Heat in Buildings: progress report 2025
Annual update on progress against our Heat in Buildings Strategy and Monitoring and Evaluation Framework.
4. Activities (policy and delivery)
4.1. Activities: delivery schemes
4.1.1. Type: funding schemes – energy efficiency, clean heat and microgeneration:
Our delivery schemes continue to provide funding through grants and loans to homes and businesses to install energy efficiency measures and clean heating systems, including targeted support for those in or at risk of fuel poverty. We summarise progress where data is available for the financial year 2024 – 2025. For Area Based Schemes (ABS) the most recent data available is for the 2023 – 2024 financial year.
4.1.1A Indicator: number of improvement measures supported across all delivery schemes by sector during the last year:
- domestic – owner-occupier
- domestic – private rented sector
- domestic – social rented sector
- non-domestic – small and medium-sized enterprises (SME)
- non-domestic – public sector
Data source: Scottish Government delivery scheme data
Unit: number of installed measures[35]
In this year’s progress report, we report on the number of energy efficiency, clean heat[36] and other renewables[37] (e.g., microgeneration) measures installed per annum that are relevant to our strategy’s outcomes. This metric does not equate to the unique number of properties supported across our schemes since the same property could receive a number of measures. However, we include data on the number of properties supported by a scheme where it is available. (The exception to this is for the SHNZHF, where we report on the number of properties installing improvement measures.) We are currently unable to split this data out by tenure for all schemes, as intended but we are working on introducing this.
We are continuing to explore ways to improve our reporting across our delivery schemes, and we may therefore update some of the delivery scheme data after this document has published as we continue the process of verification.
Most recent data: Most recent data for schemes are for the financial year 2024-25, except the ABS, where the most recent data are for 2023-24. For the Scottish Central Government Energy Efficiency Grant we report data for calendar years. We also provide historic data for all schemes where available.
Commentary:
Home Energy Scotland (HES) Grant and Loan Scheme
The scheme provides grants and loans to install clean heat and energy efficiency measures and is open to all domestic owner-occupiers in Scotland. Data are presented for both the HES Grant and Loan scheme and the HES Loan and Cashback scheme, with the former having replaced the latter in December 2022. We have made necessary changes to the HES Grant and Loan scheme to ensure available funds are targeted at measures which best support direct decarbonisation of heat in existing homes, such as removing hybrid heat pumps, solar PV and battery as eligible measures and the eligibility of self-builders for funding.
Data are only presented broken down by wider categories of measure for 2023 – 2024 and 2024-25. In the table below, ‘other energy efficiency’ measures include secondary glazing, wastewater heat recovery systems, heating controls, cylinder thermostat and hot water tank jackets. It also includes gas boilers, for which numbers have been low. ‘Other renewables’ include heat meters, wind turbines and hydro turbines.
The decrease in the overall number of applications is a result of the removal of eligibility for the installation of solar measures between 2023 and 2024, allowing us to prioritise finite funding for heat pump installations and energy efficiency measures. These measures directly contribute to the decarbonisation of a home’s heating and reduce heat demand which would be less likely to happen without government support.
| 2019-20 | 2020-21 | 2021-22 | 2022-23 | 2023-24 | 2024-25 | |
|---|---|---|---|---|---|---|
| Energy efficiency | 997 | 615 | 796 | 1,013 | 2,030 | 1,960 |
| Other renewables/clean heat | 965 | 783 | 2,115 | 4,983 | 8,989 | 5,396 |
| 2023-24 | 2024-25 | |
|---|---|---|
| Energy efficiency | 2,030 | 1,960 |
| Of which, insulation | 1,721 | 1665 |
| Of which, other energy efficiency | 309 | 295 |
| Other renewables/clean heat | 8,989 | 5,396 |
| Of which, ZDEH /biomass | 2,306 | 2,658 |
| Of which, solar PV | 3,368 | 1,319 |
| Of which, battery storage | 3,216 | 1,406 |
| Of which, other renewables | 99 | 13 |
Note: ZDEH includes heat pumps.
Warmer Homes Scotland
Warmer Homes Scotland (WHS) is the Scottish Government's national fuel poverty programme designed to help those households living in or at risk of fuel poverty, through the installation of measures such as insulation and clean heating systems in their homes. Households will be offered a clean heating system in the first instance, if technically appropriate, but these systems will not be installed in households where it would push people into fuel poverty or worsen the depth of fuel poverty.
