Local Housing Strategy: guidance 2026

Fuel poverty and climate change

Housing has a vital role to play in meeting the Scottish Government’s ambitions for ending fuel poverty, reducing greenhouse gas emissions and adapting to the effects of climate change in Scotland. Local authorities have a significant part to play in supporting these ambitions and ensuring that people are able to live in warm, dry, energy efficient, low carbon homes which they can afford to heat.

In developing a LHS, local authorities should be fully aware of the existing fuel poverty, energy efficiency and climate change targets and duties and these should be considered in relation to the development of LHS priorities and outcomes.

Fuel Poverty

Improving energy efficiency is a key component to tackling fuel poverty and achieving our net zero ambitions.

The Fuel Poverty (Targets, Definition, and Strategy) (Scotland) Act 2019 introduces a definition of fuel poverty for Scotland and sets a statutory target for reducing fuel poverty that by 2040, as far as reasonably possible, no household in any local authority area in Scotland is in fuel poverty, and in any event:

• no more than 5% of households, in any Local Authority area in Scotland, are in fuel poverty
• no more than 1% of households, in any Local Authority area in Scotland, are in extreme fuel poverty
• the median fuel poverty gap of households in fuel poverty in Scotland is no more than £250 in 2015 prices before adding inflation

In December 2021, the Scottish Government published Tackling fuel poverty in Scotland: a strategic approach which outlines a comprehensive range of actions, including those longer-term, designed to tackle the four drivers of fuel poverty (poor energy efficiency of the home; low household income; high energy prices; how energy is used in the home), help meet the statutory fuel poverty targets and in turn help contribute to improved health and wellbeing for people across Scotland.

Local authorities are encouraged to ensure that LHS priorities and outcomes complement a local authority’s Local Heat and Energy Efficiency Strategy, building upon energy efficiency planning and delivery, and set out by location the scale and nature of fuel poverty in an area. This should include the type and number of households a local authority considers to be the most vulnerable and how action to address the needs of these households is being prioritised.

Local authorities are encouraged to consider the impact that living in a cold home has on the health and wellbeing of individuals. Local authorities should set out the action that is being taken to address the scale of fuel poverty in the area, demonstrate how improvement is being measured, including in respect of health inequalities.

Climate Change

In order to achieve Scotland’s climate change targets, concerted and coordinated action is required across the public and private sectors and at individual and community level. The Climate Change (Emissions Reduction Targets) (Scotland) Act 2019 set an overall target to achieve net zero greenhouse gas emissions by 2045, with interim targets requiring a 75% reduction by 2030, and 90% by 2040.

This was followed last year with the Climate Change (Emissions Reduction Targets) (Scotland) Act 2024, which moved Scotland to a carbon budget approach to setting emissions targets as part of a drive for credible, deliverable climate action across the portfolios of government. A carbon budget sets a limit on the amount of greenhouse gases emitted in Scotland over a five-year period. The 2024 Act retains the overall target of net zero by 2045, and five-year carbon budgets will now be set by secondary legislation after consideration of the latest advice from the Climate Change Committee.

Section 44 of the Climate Change (Scotland) 2009 Act requires relevant public bodies, in exercising their functions, to act in a way that they consider to be most sustainable and:

• best calculated to contribute to the delivery of the Act’s national emission reduction targets
• best calculated to help deliver the statutory climate adaptation plan

Section 45 of the Climate Change (Scotland) 2009 Act requires Scottish Ministers to give guidance to public bodies in relation to the climate change duties; and bodies are required to have regard to such guidance. New draft statutory guidance is currently under consultation. The Scottish Government aim to publish the final guidance by the end of 2025.

Section 46 of the Climate Change (Scotland) 2009 Act makes provision to require public bodies to publish annual climate change reports. The 180 plus public bodies deemed to be ‘major players’, including local authorities, have a statutory duty under The Climate Change (Duties of Public Bodies: Reporting Requirements) (Scotland) Order 2015, as amended, to report annually on compliance with the climate change duties. The Reporting Order lays out in detail the content and format of the annual reports. It is expected that a second Amendment Order will be taken through Parliament in 2026, to strengthen aspects of existing questions and to add a number of new ones.

