Publication - Progress report

Heat Network Projects Progress Report - October 2026

Published: 2 November 2026
Directorate: Energy and Climate Change Directorate
Topic: Energy, Environment and climate change
ISBN: 9781807756727

Information on the capital and pre-capital projects which have been funded through Scotland's Heat Network Fund, Low Carbon Infrastructure Transition Programme, Social Housing Net Zero Heat Fund and the Heat Network Support Unit.

Supporting documents

Heat Network Support Unit’s Strategic Heat Network Support

The HNSU introduced strategic heat network support to build on existing LHEES work and support local authorities in developing a strategic approach to deploying large-scale district heating in their respective areas. See the HNSU’s guidance page for more information.

To help local authorities plan and navigate the complexities of strategic heat network deployment, a draft route map has been introduced by Scottish Futures Trust. The complete route map is available on the Scottish Futures Trust website and is summarised below:

Stage	Key Activities
1. Set up / Scoping	Establish programme Agree scope Appoint advisors
2. Analysis	Technical studies Delivery models analysis Options appraisals
3. SOC	Develop procurement strategy Develop SOC Preferred delivery model
4. OBC / Commercialisation	Develop OBC Procurement Develop Final Business Case

Project Support

During the initial phase of strategic heat network support across FY 2023/24 and FY 2024/25, the HNSU supported seven local authorities. For most local authorities, this involved high-level technical analysis and delivery models assessments to better understand the opportunities and routes to market for potential heat networks identified in their respective LHEES.

Six local authorities undertook phase two of strategic heat network support, progressing their strategic projects through detailed technical work, financial modelling and in-depth stakeholder engagement.

Most local authorities are now considering a Strategic Outline Case (SOC) or Outline Business Case (OBC) as the next step. While some local authorities are progressing next steps internally, the HNSU is currently supporting four strategic projects across five local authority areas. These projects are now moving several heat network opportunities from early-stage concepts towards investable projects, and generating learning on rural heat networks and routes to market that can benefit future Scottish heat network development.

Project Overviews

An overview of each strategic heat network support project, including the support they have received from the HNSU, can be found below.

Table 1: HNSU Strategic Heat Network Support Projects Overview
Area	FY 23/24 & 24/25	FY 25/26	FY 26/27	Total	Project summary
Scottish Borders Council, Dumfries & Galloway Council, and South of Scotland Enterprise (SOSE)	-	Advisory	Up to £68,000 (up to 90% of project eligible costs)	Up to £68,000	The councils partnered with SOSE to publish a South of Scotland Heat Network Prospectus in 2025. The organisations then carried out work to understand the delivery model(s) required to support small, clustered heat network development opportunities, and are now developing a route-map and supporting tools which will enable them and others to bring forward rural heat network projects.
The City of Edinburgh Council	£93,577 (up to 90% of project eligible costs)	£100,000 (up to 90% of project eligible costs)	-	£193,577	The council reviewed 17 prospective heat network zones, developed supporting delivery documentation, completed a feasibility study for the Northeast Edinburgh Heat Network Zone, and analysed transmission routes from primary heat sources.
Perth & Kinross Council	£100,000 (up to 90% of project eligible costs)	Advisory	-	£100,000	The council have developed the strategic, technical and commercial foundations for heat network delivery in the region. They also developed a wider pipeline of low-carbon and renewable energy projects to inform future investment priorities. These activities have helped shape a Strategic Outline Case exploring the establishment of a Strategic Energy Partnership as a long-term delivery and investment vehicle for heat networks and other strategic energy infrastructure projects across Perth and Kinross.
Fife Council	£104,939 (up to 90% of project eligible costs)	£52,117 (up to 90% of project eligible costs)	Up to £45,000 (up to 50% of project eligible costs)	Up to £202,056	The council carried out a heat network delivery models options appraisal and developed a Dunfermline & Rosyth Energy Plan with a heat network being the anchor project. They also undertook a feasibility study for a heat network in Kirkcaldy which would connect schools, leisure and retail facilities, and Victoria hospital using water source heat pumps utilising recoverable heat from the final treated effluent at the Kirkcaldy Wastewater Treatment Site. The council are now developing an OBC for a delivery vehicle.
Glasgow City Council	£145,904 (up to 90% of project eligible costs)	-	-	£145,904	The council deepened their understanding of the supply opportunities across the city and developed a Multi-Criteria Analysis tool to aid decision making. More recently, the HNSU has acted as a critical friend for the development of an OBC.
The Highland Council	£85,910 (up to 90% of project eligible costs)	£118,113 (up to 90% of project eligible costs)	-	£204,023	The council undertook a feasibility study for a new heat network serving the West Bank area of Inverness. This included integrating local renewable energy generation and the potential for future expansion across the city. They also carried out a wider scan of potential heat network opportunities across the local authority area, identifying next steps for key areas. The council are now progressing the West Bank opportunity to OBC development.
Dundee City Council	£126,087 (up to 90% of project eligible costs)	£34,411 (up to 90% of project eligible costs)	-	£160,498	Building on the city-centre feasibility study and city-wide heat network opportunity analysis completed in phase one, the second phase focused on a detailed heat source assessment, updated financial modelling, and progressing stakeholder engagement. Recommended next steps are progressing to SOC and OBC.
Inverclyde Council	£99,356 (up to 90% of project eligible costs)	£49,500 (up to 90% of project eligible costs)	Advisory	£148,856	The council undertook an area wide scan which showed that the areas of highest heat network potential are Greenock Waterfront, Ravenscraig and Port Glasgow. These areas were selected for further study as part of phase two which included feasibility studies for all three areas. The council are now receiving advisory support to determine which schemes and what delivery model should go forward to OBC stage.