The scheme mainly supports owner occupiers, but it also covers tenants in private rented homes. It has been operating since September 2015 and has helped more than 46,000 households throughout Scotland. We launched the new phase of WHS on 2 October 2023, with a greater focus on clean heating where this is both financially and technically feasible. The higher grant limits per household allow us to deliver whole-house retrofit and install more measures in individual properties.
We provide data for the number of measures installed under both the previous and current schemes in the tables below[38]. Since 2019, we have seen a steady increase in the number of clean heat installations the majority of which have been heat pumps and new electric storage heating. In 2024-2025, WHS supported 7,334 households with 14,778 heating, insulation and renewable measures installed. The programme continues to install new gas boilers. This is because gas boilers can currently be cheaper to run due to high electricity costs and are able to be installed quicker.
The first months of the new scheme were focused on servicing priority customers who had been waiting while the scheme was paused. We expect that this increased the proportion of fossil fuel heating installed to date. We are now seeing higher levels of clean heating and we are reviewing the processes in the scheme to see where this can be increased further.
| 2019-20 | 2020-21 | 2021-22 | 2022-23 | 2023-24 | |
|---|---|---|---|---|---|
| Energy efficiency | 6,682 | 6,620 | 10,174 | 10,638 | 5,665 |
| Of which, insulation | 3,918 | 3,703 | 6,390 | 6,902 | 3,691 |
| Of which, gas boiler (condensing)/LPG/Oil[40] | 2,764 | 2,917 | 3,784 | 3,736 | 1,974 |
| Other renewables/clean heat | 430 | 405 | 668 | 1,204 | 794 |
| Of which, ZDEH/biomass | 409 | 383 | 564 | 742 | 506 |
| Of which, solar PV/solar thermal/battery storage | 21 | 22 | 104 | 462 | 288 |
Note: ZDEH includes heat pumps.
| 2023-24[41] | 2024-25 | |
|---|---|---|
| Energy efficiency | 3,607 | 12,797 |
| Of which, insulation | 2,264 | 7,839 |
| Of which, gas boiler (condensing) | 1,343 | 4,958 |
| Other renewables/clean heat | 472 | 1,981 |
| Of which, ZDEH/biomass | 157 | 1,024 |
| Of which, solar PV/battery storage | 315 | 957 |
Note: ZDEH includes heat pumps.
Area Based Schemes (ABS)
Our ABS aim to reduce fuel poverty by enabling local authorities to design and deliver energy efficiency projects in fuel poor areas. ABS focuses primarily upon insulation measures benefitting 'hard to treat' properties, but also delivers clean heating and microgeneration measures as part of a ‘whole house’ approach. Local schemes meet most or all of the cost of improvements for owner occupiers and eight out of ten private landlords. This often enables improvements to mixed tenure buildings to go ahead, matching investment by social landlords and benefitting whole communities. Data for the financial year 2024-25 will be published separately as part of the regular Area Based Schemes: annual final measures report.
In the last reported financial year (2023-24), ABS projects helped reduce energy bills for just under 5,000 households living in or at risk of fuel poverty. The scheme installed 3,559 energy efficiency measures in 2023-24, as well as 2,375 clean heat and renewables measures (1,279 of which were solar PV). The programme has delivered increasing numbers of renewables and clean heating systems since 2019.
| 2019-20 | 2020-21 | 2021-22 | 2022-23 | 2023-24 | |
|---|---|---|---|---|---|
| Energy efficiency | 7,758 | 5,745 | 4,288 | 4,571 | 3,559 |
| Of which, insulation | 7,737 | 5,715 | 4,287 | 4,497 | 3,515 |
| Of which, gas boiler | 21 | 30 | 1 | 0 | 0 |
| Other renewables/clean heat | 162 | 340 | 2,973 | 2,460 | 2,375 |
| Of which, ZDEH/biomass | 98 | 107 | 151 | 207 | 122 |
| Of which, solar PV | 0 | 144 | 583 | 2,253 | 1,279 |
| Of which battery storage | - | - | - | - | 914 |
| Of which, heating controls | 64 | 89 | 2,239 | 74 | 44 |
Note: ZDEH includes heat pumps.
Private Rented Sector Landlord Loan Scheme
The Private Rented Sector (PRS) Landlord Loan Scheme provides private registered landlords with interest free and low interest loan funding to enable them to invest in improving the energy efficiency of their properties and install clean heating systems.
The scheme is demand-led and open to landlords who choose to apply. However, as private landlords are commercial providers operating in a private market, we recognise that many may choose to fund or finance improvements to properties privately.
