Home Energy Efficiency Equity Loan pilot - call for evidence on potential national rollout: analysis of responses

Independent analysis of the responses to the call for evidence on the potential to develop an Equity Loan Scheme as part of the suite of support schemes for the decarbonisation of Scottish homes. Read the call for evidence: https://www.gov.scot/publications/equity-loan-scheme-call-evidence/pages/1/

Executive Summary

Most respondents endorsed the use of home equity to support decarbonisation and energy efficiency and described the benefits of this approach for individual homeowners and for Scotland more broadly. However, some raised concerns about equity release models, including how to support applicants and whether the pilot has sufficient reach.

While some respondents agreed with the current eligibility and scope of the pilot, others felt that council tax banding should not be used to determine eligibility. Within comments there was some discussion about expanding the eligibility criteria in future to include as many households as possible.

Most respondents were positive about the scheme's potential contribution to meeting the Scottish Government's climate change and fuel poverty targets. A few offered suggestions for how the scheme's impact could be maximised. A small number did not think the scheme would affect climate change and fuel poverty targets.

Nearly all respondents supported a nationwide rollout of the scheme. Some suggested changes to the scheme if it were to be rolled out on a larger scale, included streamlining the application process and supporting applicants to make the best use of funds and the right decisions for their home.

There was broad agreement that the EPC could be used in a future scheme, but some respondents noted concerns or reservations such as limitations in the approach or concerns over the quality of the EPC, with a few suggesting ways to improve the oversight of the EPC system.

The need to appoint an organisation to help promote consumer protection was noted. Important aspects of consumer protection, including advice and support, contractor standards and inspections, were highlighted. It was suggested that a consumer protection organisation could drive quality standards among contractors; a small number saw a role for consumer protection in the work inspection process. A few respondents called for warranties for any work carried out and the goods installed.

Respondents suggested a range of ways to support partnership working with housing associations and local authorities, including faster and simpler application processes, direct payments to partners, alignment with other schemes.

The importance of support and advice to help homeowners navigate the complexities of the scheme was a prevalent theme in responses. Various forms of support were noted; such as independent legal advice, general guidance about the terms of the loan and information about what to expect in the application process and beyond.

Respondents identified various challenges and opportunities presented by the potential expansion of the pilot. Greater energy efficiency of Scotland's buildings was the most prevalent theme in comments about opportunities linked to any expansion of the pilot scheme. A few respondents suggested that, as energy efficiency measures can help to reduce energy costs, the scheme could help to address fuel poverty. A small number of respondents expressed a view that the scheme could contribute to economic growth.


Email: heatinhomesequityloan@gov.scot

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