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/

Opportunities and Challenges

Q12. Please provide your views on any challenges and/or opportunities offered by the potential expansion of the pilot.

Twenty-three respondents answered this question and identified various challenges and opportunities presented by the potential expansion of the pilot.


Enhance energy efficiency

Greater energy efficiency of Scotland's buildings was the most prevalent theme in comments about opportunities linked to any expansion of the pilot scheme. Some respondents observed that the scheme provides an opportunity to support homeowners to install energy efficiency measures that they could not otherwise afford, and this would have a positive impact on Scotland's carbon emissions.

"Historic Environment Scotland recognises that investment in the ongoing care, maintenance and upgrading of our existing buildings and places is essential to sustaining the quality of Scotland's historic environment and, also, to meeting our climate change targets. We are therefore in broad support of proposals for the expansion of the Home Efficiency Equity Loan Pilot as a means of financing necessary energy efficiency improvements and other such upgrade works." (Historic Environment Scotland)

"From the information provided on the consultation paper, the council would agree that the scheme would appear to be an effective mechanism of supporting the owner-occupier and private rented sectors to transition to decarbonised heat sources and improve energy efficiency." (South Lanarkshire Council)

Reduce fuel poverty

A few respondents suggested that, as energy efficiency measures can help to reduce energy costs, the scheme could help to address fuel poverty.

"These energy efficiency improvements and associated fabric repairs could have a significant impact on reducing the fuel poverty position of owners throughout Scotland." (Individual)

Economic growth

A small number of respondents expressed a view that the scheme could contribute to economic growth by enhancing demand for energy efficiency measures, and providing an opportunity for contractors in the industry.

"The wider Government targets and other funding mechanisms around energy efficiency and low/no carbon systems again will assist in focussing attention on this area and the business opportunities that will exist going forward. "(Organisation, anonymous)

Quality standards

One respondent noted that the scheme could encourage contractors to obtain new accreditation, thereby helping to improve quality standards in the industry more widely.


Engaging homeowners

Difficulties in engaging homeowners were the challenges most commonly mentioned by respondents to Q12. In this discussion, some predicted difficulties in encouraging potential participants to release equity from their property.

"It is the Council's view that homeowners are reluctant to release equity from their property for a wide range of social and financial reasons therefore promotion of the scheme and impending energy efficiency regulation will need to be a key message from the Scottish Government to prompt owners and private landlords to take action." (Glasgow City Council)

Two respondents noted the importance of providing evidence of the benefits, such as the financial gains associated with energy efficiency measures, to encourage homeowners to take part in the scheme.

"Scottish Government needs to work hard by providing scientific facts to convince owners that they should decarbonise their homes." (Care & Repair Scotland)


The resources required to deliver the scheme was another challenge highlighted by some respondents. A few noted the importance of ensuring that delivery and partner organisations have the necessary human resources to coordinate the scheme to avoid delays in the application process. The high cost of the energy efficiency measures required was another challenge identified by a small number of respondents.

"The Scottish Government's energy efficiency targets for domestic properties are too ambitious unless a significant programme of grant funding is made available to heavily supplement individual homeowners' investments." (Propertymark)

Contractor availability

Some respondents noted that the availability of contractors with the skills to install the required measures could be a challenge, and that support from the Scottish Government might be necessary to build the capacity of contractors. Another issue, cited by one respondent, is that homeowners could be "ripped off" by unscrupulous traders.

"We recommend that any scheme should support the engagement of a sufficiently skilled and knowledgeable workforce to specify, install, and assess any upgrade works. This is so that works are undertaken sensitively and to a high standard." (Historic Environment Scotland)

Types of property

The need to ensure the scheme is appropriate for Scotland's varied housing stock was described by a few respondents. In these comments they expressed particular concern around types of building, including historic and listed properties, where the feasibility of making improvements may be limited by technical and/or financial factors.

"It will be critical, however, that any financing scheme should cover works which are compatible with Scotland's varied historic and traditional building stock. This is necessary so that any adaptations undertaken do not harm either the fabric or cultural significance of our historic buildings." (Historic Environment Scotland)

One highlighted the regional differences in building type across Scotland and commented that a measure appropriate in buildings in one area of the country might not work in another area.

Administrative issues

A few respondents mentioned challenges related to the administration of the scheme for consumers, local authorities, local housing authorities and other parties. They shared examples of issues experienced during the pilot, for example, delays in the application process, and felt that the scheme would be improved if these matters were addressed.

"The bureaucracy of this pilot has caused significant problems to clients, Care and Repair, and participating local authorities and RSLs. The fact that a pilot continued for 5 years is indicative of this. The loan is an exceptional product, which the Scottish Government should be proud of, but unless the backroom administration is radically overhauled, any rollout will fail." (Care & Repair Scotland)


Email: heatinhomesequityloan@gov.scot

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