Since its launch in 2020, the scheme has supported landlords to install over 350 energy efficiency and clean heating/renewable measures.
The ‘other energy efficiency’ category includes gas boilers and connections (which are no longer eligible for funding as part of the scheme), heating controls and warm-air units. The clean heating systems installed in 2023-24 and 2024-25 consist of high heat retention electric storage heaters and air source heat pumps. There was a shift between 2022-23 and 2023-24 away from energy efficiency installations towards other renewables and clean heat installations.
| 2020-21 | 2021-22 | 2022-23 | 2023-24 | |
|---|---|---|---|---|
| Energy efficiency | 51 | 116 | 78 | 59 |
| Other renewables/clean heat | 5 | 13 | 7 | 22 |
| 2024-25 | |
|---|---|
| Energy efficiency | 13 |
| Of which, insulation | 11 |
| Of which, other energy efficiency | 2 |
| Other renewables/clean heat | 17 |
| Of which, ZDEH/biomass | 10 |
| Of which, solar PV | 4 |
| Of which, battery storage | 3 |
Note: ZDEH includes heat pumps.
Social Housing Net Zero Heat Fund (SHNZHF)
The SHNZHF offers capital grant funding to support social housing landlords across Scotland to install clean heating systems and energy efficiency measures.
‘Other measures’ in relation to energy efficiency include mechanical ventilation heat recovery, heating controls and thermostatic radiator valves, hot water cylinder jackets and air tightness measures. Biomass is not reported below since the scheme has not supported any installations.
Data are presented from 2021 because SHNZHF launched in August 2020 and the data have been ascribed to the financial year in which each project was completed. Data for the wider energy efficiency categories of measures were only collated from 2023-24. We plan to continue to report this way in future years.
In 2024-25, the scheme supported over 1600 social housing properties to install energy efficiency measures and over 780 properties to install renewables and/or clean heat measures. These contribute to reducing the cost of energy that social housing tenants pay in these properties, consistent with our wider efforts to tackle fuel poverty, and reducing the carbon emissions of these properties.
The figures presented in Table 22 are estimates based on initial project scopes and will be updated upon full project completion and reporting to Scottish Government.
| 2021-22 | 2022-23 | 2023-24 | 2024-25 | |
|---|---|---|---|---|
| Energy efficiency | 168 | 32 | 7,381 | 3,403 |
| Of which, insulation | 168 | 32 | 1,250 | 1,661 |
| Of which, windows/glazing | N/A | N/A | 422 | 664 |
| Of which, doors | N/A | N/A | 77 | 778 |
| Of which, other measures | N/A | N/A | 5,632 | 300 |
| Other renewables/clean heat | 771 | 1,299 | 2,759 | 1,356 |
| Of which, ZDEH | 159 | 663 | 1,317 | 723 |
| Of which, solar PV | 463 | 473 | 1,183 | 352 |
| Of which, battery storage | 149 | 163 | 259 | 281 |
Note: ZDEH includes heat pumps.
SME loan and cashback scheme
This scheme supports Scottish organisations to install energy efficient and renewable technologies to cut carbon emissions and reduce energy costs, thereby increasing economic competitiveness. It provides unsecured, interest free loans of up to £100,000 to SMEs, not-for-profit-organisations and charities. A cashback grant has also been available since 2018.
In 2023, solar PV became ineligible under the scheme to align with the Heat in Buildings Strategy. ‘Biomass’ includes biomass boilers for all years and biomass room heaters from 2022-23.
There are minor changes to the total figures for each year as Energy Saving Trust makes updates in historic data. Reasons for these changes can include date corrections, delays in applications being marked as fully paid, and applicants removing a measure from an application. ‘Other’ energy efficiency measures were erroneously included in the "insulation" category in the previous report. This has now been corrected.
| 2019-20 | 2020-21 | 2021-22 | 2022-23 | 2023-24 | 2024-25 | |
|---|---|---|---|---|---|---|
| Energy efficiency | 219 | 213 | 346 | 284 | 266 | 441 |
| Of which, insulation | 23 | 35 | 71 | 76 | 51 | 129 |
| Of which, gas boiler | 48 | 28 | 30 | 10 | 3 | 9 |
| Of which, heat meters | 4 | 2 | 7 | 2 | 6 | 6 |
| Of which, other measures | 14 | 148 | 238 | 196 | 206 | 297 |
| Other renewables/ clean heat | 21 | 26 | 113 | 150 | 154 | 74 |
| Of which, ZDEH/biomass | 13 | 13 | 93 | 92 | 62 | 57 |
| Of which, solar PV/wind turbine | 8 | 13 | 19 | 46 | 69 | 9 |
| Of which, battery storage | 0 | 0 | 1 | 7 | 20 | 6 |
| Of which, solar thermal | 0 | 0 | 0 | 5 | 3 | 2 |
Note: ZDEH includes heat pumps.