Scotland’s Low Carbon Infrastructure Transition Programme and Heat Network Fund Capital Projects

Table 2: LCITP and SHNF Projects Overview
Project and Location	Project Description	Technology Type (s)	Date Commissioned	Type of Support
Renfrewshire Council – AMIDS District Heat Network	Installation of a new low-carbon heat network at the Advanced Manufacturing Innovation District Scotland (AMIDS), providing renewable heat to innovation and manufacturing facilities, including the National Manufacturing Institute Scotland and Medicines Manufacturing Innovation Centre.	5th Generation heat network using sewer source heat.	March 2023	£3,136,968 LCITP grant (44.2% of project eligible costs)^[1]
Aberdeen City Council - Torry Heat Network, Phase 1	Utilising heat from a Heat Distribution Facility at Tullos Recycling Centre and a heat offtake at the new Energy from Waste plant at Tullos, the project links to the existing HeatNet district heat network to provide additional connections to domestic, local authority, and third sector customers.	New heat network using Energy from Waste (EfW).	December 2023	£5,787,235 LCITP grant (50% of project eligible costs)
LAR Housing Trust - Zero Carbon Affordable Homes	Installation of a shared ground loop array heating system with ground source heat pumps and high efficiency heat batteries to serve 14 properties (10 affordable flats and 4 houses) in Fountainbridge, Edinburgh.	Shared ground array with heat pumps and thermal storage.	April 2024	£128,283 LCITP grant (50% of project eligible costs)
Abbey Ecosse	Installation of an integrated low carbon energy network comprising of an anaerobic digestion (AD) plant that provides heat and power to the site, a biogas gas engine, a peak demand biogas boiler, electrical storage, and grid export. The Old Poultney Distillery will provide by-products to the AD plant for the generation of biogas.	Energy system comprising an anaerobic digestion plant, biogas engine, peak demand biogas boiler, EV chargers, electrical storage and grid export.	Summer 2024	£1,111,975 LCITP grant (50% of project eligible costs)
Aberdeen City Council Housing Project - Kaimhill	Installation of a new zero direct emissions heat network providing affordable heat to 35 new council social housing homes at the Kaimhill development site in Garthdee, Aberdeen.	Installation of a shared ground array with heat pumps.	August 2024	£306,525 SHNF grant (50% of project eligible costs)
Glen Mhor Ltd Heat Project, Inverness	Installation of a new energy centre housing a water source heat pump which uses the River Ness to supply heat to the Glen Mhor Hotel in Inverness.	Energy centre with 1MW water source heat pump.	September 2024	£1,646,642 LCITP grant (50% of project eligible costs)
Midlothian Council - Millerhill Low Carbon District Heating Project, Shawfair	Installation of a low-carbon district heating network in Shawfair, utilising heat recovered from the Millerhill Energy from Waste plant to supply the initial development plots. This was delivered by a joint venture Energy Services Company (ESCO), comprising of Midlothian Council, Vattenfall Heat UK and Midlothian Energy Limited.	Construction of energy centre and heat network using heat from the Millerhill Energy from Waste Plant.	Autumn 2024	£7,407,000 LCITP grant (50% of project eligible costs)
The City of Edinburgh Council - Granton Waterfront Western Villages	Installation of a low-carbon heat network serving 444 new-build properties at the Granton Waterfront Western Villages development through the use of nine air source heat pumps, seven water to water heat pumps and a pipe network to each apartment block. Each property was fitted with solar PV, enhanced utilities and improvements.	District heating system using air and water source heat pumps; solar PV, energy efficiency improvements and enhanced utilities with smart controls for metering and billing.	March 2025	£4,102,801 LCITP grant (50% of project eligible costs)
North Lanarkshire Council - Brandon Street, Motherwell	Installation of a zero direct emissions communal heating system supplying 48 social rented flats in Motherwell.	Shared ground array with ground source heat pumps.	March 2025	£415,432 SHNF grant (50% of project eligible costs)
Lowther Homes Ltd - Ashgill Road Low Carbon Heat Project	Installation of a shared group loop array at Ashgill Road, Milton, Glasgow, serving a 48-unit new build affordable housing development.	Shared ground array with ground source heat pumps.	April 2025	£388,074 SHNF grant (50% of project eligible costs)
Aberdeen City Council – Torry Heat Network – Phase 2	Expansion of the Torry Heat Network, connecting a community hub and enabling affordable low carbon heat for a further 587 homes, building on the Phase 1 network supplied by the Tullos Energy from Waste plant and Heat Distribution Facility.	Expansion using recoverable heat from Energy from Waste Plant	March 2026	£8,971,492 SHNF grant (50% of project eligible costs)
Renfrewshire Council – Gallowhill and Glencairn	Installation of a new zero direct emissions heat network, providing affordable heat to 180 social housing flats at Gallowhill Court and Glencairn Court in Paisley, replacing existing gas boilers.	Shared ground array with heat pumps.	Due December 2026	£1,798,382 SHNF grant (50% of project eligible costs)
Aberdeen City Council – Hazlehead Heat Network Project	Installation of a new low-carbon heat network at Hazlehead Academy, supplying a range of public and residential buildings, including 228 homes in the Hazlehead area of Aberdeen.	Construction of an energy centre utilising recovered heat from Aberdeen Crematorium and air source heat pumps	Due January 2027	£2,210,166 SHNF grant (46% of project eligible costs)

