Publication - Research and analysis

Energy Efficient Scotland: consultation analysis

Published: 22 Nov 2018

Analysis of responses to our public consultation 'Energy Efficient Scotland: making our homes and buildings warmer, greener and more efficient'.

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97 page PDF

929.2 kB

Contents
Energy Efficient Scotland: consultation analysis
Improving our homes

97 page PDF

929.2 kB

Improving our homes

The section of the consultation paper entitled 'Improving our homes' explains that, as set out in the Route Map, the Scottish Government proposes setting a Long-Term Standard for energy efficiency in the domestic sector, to be met by 2040. This will be a minimum of EPC rating of Band C for the domestic sector as a whole, although some tenures will be asked to achieve an earlier and/or higher energy efficiency rating. Specifically:

  • Social landlords will be set a target of maximising the number of social-rented homes that meet EPC Band B by 2032. This standard is covered by a separate consultation[1] and is not addressed directly in this report.
  • For the private rented sector (PRS), a target of properties achieving a rating of EPC Band C or better by 2030 is proposed. Current standards for the PRS - a minimum of EPC Band E by the end of March 2022 and then Band D by the end of March 2025 - were consulted on in 2017.[2]
  • For owner occupied properties the target is to maximise the number of homes achieving EPC Band C by 2030, and that this rating should be achieved by 2040 at latest.

Additionally, a target for fuel poor households, regardless of tenure, of improvement to EPC Band C by 2030 and Band B by 2040 is proposed.

All homes must reach at least an EPC Energy Efficiency Rating Band C by 2040, where technically feasible and cost-effective

Question 1 - What are your views on our proposal for owner occupied and private rented properties to achieve the Long-Term Domestic Standard EPC Energy Efficiency Rating Band C by 2040 at the latest?

Some respondents, from a broad range of respondent types, made a general statement of support for the proposals or agreed the value of setting long-term targets. However, approval of the principles was frequently accompanied by caveats, primarily that the date specified should be earlier than 2040. Again, this was raised by a broad range of respondent types.

Among alternative suggestions, the most frequent position was that 2030 would be a more appropriate date, a view more commonly held by Third sector and Scottish Government delivery agent respondents. A motion passed in the Scottish Parliament on 10 May 2018 stating that 'where feasibly possible the target date for all homes to achieve an EPC Band C rating should be 2030 not 2040'[3] was referenced.

Different combinations of EPC ratings, dates and tenures were also proposed, in each case by one or a small number of respondents, including a minimum of:

  • Band C by 2025 for PRS properties.
  • Band C by 2032 for all homes.
  • Band C by 2035 for owner occupied properties.
  • Band C by 2035 for all homes.
  • Band B by 2035 for all homes.
  • Band B by 2040 for all homes.

It was argued that problems may be created by having different standards for different tenures - for example, when seeking to improve efficiency in multi-tenure blocks.

The need for additional milestones or interim targets was also proposed, in order to ensure progress is on track or to incentivise early action.

Absence of details on how many households the Scottish Government expects to lift out of fuel poverty by improving homes to EPC Band C was noted, as was lack of any indication of how the proposals might be implemented, monitored or enforced.

Respondents who described the proposals as ambitious or challenging came from a broad range of respondent types and were often amongst those highlighting the need to provide property owners with grant funding or other incentives if targets are to be achieved. The need to ensure that advice and support are made available was also noted, and that this should be both impartial and specific.

Some respondents who expressed concerns regarding the proposals felt they were unrealistic or potentially too ambitious. Private landlord or property management respondents more frequently made this point.

Whilst this is an admirable target we do not view this as feasible… it is our opinion that it would be unrealistic to expect existing dwellings, especially much older ones, to achieve this target.
Private landlord or property management respondent

Instances cited where Band C might be unrealistic were older buildings of traditional/stone-built construction, including tenements, and in rural areas. It was also noted that the Scottish Government has changed the position set out in the 2017 consultation on Energy Efficiency and Condition Standards in Private Rented Housing with regard to raising the standard beyond Band D.

The median cost of £3,500 quoted in the consultation paper as the Scottish Government's estimate of the expenditure needed to bring a private sector property to Band C was queried, particularly with respect to older properties, and to rural and island areas where installation costs may attract an additional premium. Whether an impact assessment for islands had been carried out was questioned. Experience from England of higher costs required to achieve only Band E energy efficiency ratings was also cited. The degree to which even £3,500 can be considered affordable to households on low incomes or in fuel poverty was queried.

Potential gaps in supply chains in some areas were noted.

Respondents from a broad range of respondent types raised concerns regarding aspects of the current EPC system. These were that:

  • Some properties may be unable to achieve Band C, for example as a result of their traditional construction type, rural location, or being off-gas grid.
  • Some of the improvement measures recommended by the EPC might have a negative effect on building performance were they to be installed, for example by reducing ventilation and encouraging dampness.
  • The EPC score relies on too many assumptions, and assessments have been inconsistent.
  • The state of repair of the property is not considered.
  • Actual energy consumption is not reflected, and occupier behaviour should be tackled as well as improving the fabric of buildings.

It was suggested that although they may never achieve Band C using present EPC methodology, many traditional buildings provide habitable homes. It was argued both that these homes should not be put out of use, and that their value may be adversely affected if potential purchasers are concerned over future liabilities. An impact assessment on the housing market was proposed. It was also argued that future changes in EPC methodology may mean that requirements to achieve a Band C rating in 2040 will be very different to those at present.

The methodology of the EPC system is discussed further at Question 6, but concerns regarding EPCs were also a theme in responses at other questions. Two respondents cited the need to ensure that:

… any work and expense is based on accurate EPCs in which the consumer has confidence…
Professional or representative body respondent and Private landlord or property management respondent

The importance of setting out what is covered by 'technically feasible and cost-effective' was noted, and it was argued that this should be defined as soon as possible rather than in 2020. The importance of a regulatory system having the flexibility and exceptions available to limit the standard to that which is technically feasible and cost-effective was also noted. What is meant by 'able to pay' was also seen as unclear and it was felt that a definition is urgently required.[4]

Finally, several respondents - primarily Individuals - expressed general opposition to the idea of any mandatory standards or enforcement action in relation to owner occupied property, a theme which also ran through several of their responses at later questions:

Not the job of the state. We are talking private property.
Individual respondent

It was argued that there should be wider discussion about such a level of state intervention.

Exceptions to the proposed Programme LongTerm Domestic standard (private rented and owner occupied homes)

While Question 1 asked for respondent's views on setting a Long-Term Domestic Standard (LTDS) of EPC C by 2040 at the latest, Questions 2 and 3 sought views on whether there should be circumstances in which lower standards or longer times are acceptable. Both questions had a closed, multiple choice element, followed by an opportunity to comment.

Question 2 - Do you think we should allow for situations where a lower standard is acceptable?

Responses to Question 2 by respondent type are set out in Table 2 overleaf.

Table 2: Question 2 - Responses by type of respondent.

  Yes No Don't know Not answered Total
Organisations:          
Academic 2 1     3
Building component manufacturers/services 6 2 2 3 13
Energy related private sector 10   1 6 17
Housing Association       1 1
Local Authority 20     2 22
Other   1   1 2
Private landlord or property management 8       8
Professional or representative body 9   1 2 12
Public sector or body - other 2   1 1 4
SG delivery agent 2       2
Third sector 8     2 10
Total organisations 67 4 5 18 94
Individuals 28 5   3 36
All respondents 95 9 5 21 130

A substantial majority of respondents who answered the question thought there should be situations where a lower energy efficiency standard is acceptable.

The analysis below is divided broadly according to the respondent's answer at the closed element of the question. Points made by respondents who selected 'do not know' or who did not answer the closed element are included where most appropriate.

Yes, there should be situations where a lower standard is acceptable

Some of those who thought a lower standard should be acceptable made points concerning perceived flaws in the current EPC system. These were that the EPC rating does not reflect the real performance of traditional buildings, does not take account of fittings such as shutters or heavy curtains, and does not reflect actual energy consumption which is also affected by choices made by occupants. The disadvantage to properties that are off-gas grid was also observed, as was a risk that some recommended measures may cause harm to traditional buildings. EPC ratings are discussed further at Question 6. These concerns were voiced by respondents from a broad range of respondent types.

Specific circumstances
Examples of specific circumstances in which acceptance of lower standards might be necessary were given by most respondents. The most frequently cited are set out below and, in each case, were highlighted by respondents from a broad range of respondent types.

  • For hard-to-treat buildings – typically older, traditionally-constructed properties that may be unable to achieve EPC Band C in a cost-effective manner. While some respondents made points relating to high costs and technical difficulties in improving such properties, it was also argued that there should be a move towards amending the Tolerable Standard to support the removal of properties that cannot be improved to an acceptable minimum standard from the housing stock.
  • For listed buildings and buildings in conservation areas or where planning permission is required. Although the importance of balancing possible savings against preserving the character of traditional buildings was noted, so too was consideration of Listed Building legislation and a more pragmatic approach regarding use of modern materials to ensure listed buildings can be improved. Work to establish how heritage buildings can meet as high energy performance standards as possible was also proposed.
  • Where the recommended measures are not cost-effective or not affordable. While some respondents cited cost to achieve Band C as a reason for an exception to be given, there were also arguments against exceptions on grounds of affordability, identifying the need for financial assistance to be provided instead. It was highlighted that homeowners who cannot afford improvements may seek an exception rather than seek support, and that they must be made aware of the help available.
  • In situations where permission or financial contributions from multiple owners/tenures are required and a consensus may be hard to achieve, particularly where there is no factoring agreement. The need for further work to establish how lower standards might be applied to flats was noted. However, one Local Authority respondent pointed out that in their region, a significant proportion of households in fuel poverty live in privately rented tenement flats, often in mixed tenure buildings, and that there was a need to ensure vulnerable groups do not fall through the net.
  • For remote, rural or island locations where properties are often of traditional construction type and off-gas grid, and installation costs are high. It was also argued that higher costs associated with work in rural areas should be factored into funding arrangements, and that consideration for island communities would be appropriate in the light of the Islands (Scotland) Act 2018.
  • Where measures are not technically feasible.