Scottish Green Public Sector Estate Decarbonisation Scheme
The Scottish Green Public Sector Estate Decarbonisation scheme is the main government-led capital funding mechanism to support decarbonisation of buildings owned by the public sector. The scheme is a commitment over the Parliamentary term ending in 2026.
The scheme comprises four support elements for public sector bodies:
2. The Scottish Central Government Energy Efficiency Grant Scheme
3. The Scottish Public Sector Energy Efficiency Loan Scheme
4. Scotland’s Public Sector Heat Decarbonisation Fund
The NDEE Frameworks and PSU, which support public, and third sector organisations to retrofit their buildings, are in the process of re-procurement. Once the procurement exercise is complete, links to framework documentation and buyer's guides will be made available online.
We present data below on the number of energy efficiency, clean heat and renewables measures installed in public sector buildings as part of these schemes.
During 2024-2025, there was a reduction in the availability of funding for new projects, which led to a corresponding decrease in the number of new heat installations undertaken. It is important to note that installations within public sector buildings typically result in significant carbon savings per measure due to the scale and nature of the buildings and the technologies deployed.
The Scottish Central Government Energy Efficiency Grant scheme supported over 300 energy efficiency measures and nearly 170 renewables/clean heat measures in public sector buildings between 2021 and 2024. The scheme has not been funding new measures since January 2024 and funding is due to end in 2026.
| 2021 | 2022 | 2023 | 2024 | |
|---|---|---|---|---|
| Energy efficiency/conservation measures | 65 | 234 | 46 | 0 |
| Other renewables/clean heat | 44 | 91 | 34 | 0 |
| Of which, ZDEH/biomass | 11 | 32 | 12 | 0 |
| Of which, solar PV/solar thermal/wind turbine | 33 | 59 | 22 | 0 |
The Scottish Public Sector Energy Efficiency Loan Scheme offers zero-interest loans to local authorities, universities and arms-length external organisations to facilitate spend-to-save energy efficiency improvement projects that result in financial and carbon savings and support public bodies to achieve their net zero targets.
The Scotland Recycling Fund, as part of the loan scheme, is a ring-fenced fund held by the eligible public sector body. It is created with capital provided by Scottish Government through Salix Finance and equally matched by the public sector body. The scheme aims to increase long-term investment in energy efficient technologies across the public sector and the financial savings achieved by projects are reinvested in further eligible projects year on year.
The loan and recycling fund programmes have been the primary funding schemes available to public bodies with borrowing powers in Scotland since 2008, successfully delivering over 1,000 projects. More than £82 million has been invested to date which is forecasted to save the public sector more than £202 million over the lifetime of the projects and save almost 50,000 tCO2e annually.
| 2021-22 | 2022-23 | 2023-24 | 2024-25 | |
|---|---|---|---|---|
| Energy efficiency/conservation measures | 78 | 52 | 71 | 124 |
| Other renewables/clean heat | 11 | 5 | 8 | 6 |
| Of which, clean heating/biomass | 3 | 1 | 5 | 0 |
| Of which, solar/solar thermal/wind turbine | 8 | 4 | 3 | 6 |
Scotland’s Public Sector Heat Decarbonisation Fund launched in October 2023 and is delivered by Salix on behalf of the Scottish Government. The scheme provides grant funding for local authorities, universities and arms-length external organisations to progress whole building approach projects that decarbonise heating systems and improve the overall energy performance of their buildings. The scheme has so far helped to install 55 energy efficiency measures and nearly 20 other renewables/clean heat measures in public sector buildings which are anticipated to save almost 2,400 tCO2e annually.
| 2024-25 | |
|---|---|
| Energy efficiency/conservation measures | 55 |
| Other renewables/clean heat | 18 |
| Of which, ZDEH | 11 |
| Of which, solar PV/solar thermal/wind turbine | 7 |
Note: ZDEH includes heat pumps.
