Scotland's Sustainable Housing Strategy

1. Executive Summary

Since 2007 the Scottish Government has provided substantial investment towards sustainable housing. We invested almost £150m on fuel poverty and energy efficiency programmes between 2009/10 and 2011/12 with an estimated net gain in household income of about £700m and a saving of 3 million tonnes of CO2 as a result. We are spending around a quarter of a billion pounds over the current spending review period on fuel poverty and energy efficiency. We have shown through our continued investment in difficult economic times that helping people heat their homes for less and reducing our carbon emissions are important priorities for this Government.

Since 2008, more than 540,000 homes received over 629,000 free or subsidised professionally installed cavity wall or loft insulation measures through the Carbon Emission Reduction Target ( CERT) scheme and assisted by our home insulation programmes delivered by local councils. By the end of 2011, only 2% of homes had no loft insulation and 86% of lofts in Scotland had at least 100 mm insulation, 45% had 200 mm or more and two thirds of cavity walls had been insulated. The Scottish House Condition Survey showed that 125,000 homes upgraded their boilers in the last year and our boiler scrappage scheme contributed to this achievement.

Although these actions have helped many homes across Scotland there is still a great deal of work to be done to meet our challenging carbon emission and fuel poverty targets. We are working closely with our stakeholders to ensure that Scotland gets its fair share of all available funding and the centrepiece of this will be our Home Energy Efficiency Programmes for Scotland. This strategy builds on the good work we have been achieving and sets out our vision for a future of warm, high quality, affordable, low carbon homes and a housing sector that helps to establish a successful low carbon economy across Scotland.

This strategy follows on from the consultation document, 'Homes that don't cost the earth' which was developed with the Sustainable Housing Strategy Group. This group was established by Alex Neil, the former Cabinet Secretary for Infrastructure and Capital Investment and later chaired by the Deputy First Minister, Nicola Sturgeon and whose members include leading housing, fuel poverty, environmental and consumer interests.

'Homes that don't cost the earth' ¹ was published on 25 June 2012, and the consultation closed on 28 September. The consultation was supported by a number of events arranged by organisations including SFHA, ALACHO, local councils and the Scottish Government. There were 91 non-campaign responses and 348 campaign responses to the consultation. The responses have now been analysed and have helped the development of this strategy ² . Alongside this was a parallel consultation on a new Energy Efficiency Standard for Social Housing ³ .

There was broad support for the vision and objectives for the strategy, which are to:

• deliver a step-change in provision of energy efficient homes to 2030 through retrofit and new build, as promised in the Infrastructure Investment Plan;
• ensure that no-one in Scotland has to live in fuel poverty, as far as is reasonably practicable, by 2016;
• make a full contribution to the Climate Change Act targets, as set out in the Report on Proposals and Policies; and
• enable the refurbishment and house-building sectors to contribute to and benefit from Scotland's low carbon economy and to drive Scotland's future economic prosperity.

The actions to be taken under each of the themes set out in the consultation are presented in this document. Actions relating to skills and training have been integrated into the relevant theme. In this strategy we focus on the energy efficiency aspects of sustainability, while recognising the wider aspects of this agenda, and in particular the importance of house condition.

These actions include:

• Making available £79m of funding for 2013-14 to establish the Home Energy Efficiency Programmes for Scotland ( HEEPS). This will deliver on the Fuel Poverty Forum's recommendations for a shift of focus to Area Based Schemes to tackle fuel poverty but with national schemes to provide for the most vulnerable households wherever they live. Our spending, taken together with energy supplier funding which we aim to lever in under the Energy Company Obligation, should deliver £200 million annual expenditure in Scotland.
• Launching our Affordable Warmth Scheme which aims to ensure that every eligible household in Scotland receives support under the ECO Home Heating Cost Reduction Obligation. We have extended stage 4 of the Energy Assistance Package for a further two years (renamed the Energy Assistance Scheme) focussing assistance on the most vulnerable and poor households which were previously eligible for heating and insulation measures but who would otherwise miss out under the Affordable Warmth Scheme. Taken together, both these national schemes ensure that more than 300,000 poorer households will be eligible for free or heavily discounted insulation and heating from 1 April 2013.
• We will publish a new Energy Efficiency Standard for Social Housing by Autumn 2013, with an expectation that landlords will meet the standard by 2020.
• We have set up a working group to develop proposals for minimum energy efficiency standards in private sector housing, taking account of issues raised in the consultation.
• Building on advice from the former Financial Services Authority, we will actively engage with lenders, consumers and surveyors to evaluate the opportunity of including a valuation premium on energy efficiency measures.
• We will develop proposals in 2013 for a working group/forum to consider developing a single condition standard for all tenures of housing.
• We will continue to provide an extra £4,000 funding through the Affordable Housing Supply Programme ( AHSP) for every home meeting the 'silver' sustainability standard for emissions and energy use within section 7 (Sustainability) of building regulations. To encourage greater take-up, from 2013/14 this funding will be available as an addition to the mainstream resources available at council level.

It is intended that this strategy will stimulate action that impacts positively on climate change and hence on the environment. Prior to consultation, consideration was given to whether a full Strategic Environmental Assessment was required and a Screening Report was submitted to the consultation authorities, Scottish Environment Protection Agency, Historic Scotland and Scottish Natural Heritage. Their view was that this strategy sits within a hierarchy of other plans and proposals that have already been undertaken or will undertake full assessments in future, and thus to proceed with an SEA would not be necessary at this stage. The Screening Report and determination are available on the Scottish Government website ⁴ .

An Equalities Impact Assessment has been carried out for this Strategy and is available on the Scottish Government website ⁵ . The assessment found no evidence that any direct discrimination will arise from any part of the strategy, although it will be important to avoid any unintended or indirect discrimination.

It is likely that the Home Energy Efficiency Programmes for Scotland will have the greatest positive impact on older people, people with disabilities and single adult households as these are the groups most likely to be in fuel poverty. Over time all households, in both new and existing housing, should see positive benefits from improvements in energy efficiency, comfort and housing quality. Through its contribution to the low-carbon economy, the strategy could also provide opportunities to promote good relations, advance equality and create a more diverse workforce.

A Regulatory Impact Assessment ( RIA) is underway to provide further information on the net cost and benefits of the proposed Energy Efficiency Standard for Social Housing. In due course, an RIA will also be undertaken to underpin development of proposals for minimum energy efficiency standards for private sector housing.