In addition, small numbers of respondents suggested the need for lower standards to be acceptable where:

  • There are issues related to local infrastructure. An example given was low water pressure making installation of a combination boiler inappropriate.
  • Other targeted reductions (such as LED lighting or heating system optimisation) are possible.
  • Electricity is used for heating if there is no practical alternative.
  • The proposed measures may be harmful to air quality or to the health and wellbeing of the occupier.
  • Measures such as wind turbines are inappropriate for the landscape.
  • Owner occupiers do not wish to improve their property.

More generically, acceptance of lower standards in situations similar to those permitted in the social sector under EESSH was proposed.

Aspects of any exception procedure
Although in favour of at least one circumstance where a lower standard should be allowed, several respondents also identified limits or controls that they would like to see imposed, including that there should be:

  • A limited number of exceptions. Third sector respondents were amongst those raising this issue.
  • A clear, transparent, standardised approach with appropriate guidance provided.
  • A requirement to produce evidence in support of an application for a lower standard to be applied.
  • Regular reviews or temporary, time-limited exceptions as development of new technologies may mean that the reason for an exception being granted no longer applies.
  • Robust policing or effective enforcement, including competent experts to investigate and adequate resources to manage the process.

Any use of exemptions must be robustly policed, so that avoidance of the standard is only possible where genuine reasons exist.
Professional or representative body respondent

It was also argued that properties should be improved as far as possible and not given complete exemptions. Specifically, it was suggested that a lesson could be learned from implementation of Minimum Energy Efficiency Standards in England and Wales.

Other issues raised

A small number of respondents thought that relaxation of energy efficiency standards in some situations might be linked to the decarbonising of energy sources, with one proposal that a lower rating (or a later date) might be permitted where the heat source is low carbon. It was also noted that at national level, overall energy efficiency savings required to meet 2050 decarbonisation targets will depend on the pathway for electricity generation in the Energy Strategy, and also that the Scottish Government will need to understand where any shortfalls in energy savings in the domestic sector can be made up elsewhere in the economy.

Potential effects on the rental property market were suggested, including that failure to allow lower standards for some traditionally built properties may result in these being removed from the rental market, reducing the size of the market or leading to higher rents as landlords seek to recoup investment.

The risk of damage to public perception of the Programme by problems associated with retrofitting was also highlighted, for example issues associated with cavity wall insulation. The importance of adequate training of installers was noted, both to avoid negative consequences associated with poor installation and also to help with the promotion of retrofit to households.

It was cautioned that care should be taken to ensure that granting exceptions does not result in lower standards being considered acceptable across whole areas of rural Scotland, while funding flows elsewhere. Further, since the properties affected are likely to be those where improvements would have greatest benefit for both the occupier and the environment, it was suggested that work to identify whether other support could be put in place will be important. An example given was provision of a personalised home energy advisory service to help occupants understand how their behaviour affects energy use.

No, there should not be situations where a lower standard is acceptable

A small number of respondents from a range of respondent types argued that:

  • An EPC band C rating is deliverable for all but a few properties and, as new technologies reach the market, still higher standards may be possible.
  • A property being harder to improve is not a reason to leave households living with a poor standard of energy efficiency:

If the aspiration is to bring all households to a basic standard of EPC C, then no one should be left behind simply because they reside in a property that is rented or is harder to improve.
Other respondent

  • Action in retro fitting buildings has been slow and allowing lower standards will not support meeting targets.

Since landlords are running a business, it was argued they should be required to meet minimum standards, or that there could be a cap on rental costs for properties where a lower minimum energy standard has been allowed.

Question 3 - Do you think we should allow for situations where a longer period for improvement is allowed?

Responses to Question 3 by respondent type are set out in Table 3 below.

Table 3: Question 3 - Responses by type of respondent.

  Yes No Don't know Not answered Total
Organisations:          
Academic 2 1     3
Building component manufacturers/services 3 4 2 4 13
Energy related private sector 8 2 2 5 17
Housing Association       1 1
Local Authority 18 1 1 2 22
Other 1     1 2
Private landlord or property management 7   1   8
Professional or representative body 7 1 1 3 12
Public sector or body - other 2   1 1 4
SG delivery agent 2       2
Third sector 6 2   2 10
Total organisations 56 11 8 19 94
Individuals 24 6 3 3 36
All respondents 80 17 11 22 130

A majority of respondents who answered the question thought there should be situations where a longer period for improvement is allowed. Building component manufacturers or services respondents were the only group in which a majority who answered the question did not agree.

As at the previous question, analysis below is divided broadly according to the respondent's answer at the closed element of the question, with points made by respondents who did not know or who did not answer the closed element included where most appropriate.

Yes, there should be situations where a longer period for improvement is allowed

A small number of respondents who agreed that there should be situations where a longer period is allowed thought that extensions would be preferable to accepting a lower energy efficiency standard. Others, largely Individual respondents, reiterated a view that standards should not be imposed upon the owner occupied sector at all or that the EPC system is not currently fit for purpose. The need for more detailed information on resources and interim targets to be provided was also identified.

Specific circumstances
Examples of specific circumstances in which extensions might be necessary or appropriate were often given. The most frequently cited were:

  • Where improvements are very expensive, not cost-effective, where the owner cannot afford the recommended measures or where improvements are more affordable when costs are spread over a longer period. Local Authority and Individual respondents more frequently made this suggestion. However, it was also suggested that lower income households should seek support to make improvements rather than avoid taking action.
  • For older, traditionally-constructed or poorly performing properties where complex, technical or expensive measures are needed.
  • For listed buildings, buildings in conservation areas or where planning permission is required.
  • When other repairs to the building fabric are also required or are needed before energy efficiency measures can be installed:

There is no point in installing energy efficiency improvements if the property has a leaky roof or damp issues from concrete pointing.
Local Authority respondent

  • Where there are limited supply chains or where specialists on traditional buildings are required. Potential bottlenecks and inflated costs before compliance dates were also suggested.
  • In situations where consent or financial contributions from multiple owners are required. However, the need for further policy or legislation to allow resolution of such problems was also highlighted.
  • For remote, rural or island locations where properties are often of traditional construction type and off-gas grid, supply chains are limited, and installation costs are high.
  • Where the occupants (often tenants) find the required work too disruptive or to have health impacts, or when work would be better carried out when properties become vacant.

Some of the works required to improve the energy efficiency of properties can be extremely disruptive... Dispensation should be made so as to reduce disturbance and disruption for tenants.
Private landlord or property management respondent

  • Where major projects, including planned area based schemes such as district heating, will bring significant benefits.

Small numbers of respondents noted the need for extensions where:

  • Suggested measures are not technically feasible or cost-effective.
  • Works (such as installation of exterior wall insulation) are weather dependent.
  • Protected species (such as bats) are present.
  • Gaining access to a rented property is problematic.
  • Grant funding is not available.
  • New technologies may become available, potentially allowing a move directly to a higher standard. However, it was also argued that since technological advances follow requirements, extensions will reduce urgency and divert resources away from innovation.

Other ideas, each raised by only one or a small number of respondents, were extensions in areas relying on tourism, in regeneration areas and for park homes. More general ideas were that an extension should be considered where a chartered surveyor confirms that installation of proposed measures would devalue a property, or that, for uniformity across sectors, the same reasons for a property to be exempt from EESSH should be applied to owner occupied and private rented properties.

With respect to the PRS in particular, the importance for new regulations to be compatible with the new Private Housing (Tenancies) (Scotland) Act 2016 was highlighted. It was also noted that proposed abeyances were included in the 2017 consultation on Energy Efficiency and Condition Standards in Private Rented Housing[5] but that these have yet to be published, resulting in uncertainty and concern for some property owners.

Aspects of any extension procedure
Although in favour of at least one circumstance where more time should be allowed, several respondents also suggested limits or controls that they would like to see imposed.

Academic and Local Authority respondents were amongst those arguing that the number of situations meriting extensions should be limited and be the exception rather than the rule, and that they should be clearly defined and consistently applied, with creation of loop holes avoided. Other suggestions were the need for the procedure for seeking an extension to be free, simple and quick, and for a generic 'reasonable excuse' provision, accompanied by guidance on specific situations which are not considered as reasonable excuses.

A requirement to investigate requested extensions or to provide evidence was proposed by a small number of respondents, as was the need for qualified assessors to make decisions regarding extensions, and that verification by Local Authorities might be appropriate for some criteria. Agreement of an alternative pathway to achieve compliance was also suggested, as was evidence that owners are developing strategies to reach the levels for more challenging 2050 targets.

With respect to the duration of any extensions, both limited times and regular reviews were seen as important to establish whether new technologies or funding streams have become available in the interim.

With respect to enforcement, a small number of respondents argued that sale or rental of properties that do not meet required standards could be prevented, but also that a rigid approach to enforcement should be avoided where there has been progress towards compliance and there are plans to complete outstanding works. In tenements and shared properties, it was argued that any enforcement action should be directed at those owners responsible for the delays rather than all owners in the building. A subsidy to tenants of a property with an exception or abeyance was also suggested:

… there should be consideration of whether there should be some kind of subsidy … such as reducing council tax rates for properties that can't meet the standard, to even the playing field for those tenants.
Third sector respondent

Issues associated with enforcement are discussed further at Question 10.

Other issues raised
It was thought that care should be taken to ensure that granting of extensions does not result in improvements being delayed across whole areas of rural Scotland, while funding flows elsewhere. Further, since the properties affected are likely to be those where improvements would have greatest benefit for both the occupier and the environment, it was suggested that work to identify whether other support could be put in place will be important. A Health Inequalities Impact Assessment to determine the health impact of allowing a longer period for compliance was also proposed, to inform actions the Scottish Government could take to mitigate impacts identified.