4.1.2. Type: heat network support
4.1.2A Indicator: new pre-capital support projects in previous year
Data source: data collected directly by Scottish Government and delivery partners via the Heat Network Support Unit (HNSU)
Unit: number of projects
Most recent data:
- number of new pre-capital support projects in previous year (2024): 14
| Year | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Number of projects | 11 | 14 | 14 | 6 |
Commentary: See indicator 4.1.2B.
4.1.2B Indicator: new capital support projects in previous year
Data source: data collected directly by Scottish Government and delivery partners via SHNF
Unit: number of projects
Most recent data:
- number of new capital support projects in previous year (2024): 0
| Year | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|---|---|
| Number of projects | 1 | 3 | 2 | 4 | 3 | 0 | 1 |
Commentary (for indicators 4.1.2A and 4.1.2B):
Since 2022, the HNSU has formally supported 45 pre-capital projects in 17 local authority areas through advice, guidance and funding, with the Scottish Government committing approximately £2.5 million of financial support. An additional 6 projects have been supported in 2025 as of August 2025 and any further awards through the HNSU will be reported within the Heat Network Projects Reports. Our heat networks project reports are published quarterly[42] and provide more detail on all supported projects.
The HNSU was established in Autumn 2022 to address key challenges in the pre-capital stages of heat network development and to build capacity across the public sector to deliver successful projects. It is sponsored and managed by the Scottish Government, with partners Scottish Futures Trust and Zero Waste Scotland providing a range of support services. HNSU support includes expert advice, project steering and funding for the pre-capital stages of heat network development, such as detailed feasibility studies, business case building and commercialisation. Support is available for new district heating schemes or extensions to existing district heating schemes.
Launched in 2022, the SHNF makes capital grant funding available to public and private sector organisations to support the roll out of zero emission heat networks across Scotland. To date (as of August 2025), SHNF has awarded approximately £11.8 million to five heat network projects in Scotland.
The LCITP launched in 2015 and closed to new applications in 2022. Since 2019, LCITP has awarded grant funding to nine heat network projects totalling approximately £33.1 million. Figures are provided based on the year in which the heat network project was awarded grant funding through LCITP or SHNF. As the LCITP launched in 2015, there are an additional four heat network projects which were awarded grant funding prior to 2019.
4.1.3. Type: Scottish Government investment
4.1.3A Indicator: Scottish Government funding for the previous year (actual spend) on all schemes that support installation of energy efficiency measures and clean heating systems across domestic and non-domestic properties and the development of heat networks. This will be broken down by scheme and identify both capital and revenue funding.
Data source: Scottish Government delivery schemes
Unit: £
Most recent data:
- Scottish Government funding for financial year 2024-25 (actual spend): net £239.8m in Capital investment as well as net £7.5m of Financial Transactions
| Year | 2023/24 | 2024/25 |
|---|---|---|
| SHNF and LCITP legacy funding capital | 16,000 | 2,600 |
| SHNZHF capital | 29,500 | 19,000 |
| ABS | 58,300 | 59,700 |
| WHS | 59,700 | 90,400 |
| HES Grant and Loan[43] | 62,300 | 39,900 |
| SME Grant and Loan | 8,500 | 6,300 |
| Public Sector Decarbonisation | 27,700 | 29,100 |
| Departure from ERDF schemes[44] | 9,000 | 0 |
| Income from Closed Schemes and additional income from Financial Transactions not recycled | (54,300) | (3,700) |
| Delivery Scheme Resource Spend | 20,500 | 19,400 |
| Other Resource spend | 7,900 | 12,700 |
| Total (Resource)[43] | 28,400 | 32,500 |
| Total (Capital)[44] | 195,200 | 239,800 |
| Total (Financial Transactions) | 18,000 | 7,500 |
| Total Investment | 241,600 | 279,700 |
Note: *values in table above are rounded to the nearest £100,000 and as such totals may not be exact.
Commentary:
These figures represent the actual expenditure incurred by Scottish Government in the previous financial year as published. For this indicator, the baseline data will be financial year 2023-2024. Data for previous financial years are not shown because they are not directly comparable. Spend on HNSU resource is not shown due to data collection restrictions.
We invested over £239 million in capital and loan funding through 2024-25 and almost £20 million of resource for funding advice services. The balance of the resource funding was allocated to Heat in Buildings policy and regulation.
Through this investment, nearly 10,000 households living in or at risk of fuel poverty were supported to make their homes warmer through the WHS programme and ABS. This included investment in renewables and clean heating to help deliver a just transition and healthier homes.
Over 6,500 homeowners applied for funding through the HES Grant and Loans scheme to undertake energy efficiency works and/or install clean heating systems, resulting in 6,100 funding offers.