Climate Change Adaption

Climate change means that Scotland will be wetter in winters, drier in summers, sea level rise will continue, and our weather will become more variable and unpredictable. These changes lead to climate-related risk to housing (and places and settlements more generally). These risks include increased flooding, intense rainfall, coastal change, and the increased risk of overheating in hot weather.

The Scottish National Adaptation Plan 2024 to 2029 sets out national adaptation priorities with a focus on place, collaboration and inclusive action. Priorities and outcomes identified by local authorities in a LHS should help support the delivery of the plan by supporting its relevant objectives. Relevant objectives are likely to include:

objective c4: New buildings are designed for a future climate, and opportunities for adaptation in existing buildings are taken during maintenance or retrofit.

objective nc1: Nature-based solutions (NBS) are protected, enhanced and connected to enable healthier, cooler, water resilient and nature-rich places. (Examples of NBS including street trees, parks, raingardens, green roofs, improved walking, wheeling and cycling and water ways.)

objective nc3: Development planning (including LDPs and associated delivery programmes) takes current and future climate risks into account and is a key lever in enabling places to adapt.

objective nc4: Nature Networks across every local authority area are improving ecological connectivity and climate resilience, alongside other transformative national actions to halt biodiversity loss by 2030.

objective c6: Coastal communities are preparing for and adapting to coastal erosion and sea level rise.

objective ps3: Partnerships for water resource planning and rainwater drainage networks are active in prioritised catchments to support drought resilience, flood resilience and climate resilient places.

Heat in Buildings

Scotland’s Heat in Building Strategy sets out a pathway to zero emissions buildings by 2045. It details a series of near-term actions to put us on a clear path towards this, as well as a range of further, longer-term commitments to accelerate the transformation of the nation’s building stock. Local authorities should be aware that the Scottish Government will publish an updated strategy and delivery plan in 2025, to reflect changes since the strategy was published in 2021.

Local authorities have a duty to publish a Local Heat and Energy Efficiency Strategy, which provide a strategic plan for local authorities that will support the scaling up of action to improve energy efficiency, decarbonise heat and tackle fuel poverty. They should inform local development planning to ensure a single coherent approach to heat planning across Scotland.

A Local Heat and Energy Efficiency Strategy identifies strategic heat decarbonisation zones and set out principal measures for reducing building emissions within each zone. It prioritises areas for delivery of heat decarbonisation action and provide a strategic plan which can be used to target government funding and private investment for heat decarbonisation and energy efficiency investment.

Summary of areas expected to be included in LHS

a. a description of fuel poverty locally, in line with the 2019 Fuel Poverty Act including information on:

• extent, location and nature of fuel poverty fully demonstrated (with any available data/statistics for example the Scottish House Condition Survey)
• causes of local fuel poverty explained, how these might differ from national trends and the action being taken to address the identified causes
• knowledge of vulnerable groups in fuel poverty and how action to address the need of these households is prioritised
• how improvement is being measured

b. a summary of the work that is being done locally to ensure, that across all tenures, “so far as reasonably practicable, persons do not live in fuel poverty” with consideration of the four drivers of fuel poverty.

c. a summary of any programmes or actions related to housing arising from a local authority’s Local Heat and Energy Efficiency Strategy including an explanation around how these have influenced the development of climate change, heat decarbonisation, energy efficiency, and/or fuel poverty policies.

d. a summary of the technology options identified by the local authority’s Local Heat and Energy Efficiency Strategy for the decarbonisation of heat in different areas of the local authority.

e. with consideration of a local authority’s Local Heat and Energy Efficiency Delivery Plan a summary setting out how available resources are being used effectively to tackle fuel poverty and accelerate the rate of energy efficiency improvements and uptake of low/zero carbon heat across all tenures, including increasing the number of householders and property owners that benefit from support from fuel poverty and energy efficiency/decarbonisation programmes.

f. a short summary of how LHS priorities and outcomes will support relevant objectives of the Scottish National Adaptation Plan.

g. a summary of robust fuel poverty and greenhouse gas emissions outcomes with local targets and indicators to measure progress in support of the Scottish Government fuel poverty and climate change targets, including through local delivery of the Scottish Government’s Area Based Schemes.