No, there should not be situations where a longer period for improvement is allowed

Amongst respondents who did not agree with extensions being given, the most frequently given reason was that the proposed time scales are already long enough. Third sector and Individual respondents were amongst those taking this view. Arguments were that if exceptions are available there should be no additional requirement for extensions, or that granting extensions weakens the Scottish Government's message:

Allowing for longer periods, in addition to exemptions/reduced standards, risks creating confusion and weakening the message 'all homes to EPC C'.
Building component manufacturers or services respondent

In fact, several of these respondents did cite a small number of circumstances when extensions might be necessary, although that these should be only in exceptional circumstances or if a clear case for a significantly improved outcome can be made.

Respondents also pointed to the potential benefits of carrying out all the improvements to move a property to a good EPC rating in one go, rather than adopting an incremental approach that may be less cost-effective or necessitate more episodes of disruption. With respect to disruption to households, experience from Scotland's Energy Efficiency Programme[6] (SEEP) Phase 1 pilots was quoted, including findings that tailoring improvement measures according to the capacity of a household to cope with disruption (for example, avoiding internal wall insulation) resulted in higher uptake of measures.

Finally at Question 3, both respondents who agreed with extensions, and those who did not, pointed to the importance of communicating any new standards to property owners to raise awareness.

Technically feasible and cost-effective

Question 4 - We are proposing that the definition of a cost-effective measure is that it should payback over its lifetime. What are your views on this definition?

Some respondents, from a broad range of respondent types, expressed general agreement with the definition, commenting that it is reasonable, fair or offers a sensible approach. Others, again from a broad range of respondent types and including a number of Individual respondents, noted specific questions, concerns or reservations, while some took a rather more negative view including that the idea of payback over a lifetime is flawed, or that the policy should not be imposed unless the Scottish Government pays for improvement measures.

Defining the 'lifetime'

Some respondents who commented on the concept of the lifetime of a measure argued that this is too vague or subjective, or that more information is required including who would make such decisions and detail on the payback calculation to be used. It was questioned whether the payback would be theoretical or measured, and whether it would be tailored to an individual building. The importance of producing a clear, reliable definition was highlighted, and also that because the lifetime of a measure may vary according to weather conditions, criteria should not be the same across the country. Other points raised, in each case by one respondent, were:

  • Lifetime may be dependent on both level of use and maintenance.
  • The lifetime of some newer technologies is unknown as they have not yet been installed for such a period.
  • Some measures may be obsolete before they wear out.

The view that a lifetime is too long, or may be longer than property owners will accept was expressed, with alternative proposals - each made by only a very small number of respondents - that the appropriate payback period should instead be:

  • 2 years.
  • 3 years.
  • 5 years.
  • 10 years.

Other ideas were that the payback period should be: determined by the length of the guarantee provided with the efficiency measure or that it should be no longer than the guarantee period; that it should be a set period proportionate to the initial expenditure; that there should be a cap of 25 years; that for improvement to a building, it should refer to the fabric of the building itself; or that a measure should at least payback over its lifetime. A threshold limit, relative to property value was also proposed, as was a cost cap of £3,000. It was also noted that the proposal of cost-effectiveness over a lifetime represents a move away from the idea of a cost cap as discussed in the 2017 consultation on Energy Efficiency and Condition Standards in Private Rented Housing.

A further suggestion was that the definition does not provide an incentive to make early improvements, but rather to wait, in the hope that better or cheaper alternatives will become available.

Defining what is 'cost-effective'

Some respondents felt that the definition of 'cost-effective' needs clarification, including how cost-effectiveness will be determined and by whom. Respondents also reported personal experience of suppliers making exaggerated claims about potential savings, or argued for the need for a source of accurate data, independent of manufacturers. It was observed that while the definition needs to be clear and well understood, it should also be sufficiently flexible to allow for different circumstances.

Experience from the Green Deal that anticipated energy savings are not always realised was also cited, along with an associated concern that some homeowners could be left in financial difficulties. Transparency, and consumer understanding of what 'payback' means, were regarded as essential, as well as a rule that benefits should not be transferable to third parties to assist with payment for improvements. A risk that promoting cost-efficiency in energy efficiency measures could be counter to public safety was also noted:

Some energy efficiency measures, particularly SWI, [solid wall insulation] can be executed at a low cost using combustible materials…
Building component manufacturers or services respondent

Other points on what cost-effective will mean in practice, each raised by only one or a small number of respondents, were querying which costs would be included or suggesting whole-life costing as a more suitable approach. Some respondents highlighted specific items that could be considered such as the cost of surveys and obtaining necessary permissions; installation costs; ancillary costs such as redecorating; maintenance or servicing charges; and interest on any loans. It was also noted that owners might face additional repair costs before an efficiency measure can be installed.

Variations in the cost of measures in different locations, typically in rural areas, were highlighted by a small number of respondents. Since rural and island premiums are not allowed for by EPC costings it was argued that this will have an impact on what is cost-effective. Similar points were made with respect to homes that are off-gas grid, and it was argued that payback periods must be specific to a property.

There was a view that variations in energy costs make it difficult to predict what is cost-effective over the longer term, and also that changes in the relative costs of energy from different sources could impact the payback period of some measures. The need for a mechanism to allow updating of the calculation to reflect changes in both energy prices and the cost of measures was suggested.

Other points raised with respect to cost-effectiveness, each by one or a small number of respondents were:

  • Effective communication will be required to explain the definition to the public, for example by using case studies.
  • There is a risk of excluding renewable technologies, which may cost more than conventional ones and may not pay for themselves over their lifetime, and also a risk of excluding new technologies that become available during the long payback periods associated with older measures.
  • Actual energy use will make a significant difference to the payback period. For example, a household using a lot of energy because elderly occupants are at home all day will recoup investment much more quickly than a lone worker who is out all day and uses little energy to heat their home.
  • Rather than reducing money spent on energy after making improvements, occupants may use the same amount of energy to make their homes warmer, meaning the measure would not be cost-effective according to the definition. Providing householders with support to realise energy savings was suggested as necessary if the definition is to be achieved.

The importance of impacts on household comfort as well as financial saving was highlighted, including by a small number of Third sector respondents, and it was argued that some measures (such as double glazing) may not payback in terms of energy savings, but do provide increased comfort for householders:

…if the home is warmer and uses less energy, which will in turn reduce carbon emissions, then this should be incentive enough. Making financial savings … should be seen as just a bonus.
Energy related private sector respondent

Although not quantifiable as cost-effective to individual households, a small number of respondents made a case for including wider public benefits in the calculation of what is cost-effective. Reduced carbon emissions, reduced pollution and improved air quality, better health and wellbeing, and alleviating fuel poverty were all cited as valuable outcomes that are potentially overlooked by the proposed approach. Questions were raised about the implications for energy efficiency, climate change, and fuel poverty targets if a significant number of properties cannot reach Band C using cost-effective measures.

Affordability and financial assistance

Some respondents observed that the proposed definition makes no link to household income, and could mean a high, possibly unaffordable outlay for owners. It was argued that both easily accessible grants or loans will be needed to encourage installation, and also that there is evidence to suggest grants and tax incentives are likely to be more attractive to homeowners than are loans. A link to council Schemes of Assistance was also proposed.

Long payback periods

Third sector respondents were among those who raised issues with respect to expensive measures with a long payback period, such as solid wall insulation. Points made included that the proposed approach could result in properties with solid walls being excluded, even though fuel poverty occurs disproportionately in such homes. It was argued that the Scottish Government could help by providing longer-term loan funding than is presently available.

Where owners plan to sell before costs will be recouped, it was suggested that their willingness to install measures which payback over a long period may be affected, and that they may instead select lower cost measures that are not the most suitable or cost-effective for a property in the long term. Highlighting the short-term advantages of measures with a long payback period was seen as important to encourage their uptake. Potential benefits such as higher sale prices were proposed, although other respondents argued that costs associated with energy efficiency measures are not currently recouped when a property is sold.

Potential consequences in the PRS

With respect to the PRS it was noted that the concept of payback does not apply in the same way, as the landlord makes the investment but the tenant benefits from reduced energy bills. It was reported that rents are likely to rise as landlords seek to recoup their costs. Private landlord or property management respondents were amongst those who made this comment.

The only way for landlords to secure a return on the costs of the capital expenditure is through increased rents – so rent rises are a natural consequence of this approach.
Professional or representative body respondent

With respect to regulated tenancies, where a rent officer and not the landlord controls the rent, it was argued that required spending should be discounted in proportion to any discounted rent level. In other circumstances it was suggested that the Scottish Government should monitor the situation to ensure that tenants are not penalised through higher rents that are not off-set by energy savings.

Air quality and the Long-Term Domestic Standard

As the consultation paper notes, indoor air quality is a key health issue but may be adversely affected by some improvements in energy efficiency. Proper use of energy and ventilation systems will help ensure air exchange rates meet recommended levels, and advice for households, including tenants in rented properties, will be vital to successful outcomes. The EESSH2 consultation proposes that the Scottish Government and social landlords work together at the earliest opportunity to collect and analyse data on air quality, with a no detriment air quality requirement to be included in EESSH2 from 2025.

Question 5 - What are your views on the issue of air quality in relation to the Long-Term Domestic Standard?

Some respondents, from a broad range of respondent types, agreed that air quality is an important issue which the Scottish Government is right to consider in relation to the LTDS. While the contribution of energy efficiency measures to poor air quality was acknowledged, it was also felt that this is outweighed by the benefits of a warmer home to good health. It was noted that similar issues are being addressed at UK level as part of development of the new PAS 2035, and it was recommended that any standard introduced in Scotland should align with PAS 2035. Attention was also drawn to related work by Defra and by the Fuel Poverty Working Group.

Other general comments were that data gathered under proposals in the EESSH2 consultation should be used to inform Energy Efficient Scotland policy across all tenures, but also that private sector housing stock may be very different in some respects. Further research and data collection across a range of building types and tenures were proposed, including by a small number of professional or representative body respondents.