Social Housing Net Zero Heat Fund Capital Projects

Table 3: SHNZHF Capital Projects Overview
Project and Location	Project Description	Technology Type (s)	Date Commissioned	Type of Support
NG Homes - Carron Estate ASHP Heat Network Project, Springburn, Glasgow	The project involved seven tower blocks of 314 dwellings which had a mixture of ‘old’ inefficient electric storage and electric wet systems, which were expensive to run. ASHPs were connected to a district heating network, along with solar PV onto three of seven blocks.	Air Source Heat Pump; Solar PV	July 2022	£3,695,187 SHNZHF Grant (up to 50% for eligible project costs)
Grampian Housing Association - MacKenzie Gardens Zero Emissions Heating Project (Turriff, Aberdeen)	Installation of a communal air source heat pump system to supply 23 social housing homes in Aberdeenshire. Solar panels were installed so solar energy can be stored (in battery storage) and used to reduce energy costs for tenants, with any excess energy been fed back into the grid or provisioned for use in other Grampian Housing Association housing stock nearby. The system was designed for potential future expansion.	Communal ASHP system with solar PV, battery storage and additional insulation measures	August 2022	£306,534 SHNZHF Grant (up to 50% for eligible project costs)
West of Scotland Housing Association - Arlington Street, Glasgow	Arlington Street is a sheltered housing complex for elderly people consisting of 25 flats. It was previously heated by a communal gas-fired boiler plant. The communal ASHP has reduced the carbon footprint of the building and offers reduction in energy bills for tenants with the support of fabric improvements, including thermal glazed windows.	Communal ASHP system with individual Heat Interface Units in each flat; electric boiler backup	May 2024	£310,000 SHNZHF Grant (up to 60% for eligible clean heat costs and 50% for eligible energy efficiency costs)
East Ayrshire Council - Meagher Court Whole House Retrofit	This project focuses on the decarbonisation of 12 flats, currently void, in Cumnock, East Ayrshire. The project will replace existing gas central heating with a communal ground source heat pump system and additional energy efficiency works including insulation measures, solar PV, battery storage and mechanical ventilation with heat recovery.	Communal GSHP system, solar PV, battery storage alongside other energy efficiency measures including insulation	Estimated January 2027	£420,000 SHNZHF Grant (up to 60% for eligible clean heat costs and 50% for eligible energy efficiency costs)

Contact

Email: HeatNetworkFund@gov.scot

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