Over 6,000 domestic clean heat installations funded this year through our schemes and around 330 homes were connected to heat networks using clean heat sources in 2024-25.
4.1.4. Type: advice services
4.1.4A Indicator: number of unique households supported by HES advice service
Data source: Scottish Government scheme data
Unit: number of unique households
Most recent data:
| Year | 2019-20 | 2020-21 | 2021-22 | 2022-23 | 2023-24 | 2024-25 |
|---|---|---|---|---|---|---|
| Number supported | 92,681 | 90,468 | 114,392 | 138,347 | 128,791 | 95,781 |
Commentary: see p 45 for commentary on indicator 4.1.1 A to C.
4.1.4B Indicator: number of SMEs provided in-depth support by Business Energy Scotland (BES) advice service and number of energy assessment reports completed by BES
Data source: Scottish Government advice service
Unit: number of SMEs/number of energy assessment reports
Most recent data: 2024-25
| Year | 2020-21 | 2021-22 | 2022-23[45] | 2023-24 | 2024-25 |
|---|---|---|---|---|---|
| Number of SMEs provided in-depth support | 782 | No data[46] | 1,055 | 1,786 | 1,501 |
| Number energy assessments completed | 988 | 1,144 | 849 | 1,384 | 1,145 |
Commentary: see p 45 for commentary on indicator 4.1.1 A to C.
4.1.4C Indicator: advice and referral services investment
Data source: Scottish Government scheme data
Unit: £
Most recent data: 2024-25
| Year | 2019-20 | 2020-21 | 2021-22 | 2022-23 | 2023-24 | 2024-25 |
|---|---|---|---|---|---|---|
| HES | 8,329,000 | 8,134,000 | 9,379,000 | 12,316,000 | 13,548,000 | 12,678,000 |
| BES | No data | No data | No data | 2,150,000 | 3,070,000 | 2,980,000 |
Commentary (for indicators 4.1.4A, 4.1.4B, 4.1.4C):
HES supported just under 100,000 households in 2024–25 this is less than the number supported in 2023–24. HES capacity was increased to support households through the height of the cost of living and energy crises. Since then, demand for the service has reduced although it still remains high.
From the launch of the new scheme in October 2023, around 21,000 households have been referred through to our WHS fuel poverty support programme which provides funding to eligible households to help make their homes warmer and easier to heat.
In 2024-25 BES provided in-depth support to over 1,500 Scottish SMEs and light-touch support to more than 23,000 on implementing energy efficiency and heat decarbonisation measures. The advice service also produced more than 1,140 bespoke energy assessments which highlight actions a Scottish SME can take to make energy, carbon and cost savings.
Data for investment in BES advice service starts from 2022 since we do not have reliable data for the previous Energy Efficiency Business Support Service scheme.
4.2. Activities: other policy and delivery work
4.2.1 Indicator: qualitative update on developments over the last year
Data source: Scottish Government officials
Unit: N/A
Most recent update/commentary:
This document is both a report against the Monitoring and Evaluation Framework, and our annual report on progress against the Heat in Buildings Strategy. This section therefore provides a qualitative update on progress against key policy and regulatory areas. The key areas identified in the Framework are:
A. Introducing a regulatory framework to scale up the deployment of clean heating systems and energy efficiency measures:
- Regulating for clean heat and energy efficiency improvements in existing buildings.
- Reviewing our social housing standards to align with our net zero targets.
- Reforming EPCs to support the transition to net zero.
B. Working with UK Government and local government:
- Engaging closely with local authorities on their LHEES.
- Working with the UK Government on key heat in buildings policies.
C. Providing support for skills and the supply chain to enable the growth needed in the green heat sector to meet our climate targets.
D. Developing our approach to increasing public awareness and engagement with the heat transition.
E. Exploring solutions to deliver the significant increase in private finance needed for the heat transition, alongside the Scottish Government’s delivery and advice schemes.
F. Developing a regulatory regime for heat networks to meet the statutory requirements of the Heat Networks (Scotland) Act 2021.
4.2.1A Regulatory framework:
New Build Heat Standard (NBHS):
The NBHS remains one of the most important steps we have taken towards decarbonising our buildings and reaching net zero in buildings.
The NBHS means that no new buildings constructed under a building warrant applied for from 1 April 2024 will be built with polluting heating systems, like gas and oil boilers. New domestic and non-domestic buildings will be built with clean alternatives, such as heat pumps and heat networks.