Although monitoring of air quality was supported, practical issues were also raised including who would conduct tests and how they would be paid for. Suggestions were monitoring a sample of properties that have received a measure, and that tests should be carried out both before and after improvement works. A Local Authority respondent described a pilot study being developed to collect air quality data for both new and existing housing stock.

Problems identified

Lack of ventilation
It was observed that making homes airtight to save heat causes moisture from various sources to be retained within a property, potentially leading to dampness, mould growth, and harm to both human health and the fabric of the building. Sealed chimneys and UPVC double glazing were highlighted as reducing ventilation, while occupants taking more showers was also raised as contributing to excess moisture. It was argued that problems caused by poor ventilation may increase with the interventions required to reach higher efficiency ratings:

The dangers associated with this are likely to be greater where the most significant interventions are made to a building, and therefore will increase with introduction of requirements to reach EPC Band C.
Public sector or body – other respondent

Insulation
Insulation fitted to traditional buildings that were designed to breathe was often cited as a cause of condensation, including by a small number of Private landlord or property management and Local Authority respondents. Loft insulation with foil-backed materials was also identified as causing condensation problems for roof timbers.

Other factors affecting air quality
Other factors cited as contributing to poor indoor air quality were wood burning stoves with poor combustion conditions, contaminated wood, and coal fired boilers. The potential for outdoor air pollution in built-up areas to affect the indoor environment was also raised. Diesel/petrol vehicles and use of biomass/solid fuel sources were cited as particular problems, while the benefits of renewable energy were highlighted.

Problems associated with overheating and excess heat in summer were also cited, as were the potential harm caused by: work during the installation process; gases given off by building materials; radon; secondary smoking; and excessively dry air from heat pumps.

Occupant behaviour
While acknowledging the importance of good ventilation, a small number of respondents pointed to the role of occupier behaviour in creating some of the problems with dampness and mould, for example by blocking or closing vents.

Solutions proposed

Some respondents highlighted the need for a more holistic approach to avoid adverse outcomes.

Good design and standards
The importance of good design of retrofit measures was regarded as key to ensuring adequate ventilation. A small number of Third sector respondents were amongst those highlighting this issue. Specific proposals were that designs for insulation schemes should incorporate arrangements for ventilation, and it was noted that, for new build, designers are required to develop ventilation strategies to maintain constant air exchange. Setting and enforcing standards for domestic ventilation were suggested to be important, and that all schemes that will change either the mode or the rate of ventilation should be assessed by an appropriately qualified inspector.

Setting standards with respect to air quality was seen as providing manufacturers with a commercial incentive to develop solutions that can meet both energy efficiency and air quality requirements, potentially mitigating the need for improved ventilation.

Accredited advisors for traditional buildings were also proposed as a means to ensure appropriate design in such properties, as was the possibility that a lower standard of energy efficiency might be acceptable for particular types of property where retro-fitting of insulation could have adverse effects.

Technical approaches
Mechanical Ventilation with Heat Recovery (MVHR) was identified as a potential solution where passive ventilation is inadequate, including by a small number of Local Authority and Third sector respondents. However, issues associated with reliability, costs of routine servicing and maintenance and additional energy use were also noted, as was the need for occupants to be trained in their use. The need for improved MVHR systems was suggested.

Use of air-to-air heat pumps was seen as offering benefits in reducing moisture levels within a property, and also as improving air quality for properties where external pollution is an issue. Moisture extraction by dehumidifiers was also reported to be effective and energy efficient.

Financial support
Provision of funding for installation of ventilation measures where needed as part of a retrofit scheme was proposed.

Advice to households was considered to be essential by respondents from a broad range of respondent types:

It is essential that insulation schemes incorporate design and measures for good ventilation at the same time, along with advice for households so they understand how to use new technologies and maximise their benefit.
SG delivery agent respondent

Suggestions were that such advice could be delivered by energy assessors or by installers, that it should be free, tailored and face-to-face, or accessible and available in several formats. The importance of those involved in delivering building retrofit being trained to provide information and formally required to do so was also highlighted. Home Energy Scotland was identified as well-placed to link advice on achieving good indoor air quality to advice on heating systems and insulation.

Provision of advice on heating and ventilation systems to new tenants at the start of their lease was also proposed, although it was acknowledged it may be difficult to ensure the advice is followed.

Using EPCs for the Long-Term Domestic Standard

The consultation paper explains that EPC rating of a property is affected by its energy efficiency, the type of heating system in place, and the cost of fuel. As a result, it can change over time as the underlying methodology is refined to take account of the latest knowledge, and also by changes to the fuel price data used in the calculation. Views were sought on how best to take account of potential future changes to EPC ratings driven by changing methodology and fuel price data.

Question 6 - The EPC Rating of a property can be affected by changes to the underlying methodology and to fuel price data. How do you suggest that the Programme takes account of this in setting the Long-Term Domestic Standard?

Some respondents, including Energy related private sector, Local Authority and Individual respondents, referred to their concerns regarding the accuracy or consistency of EPC ratings. These issues have been outlined at other questions and are also discussed at Question 16, so are not repeated here beyond two general points: firstly, that a number of respondents argued for EPC methodology to be revised before the policy is implemented; and secondly, that the assessment process needed to reflect actual energy use and occupant lifestyle.

It was acknowledged that EPC methodology or data needs to be updated, for example to reflect the advent of new technologies, with suggestions including that the existing process is slow and expensive, and that new products have not been credited in assessments because they have not been added to the database. A process for fast tracking new innovations was proposed, and that in the absence of a quicker process for updates, a system similar to that proposed in the EESSH2 consultation should be adopted. However, it was also argued that consumers should not be penalised because a technology in which they have invested is superseded during its working lifetime.

It was suggested that how to take account of changes in EPC methodology could be an element of the Scottish Government's commissioned research into issues surrounding the EPC process, but also that since the EPC process is commercially owned[7], there may be limited opportunity to influence its development. Further points were that EPC methodology has already been revised several times in recent years with suggestions that it would be helpful if definitions could be fixed for an agreed period or that the elements which can be fixed until 2040 could be explored.

When methodology is to be changed it was requested that this should be communicated clearly and at the earliest opportunity, and that properties approaching the end of an EPC's validity might be granted an extension if assessment criteria are to change. However, it was also felt that communication of a forthcoming change in methodology could lead to a rush to make improvements before a perceived higher standard was implemented.

Two issues were identified as consequences of changes in EPC data and methodology:

  • A property might change EPC Band and, potentially, drop below the required standard for compliance, solely because of changes in EPC methodology or fuel prices while a certificate is still valid.
  • It is difficult to compare EPCs of different ages or to monitor progress towards targets accurately.

Changes to EPC scores while a certificate is valid

With respect to the implications of a property changing EPC Band, it was suggested that compliance should be based on the most recent EPC assessment and should not be affected by changes to methodology or data while a certificate is valid. Respondents from a broad range of respondent types expressed this view.

We should be acutely aware of the goalposts being moved – or even the perception of it.
Local Authority respondent

When a new EPC was required, the owner should be required to comply with the standard in place at that time. Third sector respondents were amongst those who made this suggestion.

It was also argued that early adopters who achieve Band C will benefit from the improved energy efficiency of their home, even if the assessment has to be revisited in the future. Reducing the 10-year EPC period was also proposed.[8]

Comparing EPC scores

There were mixed views on the possibility of employing conversion tables, as used in the social housing sector, to correct variations in EPC methodology over time. Similar small numbers of respondents stated that:

  • Conversion tables could be used and do not need to be complicated, although accessible guidance on their use would be needed. Local Authority respondents were amongst those who took this position.
  • Conversion tables are too complex or confusing and should not be used for private landlords and owner occupiers. Third sector respondents were amongst those who took this position.

The importance that EPCs can be compared, including before and after improvements was noted, with proposals for a scaling methodology to allow comparison and also that a realignment exercise will be needed when methodology changes.

For an individual property it was suggested that consideration be given to publishing all EPCs prepared, rather than just the most recent version, to show the progression of improvements.

Updating or modelling EPC scores

A view was expressed that technology already exists to make the EPC much more interactive than is presently the case. It was proposed that EPCs stored electronically could be updated automatically when improvements are made rather than requiring owners to pay for a new assessment, or that an online 'ready reckoner' could allow owners to check what the current rating for their property would be. Third sector respondents were amongst those who suggested the latter proposal.

Changes in fuels price data

With respect to variations caused by fuel prices, small numbers of respondents suggested that price data should be removed from the calculation altogether but also that if price data were removed, EPCs prior to the change would be less useful for comparison purposes. The need for the most up-to-date fuel price data to be used to ensure that the measures installed are able to achieve the predicted savings was also argued, and that fuel price data affects consumer choices regarding heating system replacement.

While it was noted that current methodology does involve adjustment to account for changes in fuel prices, it was acknowledged that this works more effectively for some fuel types than others:

The existing home RdSAP methodology has already by its reliance on the full SAP methodology a mechanism within it which corrects for fuel price fluctuations within the calculation of the EPC rating. Fuel factors only affect the rating on each full revision of SAP, and this is corrected within the model by application of a post calculation adjustment to the initial SAP score. This adjustment tracks the price of energy across all domestic energy types, however as mains gas is the predominant type, the adjustment tends to work well for mains gas properties and less so for other fuel types.
Third sector respondent

A more comprehensive adjustment was called for:

…we would like to see a wider and more comprehensive post calculation adjustment to the raw SAP score, with a fuel factor over time being calculated for each specific main fuel type and applied only where that fuel is present. If this cannot be achieved, then we need to push for different thresholds depending upon the fuel type, much as is already applied under the Energy Efficiency Standard for Social Housing.
Third sector respondent

Other suggestions were that:

  • Fuel price data should be regional.
  • The price for natural gas could be used in all cases to avoid disadvantaging those properties that are off-gas grid or that other utility bills should also be included.
  • An additional rating could aggregate estimated energy costs cross-referenced against national and local average income data.
  • A fuel price cap could be calculated and fixed for a period of 2-3 years to keep figures more consistent.

