered. A similar number – again local government respondents – also noted that there will be a need to carry out Privacy Impact Assessments to determine the impact on an individual’s privacy and to be able to identify and manage and privacy risks, and that anonymised data should be used wherever possible.

Summary of Findings: Assessing Impact

There was general agreement with the need to protect groups of people who may be more vulnerable to the impact of fuel poverty, with very few potentially negative impacts being outlined by respondents.

Respondents noted the need to ensure that protected characteristics should be included and addressed in LHEES and that developing strong consumer protection will ensure that vulnerable groups are protected.

Respondents tended to focus on potential costs in relation to the Business and Regulatory Impact Assessment, rather than potential savings. The key cost identified was that local authorities would have increased costs due to the need for additional resources, staff and expertise.

Likely savings outlined included the potential for residents to make savings on their heating bills.

There were comments on the need for LHEES to incorporate the requirements of the Data Protection Act; and also some reference to the need to consider the new General Data Protection Regulation (GDPR) requirements being introduced in May 2018.