Energy Performance of Buildings (Scotland) Regulations 2025: island communities impact assessment

Step Four – Assessment

Potential Issues Identified

From the literature review, formal consultation responses, workshop feedback, and interactions with the public (including email enquiries) we have identified a number of relevant potential issues for islands relating to these reforms:

• Availability of assessors to meet potentially increased demand due to changes in the validity period;
• Cost of an EPC, and of compliance with the Energy Performance of Buildings regulations due to changes in the validity period;
• EPC rating changes – the impact of introducing additional ratings, including on fabric performance. This would mean properties off-gas grid would not be penalised based on using higher cost fuels; and
• Importance of current and prospective building owners and tenants receiving information about the energy efficiency of buildings and how energy efficiency could be improved (including through Government delivery schemes).

Availability of Assessors

The geographical challenges and potential for travel disruption within and between Scottish island communities is well-documented. EPC assessors (other than for new buildings) need to physically visit buildings in order to complete their assessment. Therefore, there is a potential issue given assessors may be unable or unwilling to travel significant distances in order to carry out an EPC assessment.

For the most part, while this issue affects island communities, it is primarily an issue of geography and practicality of delivering EPC assessments in person. Travel disruption due to the dependence on the availability of ferries, or planes, is an islands specific issue.

The existing mitigation set out in regulations (which will be retained in the revised regulations) provides for a defence from prosecution from specified regulations where the building owner has made reasonable efforts to obtain an EPC, but has been unable to do so. This defence is likely to mitigate circumstances in which a building owner on an island community is unable to obtain an EPC due to transport disruption.

This issue is unlikely to be relevant to the introduction of on-site auditing as part of the new Operating Framework. This is because it is proposed that auditors will be employed by the Scottish Government and travel as required to carry out site-based audits of a small number EPCs. This means that island communities will benefit from the same level of assurance as mainland communities.

Cost of an EPC

Literature suggests that Scottish Island communities experience acute cost of living pressures, higher costs of fuel, and a colder climate than mainland areas^[34]. EPCs generally cost in the region of £100 for a domestic certificate, and non-domestic certificates range in price. Anecdotal evidence from engagement with local authorities on islands suggests that EPCs are generally more expensive than on the mainland due to increased transport costs for assessors.

Impact of change to EPC validity period

We do not anticipate any change to the cost burden for EPCs from reduction in the validity period for those living on islands seeking to advertise a property or sale. This is because, in these cases, production of a new EPC is always required, regardless of whether or not there is already an existing, valid EPC. Likewise for properties which have been constructed on an island, as with elsewhere in Scotland, a new EPC will always be required to be produced.

For two specific cases, there will likely be an increase in the overall cost burden of EPCs due to the reduction in the validity period of EPCs from 10 years to five. This relates specifically to those properties on islands which are advertised for let, or to large public buildings located on islands which are required to always display a valid EPC. The reduction in the validity period will ensure the information prospective building owners or tenants receive is more up to date. However, for landlords, this is likely to increase costs if tenants move out between five and ten years after a let is agreed (i.e. the difference between the current and previous validity periods).

This is not considered to be an islands’-specific issue as it also affects buildings in rural and remote mainland areas, and indeed throughout Scotland, although we do note that the reported additional cost of obtaining an EPC in island areas due to additional travel costs would be an additional cost specific to these communities.

EPC Rating Changes

The reformed domestic EPC introduced through the revised regulations will include three ratings:

• Heat Retention Rating – reflecting the performance of the building fabric (i.e. how well insulated the building is);
• Heating System Rating - reflecting the emissions and efficiency of the heating system; and
• Energy Cost Rating - reflecting the how efficient the building is to run in terms of the cost of energy.

The current domestic EPC has two ratings:

• Energy Efficiency Rating – based on how efficient the building is to run in terms of the cost of energy
• Environmental Impact Rating – based on the emissions from the building

Buildings in many island communities do not have access to the gas grid, and often rely on more expensive heating fuels (such as oil, LPG, or biomass). The current Energy Efficiency Rating of such buildings is likely to be lower than if they were heated by mains gas, which is common in many areas of the mainland. These buildings are likely to achieve a better rating in the new Heat Retention Rating than they achieve in the Energy Cost Rating, given the Heat Retention Rating does not include the impact of fuel cost.

While this impacts island communities, it is not an islands’-specific impact. This is because while the majority of urban dwellings are within the coverage of the gas grid, whereas almost two-thirds of rural dwellings are not^[35]. There are 1,676 domestic gas grid connections in Stornoway and 3,486 domestic gas grid connections on Bute^[36]. There is no evidence of gas grid connections on any other Scottish islands. All other island residents rely on solid fuel (coal or biomass), heating oil or electricity to heat their homes and businesses.

Energy Efficiency Information

The reformed EPC will provide clearer information about the areas of the building that could be improved to increase energy efficiency, and move to clean heating. EPCs are also relied upon by various Scottish and UK Government schemes. If buildings in island communicates have up-to-date EPCs, their owners will be more aware of, and able to access, Government support for energy efficiency and clean heating.