Private Rented Sector (PRS)

The consultation paper notes the Scottish Government's intention to bring forward regulations requiring PRS properties to have an EPC Band E rating at change of tenancy from 1 April 2020 and that this will be required for all PRS properties by 31 March 2022. From 1 April 2022 a Band D rating would be required at change of tenancy and for all properties by March 2025. In order to provide certainty for landlords to plan improvements and make use of the support on offer, it is now proposed that PRS properties should reach the Long-Term Domestic Standard of EPC Band C by 2030.

Question 7 - What are your views on the proposal that all PRS properties meet EPC Energy Efficiency Rating Band C by 2030?

There was widespread agreement or agreement in principle with the proposal that all PRS properties should achieve EPC Band C by 2030. This came from across a broad range of respondent types. The setting out of a long-term trajectory and/or a staged approach was also supported, including by a small number of Third sector respondents.

Points made in favour of the proposed approach were that landlords will have the option to move to the higher standard in a single step if it is cost-effective to do so:

We agree that setting out the trajectory in required standards to 2030 is important to allow landlords to plan improvements in advance and decide the most cost-effective route to achieve the 2030 standard over time. Indeed, in many cases it will be more cost-effective and less disruptive for landlords to achieve a higher standard in one intervention, rather than in stages.
Third sector respondent

Other advantages identified as arising from making improvements in a single step were: less disruption for landlords and tenants, less enforcement activity for Local Authorities, reduced emissions, earlier alleviation of fuel poverty, and earlier parity with the social sector.

A small number of respondents qualified their approval as being subject to required improvements being technically feasible and cost-effective, or to appropriate exceptions being in place, with particular difficulties in meeting the standard for traditional properties in rural areas acknowledged. A small number of others commented that they would prefer a shorter or a longer timeframe, or would prefer to see closer alignment between sectors. Concerns whether the EPC system is the best method for implementing energy efficiency policy were also raised.

The need to raise awareness of the policy, among both landlords and tenants was highlighted, along with need to provide landlords with advice, support and financial incentives.

While it was noted that the PRS is subject to existing regulations and is easier to police than the owner occupied sector, a number of points were made with respect to the importance of enforcement of the policy. A lack of clarity as who will oversee compliance was noted and concerns were raised regarding the significant resource issues involved in enforcement. These issues were raised predominantly by Local Authority respondents.

Specific ideas were that rather than change of tenancy, landlord registration or re-registration might be a better trigger point for compliance, although it was also argued that the existing landlord register is not comprehensive, limiting its effectiveness as a tool for raising awareness among landlords.

Risks of unintended consequences were also highlighted, most frequently by Local Authority respondents. Issues included that landlords may withdraw from the sector or convert rental properties into holiday homes. Adopting common energy efficiency standards across all properties types was seen as protecting against conversion into holiday homes to avoid compliance. The risk of rent increases was also noted, and that increases might be disproportionate to any energy savings realised by tenants as a result of improvement measures. The need to carry out an impact assessment or to monitor rent increases was suggested.

Particular challenges relating to flats and to multi-tenure blocks were also noted, with a suggestion that the Scottish Government should focus attention on this property type. It was argued that there is an important role for building-level action in meeting energy efficiency standards.

Other points raised were that:

  • There may be an argument for directing resources at new build, or that Build to Rent could support both housing needs and energy efficiency requirements.
  • The consultation paper does not provide details of any cost cap. It was suggested that any cap should be set at £5,000.

Private landlord or property management and Individual respondents were amongst those who disagreed with the proposal. The most frequent argument was that the policy is not, or may not be realistic, particularly with respect to traditional or hard-to-treat properties, those in rural areas, or those that are off-gas grid. It was also suggested that the EPC system is not reliable, that it is not fair to place such onerous obligations on landlords based on an unreliable assessment method, and that it would be better to target financial incentives to landlords with the least efficient properties.

Reductions in the size of the private rental market were predicted, including that landlords will be deterred from investing, and the possibility that some property might be converted to holiday homes. Potential adverse effects on the wider property market were also noted, as was the likelihood of rent inflation, resulting from both attempts to recoup landlord investment and from reduced availability in the sector.

There may be a switch from fuel poverty to rent poverty...
Local Authority respondent

Other potential consequences identified by respondents:

  • A risk of inappropriate or damaging interventions, including adverse aesthetic outcomes and poor indoor air quality.
  • The need for many exceptions.

For a landlord seeking to comply, potential problems were suggested such as the existence of many flats within the PRS leading to difficulties related to mixed tenure, and also situations where a tenant refuses access. The Scottish Government was asked to ensure that any new regulations imposed on the PRS are compatible with the new Private Housing (Tenancies) (Scotland) Act 2016.

It was also argued that energy efficiency in the PRS will improve naturally over time without government targets, and that the standard required should be the same as for the owner occupied sector. Difficulties and costs associated with a mandatory scheme were also highlighted.

Owner Occupiers: encouraging action

The consultation paper notes the Scottish Government's view that, for the owner occupied sector, the first 10 years of the Energy Efficient Scotland Programme should be based on enabling and encouraging action, including through building existing support schemes such as the Home Energy Efficiency Programmes for Scotland (HEEPS), and through information on energy efficiency being provided at key trigger points. Whether there should be mandating action after 2030 would also be considered.

Question 8 - What are your views on our proposal for an initial period of encouraging action?

Some respondents, from a broad range of respondent types, agreed with the proposal or agreed in principle. Their comments were that this is a good idea and a reasonable or positive approach, and that it allows time to develop regulatory mechanisms or to carry out reviews around air quality. It was also suggested that there is potential to deliver the required improvements without mandatory action, and that a signal of intent to regulate will be a stronger driver for action than encouragement measures alone.

Respondents who did not agree, who included Academic, Local Authority, Third sector and Individual respondents, tended to take one of two positions:

  • The policy represents government interference in a matter of personal choice, is not practical or cost-effective for some properties, or is based on a flawed assessment system. This was a particular issue for Individual respondents.
  • Much time has already been spent encouraging action, that the proposal implies 'business as usual', or that there is no evidence that a further period of encouragement will be effective. A requirement for earlier mandating action, a clear timeframe for mandating action, or a clear statement of whether there will be mandating action were also recommended. (Further comments on mandating action made at Question 8 are considered at Question 10.)

Irrespective of their overall viewpoints, some respondents identified similar issues as being central to the success of the policy, most frequently highlighting the importance of raising awareness among homeowners and the need to provide sufficiently attractive incentives.

Communication with homeowners

Communication of the policy to homeowners, raising awareness and promoting the value of energy efficiency improvements were all regarded as important in encouraging action, as was the need for a consistent message to be sent throughout the encouragement period. Use of case studies and demonstrations to illustrate the benefits of new technologies was proposed.

While it was argued that owner buy-in will be critical to the success of the policy, potential difficulties in encouraging behavioural change were noted and a recent review of evidence on policy effectiveness with respect to encouraging households to retrofit was cited[9]. It was noted that many householders choose to invest in other home improvements rather than energy efficiency measures, and it was argued that rather than focusing on the need to meet climate change targets, there should be an emphasis on other benefits to homeowners:

The consumer, and consumer acceptance of energy efficiency measures, need to be at the heart of the encouragement to action… Success may depend upon the ownership of an energy-efficient home becoming an 'aspirational' social norm, with consumer motivation being driven neither by purely financial factors, nor purely environmental ones.
Third sector respondent

Upskilling local tradespeople was regarded as helping energy efficiency measures to be seen as part of other home improvements. Several respondents suggested that householders should also be made aware that there will be regulation in due course.

The Scottish Government, Local Authorities, Home Energy Scotland, and Citizens Advice Scotland were all argued to have a role in promoting the Energy Efficient Scotland policy. Using community organisations to engage with those who may be hard to reach was also proposed, as was the potential role of contractors already working at a property in advocating additional energy saving measures. A need to target vulnerable communities to ensure that the policy is presented as clearly as possible was noted, as was avoiding further irritation of home owners by cold callers.

Providing incentives

The need for meaningful incentives to encourage homeowners was frequently highlighted - some respondents thought that greater resources than those presently available will be required. These respondents came from across a broad range of respondent types.

This is carrot and stick question. If you provide the carrots, no problem. If it is going to be all stick, that is a different matter.Individual respondent

It was also argued that lessons should be learned from the low uptake rates of some previous schemes, which were reported to be too complicated or to offer poor incentives. If incentives provided do not prove sufficient in encouraging early action, it was felt that supply chains may come under pressure towards the end of the period, with a likely outcome of increased costs to owners.

Desirable features identified for incentive schemes were that they should be simple, flexible and easy to understand, and that they should be piloted before being rolled out. Providing a headline offer to coincide with the launch of Energy Efficient Scotland was seen as being helpful in capturing public attention, and also ensuring that early adopters do not miss out on incentives that become available later on.

The need to try new approaches was also seen as important and the Self-funding pilots[10] were referenced. Incentives proposed, in each case by a small number of respondents, were: loans; grants; subsidies; variations in Land and Buildings Transaction Tax (LBTT); variations in Council Tax; and conditional mortgages or green mortgages.

Comments specifically on the subject of loans included that they should be interest-free and not means tested, but that even interest-free loans may be of no use to some households if they are only paid after work is carried out. It was also suggested that councils could support schemes such as iChoosr's bulk purchase discount to reduce costs.

Other points with reference to incentives were that issues of disrepair should be included, and that fuel poor households should receive the greatest levels of help.

Providing practical support and independent advice

In addition to financial assistance or incentives, owners were seen as needing both support and advice. Those highlighting this issue included a small number of Third sector respondents. While it was noted that one-to-one home visits have proved effective in encouraging improvements and increased provision of face-to-face advice was advocated, it was also felt that this could be an extremely resource-intensive approach on the scale needed.