A review of the NBHS took place between May – October 2024, in response to significant concerns raised regarding the reliance on wood burning stoves and wider bioenergy systems, particularly in rural and island communities.
As part of the review, we gathered a wide range of views, including those of rural and island communities. Wood burning stoves, bioenergy, and peat heating systems are now permitted in new buildings. The amendment to the regulations came into force on 1 January 2025.
Regulating for clean heat and energy efficiency improvements in existing buildings:
We are setting a target to decarbonise buildings by 2045, where reasonable and practicable to do so. This will send a strong signal to homeowners, landlords and other building owners on the need to prepare for change.
Regulations will also be progressed under existing powers to introduce a minimum energy efficiency standard in the PRS. These regulations would mean all privately rented properties, as far as possible, reaching the equivalent of EPC C (under our new, reformed EPC). 44% of those living in the PRS in Scotland are in fuel poverty, and therefore we are prioritising this sector for improvement.
We undertook a public consultation on these proposals over the summer and are currently considering responses to the consultation. We expect to lay regulations in Parliament soon.
Socially rented homes will remain subject to a separate standard (see below).
Reviewing our social housing standards to align with our net zero targets:
We will review and complete work on our Social Housing Net Zero Standard in line with progress on the areas above – taking into account and mirroring the standards and requirements established for other tenures through separate regulations.
Social landlords should continue to invest in energy efficiency measures in the meantime to help reduce running costs, and in clean heating systems where appropriate.
Reforming Energy Performance Certificates (EPCs) to support the transition to net zero:
We need to enhance EPCs so that they continue to be a valuable source of information for home buyers, owners, and tenants. The Scottish Government consulted on proposals in 2023 to reform EPCs, in line with the CCC’s advice[47]. These reforms would address long-standing criticisms from the CCC and others that EPC ratings are not aligned with net zero. We published our response to this consultation in January 2025[48]. This set out that we would lay revised Energy Performance of Buildings Regulations later in 2025 and bring them into force in autumn 2026.
Our planned reforms will mean that domestic EPCs have clearer information about how well-insulated a home is by providing new information on the Heat Retention Rating of the home (a rating based on the annual heat demand (kWh/m2) of the building). They will also highlight clearly whether key insulation measures (such as cavity wall and loft insulation) have been installed.
The reformed domestic EPCs will provide new information about the home’s current heating system through a new Heating System Rating, and will continue to provide information on potential improvements that could be made to make the home more energy efficient and information on alternative cleaner heating systems. They will continue to provide a standardised rating to reflect the cost of running the home (the Energy Cost Rating) and show how potential improvements could reduce this cost.
We will make similar reforms to non-domestic EPCs so that they provide a clearer indication of a building’s performance relative to other buildings of the same type, and information about the building’s direct emissions and energy demand.
We are also reducing the validity period of EPCs from ten to five years to ensure that current and prospective building owners and tenants have more up-to-date and accurate information on the building’s energy performance as it transitions to net zero.
These reforms will ensure current and prospective building owners and tenants have clear and relevant information to help them make choices about improving their building’s fabric and heating systems.
We have also reviewed the operation and governance of the EPC assessor market, to ensure that consumers (home and business owners/ tenants alike) have full confidence in their EPC rating. The revised EPC regulations will bring into force a new operational governance framework to strengthen quality assurance requirements, including introducing a new onsite audit and inspection regime to enhance existing checks to ensure EPCs are accurate and reliable. We are also working with the UK Government and other devolved administrations to review the National Occupational Standards, which set the skills, qualifications and training requirements for EPC assessors who are able to operate across the UK internal market.
We are also developing the new technical infrastructure required to underpin the revised EPC regulations. We are working with the UK Government to develop a new cloud-based EPC Register and calculation methodology to enable EPCs in Scotland to be generated using the UK Government’s new Home Energy Model, which will replace the current Standard Assessment Procedure (SAP) methodology in autumn 2026.
4.2.1B Working with UK Government and local government:
Working with the UK Government on key heat in buildings policies:
We continue to work collaboratively on areas of common ground with the UK Government, such as on EPC reform, as outlined above. However, action by the UK Government in reserved areas remains critical to help ensure that the transition is fair and affordable. The key areas are:
- Action to rebalance gas and electricity prices to incentivise the installation of clean heating systems in a way that alleviates fuel poverty and the cost of living crisis.
- A decision on the future of the gas grid, which will have significant implications for any decisions we may make in the future regarding regulating building owners.