Other aspects seen as important in helping homeowners, in each case raised by only one or a small number of respondents, were that:

  • Information needs to be clear and easy to find.
  • Adaptation of the advice service provided by Home Energy Scotland for the 'self-funding' market was recommended.
  • Consumer protection advice is needed – for example a clear, single point of reference to allow homeowners to check claims made by businesses with respect to the availability of grants.
  • A guarantee of independent supervision and testing of work done by private contractors could provide reassurance.

Length of the period for encouraging action

Some respondents commented on the length of the proposed encouragement period, suggesting that progress of voluntary action should be reviewed on a regular basis to determine whether more support or greater regulation is needed. Third sector respondents more frequently made this point.

Ten years was seen as too long by a small number of respondents, both because the message may be lost over such a long period, and also since too little time will be left ahead of the 2040 target if voluntary action is not effective. Alternative proposals were that the period for encouraging action should be either shorter or evidence-based, or that a rate of progress below which regulation is likely to be necessary should be set, and that this should determine the point at which regulation is introduced.

Setting out a clear timeframe was also seen as providing certainty for the supply chain and a signal to the housing market that higher energy performance should be reflected in property values.

Question 9 - What information would be useful for householders to be able to access on how to achieve EPC Energy Efficiency Rating Band C before 2030?

Comments were made by respondents from a broad range of respondent types and tended to focus on access to practical information relating to:

  • The available or appropriate options for a property, individually or in combination.
  • The cost of improvements and likely savings or benefits. The need for realistic rather than indicative costs was highlighted.
  • The funding opportunities available and how to access funding.
  • Finding reliable or approved or assessors, and a simple process for obtaining quotes.

It was also argued, however, that householders should know about: the Energy Efficient Scotland Route Map and why it is important; the EPC process and ratings; the energy efficiency standards that will be required and by when they must be achieved; the Scottish Government's commitment to regulate; and the consequences of non-compliance. It was also thought that rather than emphasising the need to achieve Band C it might be better to highlight other benefits.

A requirement for significant awareness-raising and marketing activities, including messages tailored to specific audiences was suggested. The need to learn from failings of the Green Deal programme, attributed to advertising based solely on financial savings, was also highlighted. Undertaking research on what motivates householders to install energy efficient solutions was suggested, and factors identified as influential in the evaluation of Energy Efficient Scotland Phase 1 pilots[11] were noted, such as improved aesthetics and warmth, perception of good value for money, and support through the installation process. Energy Efficient Scotland Self-funding pilot projects were also identified as a potential source of guidance.

Respondents also reiterated previously raised issues concerning the EPC assessment process, highlighted the importance of definitions of technically feasible or cost-effective, or argued for credit to be given to measures not currently included.

Sources of advice or information

A small number of respondents observed that advice should be independent or impartial, and that it should be free. Other recommendations were that advice or information could be obtained from:

  • The Energy Saving Trust (EST) or Home Energy Scotland. This was the most frequently made suggestion.
  • Local Authority services.
  • Energy assessors.
  • Qualified installers.
  • An EPC for the property.

While the EPC for a property was frequently seen as the main source of information required, it was acknowledged that this requires a property to have an up-to-date EPC, which at present it may not, unless related to a sale. Encouraging or requiring homeowners to have a current EPC and to update it after making improvements was suggested, with free EPCs, or at least one free EPC to act as a benchmark, also proposed.

Other comments about EPCs were that: the format should be reviewed to provide additional or more accessible information; recommended options could be presented in a more helpful order; that information of the value of repair and maintenance could be included; or that a signpost to Home Energy Scotland could be added. Current work on the nature of EPCs being carried out by the Department for Business, Energy & Industrial Strategy was referenced.

Accountability for the quality of advice provided was also suggested to be important, and it was observed that a great deal of money can be at stake for an owner who follows the advice provided but then does not realise the predicted improvement in the EPC rating. It was argued that there needs to be a form of redress when things go wrong.

How advice is provided

Suggestions, each from one or a small number of respondents, included: provision of advice online, by telephone, face-to-face, or in the home at a time suitable to the household. The need for advice to be simple and user friendly was also noted, and it was proposed that, for vulnerable households, a handholding model such as Care and Repair would be appropriate. Other ideas were:

  • A single place to get information – such as a Home Energy Scotland 'one stop shop,' or an information hub, as proposed by the review of Each Home Counts.
  • An energy modelling software package or 'ready reckoner' to allow householders to model the effect of different measures or combinations of measures, including going beyond Band C. A small number of Third sector respondents made this suggestion.
  • A smartphone app, to improve accessibility.
  • Development of a visual tool to take users on a journey around their home to consider what measures could be installed.

Nature of advice

The need for advice to be tailored or specific to a property was suggested by a small number of respondents, as was helping to plan a number of improvements over a period of time in the form of a 'Building Renovation Passport'. It was also proposed that such a retrofit road map might be included in the EPC.

Illustration of what is possible using case studies and examples of real work, carried out on a range of different property types, was requested by a small but diverse group of respondents. It was also noted that case studies that provide an honest account of both the positive and negative experiences of other householders may help to overcome reluctance to install measures, such as internal wall insulation, that may be perceived as too disruptive. The need for specific guidance or support for owners of traditional or historic properties and tenement flats was argued and, with respect to flats, that it would be useful to illustrate the beneficial effects of building-level action.

It was also seen as important to provide information on what to expect in terms of quality of renovation work in order to build confidence in the energy efficiency market.

Ensuring that householders have access to information on the benefits of all the different technologies that are available was also suggested, as was the value of providing advice and information at key intervention points, such as the breakdown of a boiler.

Owner Occupiers: mandatory action

Question 10 - What are your views on our proposal to follow this initial period with mandating action?

Individual and Private landlord or property management respondents were amongst those expressing a clear view that the Scottish Government should not follow a period of encouragement with mandating action, which was seen as interference in a matter of personal choice. It was argued that incentives are required instead:

Incentivisation such as through taxation and green mortgages would encourage upgrades without mandatory action.
Private landlord or property management respondent

Amongst the range of respondents who supported the proposal, the most frequently made points were that:

  • Mandatory action might, or will, be needed to achieve targets. Energy related private sector, Local Authority and Building component manufacturers or services respondents were amongst those who made this suggestion.
  • The consultation paper is too vague. In order to encourage them to take action, householders need to know that mandating action will be introduced and what the sanctions for non-compliance will be. Otherwise it was felt there will be a tendency to put off making energy efficiency improvements. Local Authority and Third sector respondents were amongst those who made these points.
  • 2030 may be too late to impose mandating action if targets are to be met. Local Authority respondents were amongst those who raised this issue.
  • There must be provision to ensure that householders who are unable to afford improvements are not penalised. Local Authority and Third sector respondents were amongst those making this point. In a connected point it was recommended that in addition to those on low incomes, additional support for other vulnerable groups should be considered, and that a Health Inequalities Impact Assessment should be carried out to explore any differential impacts of the proposed plans.

Other points raised by one or a small number of respondents, and irrespective of any position taken on whether mandating action is appropriate or not, were that this may be difficult to achieve, not only in practical terms around implementation, but also in terms of gaining and maintaining public support. Application of nudge theory was proposed:

In order to make this effective, it may be beneficial to draw on behavioural insights such as 'nudge' principles. For example, if after 2030 the majority of home owners have invested in their homes to improve energy efficiency ratings, the focus of communications would be on highlighting the exception and encouraging home owners to conform.
Local Authority respondent

The legality of mandating action was also questioned and issues concerning liability for consequent failures of building fabric were raised. The possibilities of adverse effects on the housing, mortgage, and letting markets were suggested, including some homeowners being put at risk of negative equity. The independence of the EPC assessment process was argued to be essential to ensure there is no potential for the accuracy of assessments to be influenced.

It was also observed that there would need to be exceptions for hard-to-treat properties that cannot achieve a Band C rating and that specific consideration for tenements might be appropriate. Mixed tenure blocks were reported as likely to present challenges if some owners are reluctant to participate.

Enforcement

Although the intention to consult further on an enforcement method was welcomed, a small number of primarily Local Authority respondents questioned where responsibility for enforcement might lie, particularly in relation to the possible role of Local Authorities.

While several respondents agreed that the point of sale would be an appropriate trigger point for enforcement, it was also felt that this will be slow. Renovations and extensions were also suggested to present potential triggers, and it was noted that minimum performance standards could be applied to parts of a building such as windows or doors.

Question 11 - What are your views on our proposal that 2030 is the right point to start mandating action to achieve EPC Energy Efficiency Rating Band C?

Respondents at Question 11 were relatively evenly divided between:

  • Agreeing that 2030 is, or may be, the right time to start mandating action. Local Authority and Individual respondents were amongst those taking this view.
  • Agreeing the principle, but not the date proposed. Third sector, Local Authority, Energy related private sector and Individual respondents were amongst those of this view.
  • Disagreeing with mandating action. The majority of those taking this view were Individual and Private landlord or property management respondents.

2030 may be the right date

Among respondents who agreed that 2030 is appropriate, comments were that this gives enough time for action to be taken with respect to raising awareness and encouraging action and for owners to improve their properties. Some respondents added caveats, including an expectation that appropriate exceptions would be in place, that sufficient information and support including grant funding would be available, and that progress during the encouragement phase should be monitored.

2030 is not the right date

Most of the respondents who thought that 2030 is not the right date to start mandating action argued that it is too late. This frequently accompanied views expressed at Question 1 – namely that 2040 is too late as a target date to achieve EPC Band C and that the whole project to improve energy efficiency should be compressed into a shorter time frame. Specific ideas were:

  • A shorter encouragement phase, then mandating action from 2025 or 2027.
  • Mandatory requirements at point of sale from 2025.

Other points made at Question 11 were that if few home owners act on a voluntary basis during the encouragement period, too much work will be left to do at the end, with resource implications within supply chains and potentially higher costs for owners. Current improvements were argued to be running at a rate below that required. It was suggested that in the absence of mandating action, most homeowners will put off investment, particularly if it is not required before they plan to sell a property, while early mandating action can shape the property market:

Many owners will not respond unless there is the stick of penalties as well as the carrot of support…
Local Authority respondent

… regulation is essential as it will shape the market so property values reflect energy performance.
Third sector respondent

The importance of raising awareness and encouraging early action, both for home owners and in development of the supply chain were raised, as were the setting of milestones and monitoring progress. In the event of insufficient progress, it was argued that the date for mandating action should be brought forward or that the point at which action is mandated would be better determined by the rate of progress being made, rather than by setting a specific date at all. It was also thought that engagement and incentive programmes should be reviewed in the event of insufficient progress.

Other proposed actions, each suggested by one or a small number of respondents, were:

  • Research to model the uptake of measures under a variety of scenarios.
  • An assessment of the impacts of the proposals on those households most in need of improvement.
  • The early development of regulations, making it possible to foreshadow regulation and encourage voluntary action in advance.

In contrast to the view that 2030 is too late to start mandating action, a small number of respondents thought it is too soon. It was argued that this does not give owners a reasonable time to prepare, particularly since the UK Government has yet to provide guidance on gas decarbonisation.

There should be no mandating action/ Band C is too high

Some respondents, predominantly Individuals, argued that there should be no mandatory action at all, often making clear their comments related particularly to the owner occupied sector. Reasons given were that the rating proposed is unrealistic or unachievable in certain circumstances, that the EPC system is not satisfactory, and that mandatory action may have a detrimental impact on the property market. Instead it was argued that the approach taken should involve only encouragement and support for voluntary action.

Most people want to live in an energy efficient property and will take action if they can afford to do so, but it is an infringement on personal choice to penalise those who do not want to or cannot afford to upgrade their own homes.
Private landlord or property management respondent

Other perspectives and ideas

Some respondents did not take a clear position on the suitability of 2030 as a date at which to start mandating action, but made points relating to: the efficiency standard to be set; the methodology of the current EPC system; the need to determine the level of support available before mandating action; or the need for regular reviews to assess progress and to determine whether a mandatory phase is needed at all. It was also noted, however, that not every home has an EPC, so producing a baseline may not be straightforward.

There were other propositions to which no specific date was attached, which were put forward by one or a small number of respondents:

  • Mandatory action should be only when the market is ready to support delivery.
  • Mandatory action should be at the point of sale or rent.
  • Attachment of an advisory note to the EPC of a property for sale highlighting the measures that would be required to bring the property up to any higher rating necessary.

Question 12 - What are your views on our proposal for owner occupied properties to be subject to penalties for non-compliance?

The consultation paper notes that, if the Scottish Government does mandate that owner occupiers improve their properties, this is likely to be accompanied by financial penalties for non-compliance. Detail of how standards would be required and enforced would be subject to further consultation ahead of their introduction.

Some respondents, including Local Authority, Third sector, Energy related private sector, Building component manufacturers or services and Individual respondents, thought that owner occupied properties should be subject to penalties for non-compliance, making arguments that a voluntary system alone is unlikely to be effective and that some form of deterrent will be required to encourage action.

Without penalties the process will not succeed. We hope that over the course of the next 20 years, very few people will fall foul of them; but without sanctions, there will be much less incentive to go early.
Energy related private sector respondent

A smaller number of respondents, including Individual and Private landlord or property management respondents, did not consider a penalty for non-compliance to be advisable or acceptable. They argued that the policy compromises freedom of choice, is not possible or practical in some cases or may have adverse effects on the housing market. For example:

It would also discourage people from buying property, particularly at the lower end of the market, if they fear the additional costs that this could bring. That could make it harder for people to get on the housing ladder and lead to greater competition for renting instead…
Professional or representative body respondent

Other respondents observed that they were unable to comment without more detail on the nature of enforcement or penalties proposed, or suggested that the proposal requires further careful consideration. It was also argued that the public may not support a punitive system.

Other comments on the possible use of penalties were:

  • It would be preferable to achieve the desired outcomes using encouragement and incentives.
  • Any penalties should be financial not criminal. Third sector respondents tended to make this observation.
  • Penalties must be fair, reasonable and appropriate, but also need to be large enough that people will not just choose to pay a fine.

The need to consider mitigating circumstances before applying any penalty was also highlighted, with respondents emphasising the need to protect vulnerable or fuel poor households, but also to consider the situation of owners who are not able to pay and who may not be able to access grant schemes. Other situations seen as requiring flexibility were mixed tenure buildings where common works may be blocked, and properties requiring technical exceptions. Establishment of an independent regulatory and appeals process to ensure that an assessor's recommendations for a property are suitable, was seen as essential if penalties are to be applied.

The difficulty or cost of enforcing penalties was also highlighted, as was the need to provide adequate resources for administration, and the potential scale of enforcement that could be required. There were queries with regard to who would be expected to enforce penalties and suggestions that suitable powers to enforce would be required. Clarification of how enforcement action fits with a homeowner's legal ownership rights was also called for. Local Authority respondents were particularly likely to raise one or more of these issues.

Regulating at the point of sale and using the conveyancing process to facilitate compliance was seen as minimising the need for penalties, and avoiding a situation where a household that cannot afford to comply is subject to a financial penalty. If a property was sold with an EPC rating below the standard required, it was argued this would be reflected in the price, and the buyer would then need to make the necessary improvements. The rate of LBTT was also advocated as a tool for encouraging compliance – with proposals including a variable LBTT rate according to the EPC banding of a property, or that a buyer could claim a LBTT rebate based on energy efficiency measures installed over a fixed period of ownership.

It was also noted that it would be possible to prevent registration of change of ownership until compliance is achieved. With respect to properties that do not come to the sale or rental market, it was thought that enforcement orders might be considered.

Another proposal on trigger points was use of consequential improvements, with enforcement by means of building warrant procedures, although it was acknowledged that this would affect only a small percentage of properties.

Ideas about how a penalty might be applied were more limited than ideas on how it might be avoided, but included:

  • Variation in council tax according to energy rating. As an alternative to raising council tax on homes that do not comply, reducing council tax for energy efficient homes was identified as having potential to increase the value of a property, outweighing the cost of improvements.
  • A penalty equivalent to a percentage of a property's rateable value.

Homes outside of the existing mandatory EPC process

The consultation paper notes that some types of homes are currently outside of the existing mandatory EPC process – upon which it is proposed that the LTDS will be based. This includes mobile or park homes, agricultural homes such as agricultural tenancies and crofts, Houses in Multiple Occupation (HMOs) and holiday lets.

Question 13 - What are your views on requiring all types of accommodation to meet the Long-Term Domestic Standard over time?

Please explain your answer, giving examples of accommodation you think should / should not be required to meet the Long-Term Domestic Standard if relevant.

Some respondents, from across a broad range of respondent types, commented that all types of accommodation should meet the LTDS, highlighting the importance of combating fuel poverty, meeting carbon emissions targets, or noting that the accommodation types currently excluded may house some of most vulnerable groups in society. The value of consistency across sectors and the fluid relationship between sectors were also referenced.

Other respondents suggested qualifications, to the effect that the standard should apply to a principal home, sole residence or permanent residence, or to a property with solid foundations or serviced by utilities. A need to define or exclude temporary accommodation was also identified, and that the standard might apply only to domestic property that is inhabited for minimum period within a year. The need for exceptions was also noted. This range of issues was raised across respondent types.

Alternative views, each expressed by one or a small number of respondents were: while there should be consistency, this should not be based on the EPC system or should not require achieving a Band C rating; that there should be no blanket standard and properties should be approached on a more pragmatic, case-by-case basis; and that there should not be any mandatory requirement to meet energy efficiency standards.

Additional suggestions were the need further research and analysis, and that a national feasibility study should be carried out.

Mobile or park homes

Among those who commented specifically on park homes or mobile homes there were mixed views, both that this type of property should be included and that it should not. Energy related private sector, Local Authority and Individual respondents were amongst those thinking they should be included. Other Local Authority respondents were amongst those who thought they should not.

Technical difficulties or challenges and the likely need for exceptions were all suggested, as was a separate energy rating scale for park homes or a concentration on enforcement of energy efficiency standards for new or replacement homes.

Other comments were that static caravans that are not designated as park homes should be included, as their occupants cannot currently access any funding for heating or insulation, and also that energy prices on park home sites are typically higher because supplies are charged at commercial rather than domestic rates.

Agricultural tenancies

The majority of those who commented specifically on agricultural tenancies, including Local Authority and Third sector respondents, argued that these should be covered by the LTDS, in part because many households inhabiting such properties live on low incomes or are fuel poor. Extension of the Repairing Standard to agricultural tenancies was also recommended.

However, there was also opposition to inclusion of agricultural tenancies, or a view that a tailored approach will be required since there is no residential rent for the farmhouse, and repairing obligations are often the responsibility of the tenant. A small number of Private landlord or property management and Professional or representative body respondents were amongst those with this view. It was suggested that if faced with being forced to pay for energy efficiency improvements with no means of recouping costs, some landlords will choose to sell farmhouses or rent them out separately. It was proposed that improvement work should be carried out by the tenant, and that it should be valued at the end of the tenancy. Alternatively, it was suggested that improvement should be carried out only if a mutually acceptable rent increase can be agreed.

With respect to rented crofts, it was felt that due to the security of tenure, croft and smallholding houses should be considered as owner occupied houses for the purposes of energy efficiency improvements.

Houses in Multiple Occupation

A very substantial majority of those who commented on HMOs, including those from a broad range of respondent types, argued that these should be covered by the LTDS, reasoning that such buildings are typically occupied by young people or people on low incomes who have little power to demand improvements. It was also noted that the standard for HMOs makes no reference to a property being warm or affordable to heat. Suggestions were that HMOs should be required to display an annually updated EPC as a condition of their licence, but also that some improvements would not be technically feasible or cost-effective.

Holiday lets

A majority of respondents who commented on holiday lets or short-term rentals argued that these should be included, primarily because failure to do so would give owners an opportunity to avoid regulatory standards applying to the remainder of the PRS. Local Authority, Third sector and Individual respondents were amongst those with this view.