- Stronger alignment of investment from GB schemes with LHEES, for example, Energy Company Obligation (ECO) finance.
Engaging closely with local authorities on their LHEES:
LHEES set out the long-term plan for decarbonising heat in buildings and improving their energy efficiency across an entire local authority area. At the time of publication, 31 of the 32 local authorities have published LHEES.
The published LHEES provide an evidence base for what interventions are needed to decarbonise Scotland’s buildings and tackle poor energy efficiency as a driver of fuel poverty, as well as – importantly – where these buildings are located.
We continue to engage closely with local authorities and are providing support through capacity building training.
4.2.1C Workers and skills:
Providing support for skills and the supply chain to enable the growth needed in the green heat sector to meet our climate targets:
We continue to fund the Green Heat Installer Engagement Programme[49], delivered by Energy Saving Trust, to provide assistance and support for installers in their green heat transition to becoming accredited in the installation of heat pumps and insulation.
During 2025-26 the programme launched the Heat Pump Skills Fund, a new grant to upskill existing heating and plumbing businesses on heat pump installation. The mobile heat pump training centre[50] will be used to deliver this training in rural and island areas of Scotland.
The programme includes the MCS Certification Fund which provides a grant to become MCS certified on heat pumps. The grant will pay 75%, up to a maximum of £1,000, of the certification fees. In 2024-25 it supported 25 businesses to become MCS certified, including 19 covering remote and rural areas. The programme has also continued to support a Heat Pump Installer toolkit which gives advice on how to become MCS certified and an Insulation Installer toolkit which gives advice to installers about achieving PAS 2030 certification and becoming a TrustMark registered business.
4.2.1D Public awareness:
Developing our approach to increasing public awareness and engagement with the heat transition:
In December 2023 we published the Heat transition: Public Engagement Strategic Framework, which outlined our approach to increase awareness and understanding of heat decarbonisation and the support available to help make the transition. The SCS, carried out between October 2024 and January 2025, assessed public awareness and understanding of the heat transition, as well as respondents’ willingness and intention to install a clean heating system in their home. A summary of survey results is provided in section 3.2A. In autumn of 2025, a marketing campaign is due to be launched that will promote the HES advice service. The next round of our climate behaviours campaign Let’s Do Net Zero will look to address this by increasing understanding of the fact that installing clean heating is one of the most impactful climate actions an individual can take. We will also run a HES campaign in Autumn 2025 to promote awareness of the advice and support available through HES.
4.2.1E Finance:
Exploring solutions to deliver the significant increase in private finance needed for the heat transition, alongside the Scottish Government’s delivery and advice schemes:
Our Green Heat Finance Taskforce looked at new ways to finance this work, and to stimulate investment in skills, innovation and the supply chain. It published the Part 1 report in November 2023 and the Part 2 report in April 2025. The Scottish Government is currently considering the recommendations and will formally respond in due course.
The Taskforce’s Part 1 report concluded that the market in green home retrofit products in the UK is currently immature but has significant potential for growth. The Part 2 report focussed on place-based solutions, development of heat networks and financing social housing retrofit.
4.2.1F Heat networks policy and delivery:
Developing a regulatory regime for heat networks to meet the statutory requirements of the Heat Networks (Scotland) Act 2021:
Since the introduction in 2023 of regulations that require public sector non-domestic buildings to assess their heating requirements and suitability to connect to heat networks, over 650 building assessment reports have been produced.
We continue to engage with key stakeholders in the development of the heat networks regulatory system, in particular a licensing mechanism which will put developers on a more equal footing with other utilities, for example by providing them with powers to undertake roadworks.
We continue to engage with the UK Government to try and ensure interoperability between our regulatory regime and the regulations to protect heat consumers it is developing after the passage of the UK Energy Act 2023. We are also working closely with UK Government to deliver a Heat Network Technical Assurance Scheme[51] to ensure heat networks are built and operated in an efficient manner.
The Heat Networks (Scotland) Act sets statutory targets for the amount of heat (and cooling) to be supplied by heat networks, which signal to the developing heat networks sector that there is a long term commitment to its growth and providing greater certainty for investors.
We provide regular updates[52] on our progress towards meeting the targets and show how these have been aided by the Heat Networks (Scotland) Act and other supporting policies.
We are exploring opportunities to use legislation to strengthen the regulatory framework introduced by the Heat Networks (Scotland) Act, and will continue to engage and collaborate with stakeholders once final decisions have been made.
Contact
Email: heatinbuildings@gov.scot