…if holiday homes are not required to meet energy efficiency standards, then there is the opportunity for landlords to designate their properties as holiday lets – leading to no energy efficiency improvements.
Local Authority respondent

Other reasons given were that properties can quickly be transferred between holiday lets and long-term rental, and that since the owner generally pays utilities bills for holiday properties, there is no incentive for occupants to conserve energy.

Those respondents who did not think holiday lets should be required to meet the LTDS included Private landlord or property management and Professional or representative body respondents. They argued that energy efficiency is not a matter of primary concern to most holiday makers:

There does not appear to be any need for holiday homes to be included… There is a plentiful supply and choice for holidaymakers to choose more energy efficient accommodation if that is their preference. The very nature of such stays is predominantly short-term reducing the need for such properties to meet high energy efficiency standards.
Private landlord or property management respondent

Other respondents commented that holiday lets may only be used on a seasonal basis or gave examples of many non-standard properties such as wigwams, chalets, cabins or caravans that may be found in this sector. It was also argued that to subject holiday lets to the Repairing Standard or the LTDS will be both impractical and damaging to tourism, and that exemptions from compliance with EPC requirements should be granted, as in other EU countries.

Higher targets for Fuel Poor Homes

Finally in this section, the consultation paper asks two questions on proposals specifically concerning fuel poor households.

On 27 June 2018, the Scottish Government published a Draft Fuel Poverty Strategy to accompany the Fuel Poverty (Target, Definition & Strategy) (Scotland) Bill. Based on the principles of fairness and equality, the Draft Strategy sets out a new approach proposing working across government to tackle all four drivers of fuel poverty: incomes, energy prices, the energy efficiency of homes, and behaviours in the home. It recognises the need to ensure this work aligns with other strategies to tackle poverty, reduce child poverty, improve health outcomes and make Scotland a fairer country. As part of this approach is the ambition to remove poor energy efficiency as a driver of fuel poverty – the Energy Efficient Scotland Programme is the mechanism through which this ambition will be achieved.

The consultation notes that, due to the depth of fuel poverty experienced by some households, reaching EPC Band C by 2040 will not be enough to lift them out of fuel poverty and that more ambitious targets are needed. The proposal is therefore that all homes with fuel poor households should achieve band C by 2030, where technically feasible and cost-effective, and Band B by 2040. Since reaching Band B will require significant intervention, at this stage it is not thought appropriate to make such ambitious targets mandatory across the entire residential building stock. However, the target will act as a guide for national and area based fuel poverty programmes that will operate throughout the lifetime of the Energy Efficient Scotland programme, building on existing schemes in operation. In practice this will mean maximising the level of improvement possible, whilst remaining affordable for the public purse.

Question 14: Please provide your views on our proposal that all homes with fuel poor households are to reach EPC Energy Efficiency Rating Band C by 2030, where technically feasible and cost-effective?

Some respondents who indicated general agreement with the proposal, or who agreed in principle, highlighted the importance of removing poor energy efficiency as a driver for fuel poverty or noted associated potential benefits such as improved health outcomes. These respondents came from a broad range of respondent types and included a number of Individual respondents in particular.

There were also suggestions that a more ambitious, generally earlier, target would be welcome; and that the target should apply to all on low incomes, not just those in fuel poverty. Given other proposals for standards in the PRS and social sectors, it was observed that this provision would apply to the owner occupied sector, but also that it might help with delivery of EESSH targets in mixed tenure areas. A small number of Local Authority and Third sector respondents were amongst those who raised this issue.

While a small number of respondents noted their approval as conditional on the caveat of 'technically feasible and cost-effective', it was also felt that while 'technically feasible' should be defined narrowly, 'cost-effective' should be as interpreted as flexibly as possible to ensure as many households as possible are helped.

Some respondents who did not agree with the proposal reiterated views on flaws in EPC methodology or on the principle of setting energy efficiency standards at all. It was also felt that the target may be undeliverable, would be difficult to monitor, and that rather than attempting to target fuel poor households, the Scottish Government should adopt more ambitious targets overall. Local Authority respondents were among those who argued that instead of setting specific targets for energy efficiency in fuel poor households, it would be preferable to have a single standard for residential property and to provide additional financial support to fuel poor households.

Identification or targeting of households in fuel poverty

A small number of Local Authority respondents were amongst those questioning how fuel poor households would be identified. It was also noted that whether or not a household is in fuel poverty will change over time according to personal circumstances, and a question posed about how long a household would need to be fuel poor before qualifying for assistance. The need for an effective system for collecting and sharing data to identify fuel poor households was also seen as being of fundamental importance.

It was suggested that signposting and partnership working by key stakeholders, such as Local Authorities, health organisations and appropriate charities, supports identification of fuel poor households including those who might not be identified through other channels. However, it was also observed that fuel poor households may have no interest in self-identifying unless grants are available.

It was noted that recent changes to the definition of fuel poverty[12] require more detailed personal financial information to be gathered, but it was also thought that proxies will still be needed when seeking to identify fuel poor households. Examples were: low ranking in the Scottish Index of Multiple Deprivation, low council tax band, or being in receipt of certain benefits. Although proxies are used to identify area based schemes, it was suggested this will be more difficult if funding is targeted solely at fuel poor households.

The complexity of fuel poverty and the importance of other drivers such as income, fuel cost, and life style choices were highlighted, and the Scottish Government was advised to link energy efficiency to other strategies relating to tackling drivers of fuel poverty. The importance of providing advice to occupants on how changing their behaviour can save energy was also highlighted.

A small number of Local Authority respondents were among those who argued that given the mobility of fuel poor households, the energy efficiency of a building should be the focus rather than the financial position of a particular household.

How improvements would be financed

There were queries regarding any intention to subject fuel poor owner occupied households to mandatory regulation, with respondents arguing that this would be inappropriate. How the target will work in practice if not mandatory was considered unclear.

Some respondents raised issues associated with financing of the required improvements, for example that significant funding will be required. Continuation and expansion of existing funding streams such as the HEEPS: Area Based Scheme and Warmer Homes Scotland were suggested, as was the potential of the Energy Company Obligation (ECO) programme. It was also suggested there should be no cap per household to allow a whole-house approach to be adopted. There was a call for support and encouragement to private landlords and homeowners to take advantage of area based schemes.

Rural communities

Specific issues were raised with respect to alleviation of fuel poverty in rural areas, for example that additional support may be required. It was reported that fuel poor rural households may be hidden under the new definition of fuel poverty, and that many fuel poor households in rural areas are living in hard-to-treat properties that are off-gas grid. There was a view that these properties would not be cost-effective to upgrade, and so these fuel poor households would not be helped by the proposed measures. A more general need to consider an approach for properties built before 1919 was also identified.

Question 15 - Please provide your views on our proposal that all homes with fuel poor households are to reach EPC Energy Efficiency Rating Band B by 2040, where technically feasible, cost-effective and possible within limits affordable to the public purse?

Views expressed at Question 15 tended to reflect those at Question 14, and a number of respondents simply referenced their previous answer.

Some respondents agreed with the ambition that all homes with fuel poor households should reach Band B by 2040 or agreed in principle. These respondents came from a broad range of respondent types, with Energy related private sector, Local Authority, Third sector and Individual respondents having a particular presence.

Comments noted the value of setting out a long-term trajectory, and that it may be most cost-effective to improve to EPC B in one go. It was also suggested that the proposed approach is pragmatic, and the target is challenging but in line with fuel poverty and climate change objectives.

Setting a clear long-term trajectory is essential. By setting out the band B target, Government should encourage households to undertake works to bring their home up to band B in one go rather than incurring incremental changes which could in the long term prove costlier.
Building component manufacturers or services respondent

A small number of respondents expressed views that the target could be more ambitious in terms of the date, the energy efficiency level achieved, or the types of household covered. For example:

The sooner the better. We had hoped that a more ambitious target which improved the circumstances for the people of Scotland living in energy inefficient homes would be proposed. Winters can be very cold in Scotland and in [our] experience it is often the most vulnerable people who are living in the most energy inefficient homes.
Third sector respondent

Respondents who did not agree with the proposal also came from a broad range of respondent types with Individual respondents again having a notable presence. Comments were that the proposed standard may be too ambitious or unattainable, or should not apply to the owner occupied sector, unless completely funded from the public purse. Overall, the balance of opinion was that fewer respondents disagreed than agreed.

Cost of achieving EPC Band B

A small number of respondents argued that EPC B is a very high standard that will require significant funding. The potential need for installation of renewable technologies was identified, although it was also thought that while improving an EPC score, such technologies may have limited benefit for the occupants of a property. Technical feasibility and legal issues were also identified as potential difficulties, particularly with respect to properties with areas held in common ownership, as were current restrictions on the grant to landlords owning more than one property.

The investment required to achieve a Band B rating, and whether this necessarily represents the best value for money. was questioned, with suggestions that there are other ways to address fuel poverty which may have a greater impact. A cost benefit analysis was proposed. In particular it was argued that there is little difference between a high Band C and low Band B in terms of running costs, carbon emissions or comfort for the household, and that a better strategy might be to get all properties to Band C before targeting Band B for fuel poor households.

Given the required level of investment to achieve Band B it was agreed that it this should not be a statutory target.

It was also argued, as at the previous question, that the energy efficiency of a building should be the focus of attention rather than the financial position of the household, and that there is a risk that after significant investment to bring a property to a high standard, the fuel poor household may wish to move. For fuel poor tenants, it was felt that a lack of EPC B compliant properties might limit their choice.

Other issues raised

Other points raised at Question 15 were:

  • It is important that the Band B efficiency requirement is applied to new build homes to avoid the need for upgrades in the future.
  • Fuel poor households may not be welcome as PRS tenants if a prospective landlord anticipates an additional requirement to upgrade as a consequence.

The wording of Question 15 incorporates significant get-out clauses, and the 'within limits affordable to the public purse' needs to be explained and defined.


Contact

Email: Energy Efficiency Scotland 2018