Scotland's draft Climate Change Plan: 2026-2040: strategic environmental assessment - environmental report

4. Assessment findings and mitigation

4.1. Buildings (Residential and Public)

Introduction

4.1.1 A transformational change to the way in which we heat our residential and public buildings is essential to meet Scotland’s net zero target – transitioning to clean heating by 2045 and reducing the energy required for heating.

4.1.2 Emissions from buildings, primarily from heating, currently accounts for 15% of Scotland’s greenhouse gas emissions^[154] - having reduced by 39% since 1990 to 6.0 MtCO2e in 2023 (published in 2025). In order meet our carbon budgets, emissions for this sector must be reduced to 28.7 MtCO2e for 2026-2030, 26.4 MtCO2e for 2031- 2035 and 16.7 MtCO2e for 2036-2040.

4.1.3 The heat transition will require around 1.9 million homes and 13,000 public buildings to move to clean heating systems such as heat pumps and heat networks by 2045. Scotland must rapidly accelerate the number of heating systems converting to clean heat as we move towards and then into the next decade. Almost 20% of Scotland’s building stock was constructed before 1919, so special consideration will be given to retrofitting traditional buildings.

Relevant key pressures and trends

• Scotland’s homes are a major source of emissions with buildings (dominated by direct fuel combustion for home heating) accounting for 19% of total emissions in 2023^[155].
• The CCC in Scotland’s Carbon Budgets (2025) have suggested that by 2040, among today’s highest-emitting sectors, surface transport, fuel supply, and non-residential buildings should make the greatest percentage decrease in emissions compared to 2022^[156].
• There is an increasing need to retrofit historic buildings for energy efficiency and climate resilience, which presents both opportunities and risks to fabric integrity and heritage value.

Outcomes

4.1.4 The following outcomes for the Buildings (Residential and Public) sector are set out in the draft CCP:

• The heat supply to our homes and non-domestic buildings is substantially decarbonised, with high penetration rates of renewable and zero emissions heating.
• Our homes and buildings are highly energy efficient, with all buildings upgraded where it is appropriate to do so, and new buildings achieving ultra-high levels of fabric efficiency.
• The heat transition is fair, leaving no-one behind and stimulates employment opportunities as part of the green recovery.

Assessment findings

4.1.5 Where policies and proposals were previously assessed in the SEA for the CCPu (2020), findings identified the potential for positive effects on climatic factors, air quality, population and human health and material assets. However, potential negative effects were identified as having the potential to arise from the siting, installation and operation of different technologies such as district heat networks, heat pumps/ground source heat pumps, biomass and solar panels on soil, air quality, water quality and biodiversity. It was considered that many of the impacts may be localised, and these activities will be subject to existing mechanisms such as planning and consenting conditions prior to work being undertaken. Negative effects were identified in relation to landscape and the historic environment, particularly in relation to cumulative developments or changes to historic buildings from for example solar panels. Taking into account the updated baseline, we consider these findings to remain valid.

4.1.6 Proposed policies aiming to improve energy efficiency in buildings—through minimum standards, retrofitting, and enhanced EPC regulations—are expected to deliver environmental benefits. These include reduced greenhouse gas emissions due to lower heating demand and improved insulation, as well as better air quality from decreased reliance on fossil fuels. Energy-efficient homes also contribute positively to human health by retaining heat and reducing fuel poverty, particularly in social housing.

4.1.7 However, the implementation of these measures may pose challenges for the historic and natural environment. Retrofitting older buildings can lead to visual and structural changes, especially if insulation is poorly installed or highly visible. The cumulative impact of renewable technologies like solar panels and heat pumps may alter landscapes and affect the appearance of cultural heritage assets. Additionally, the use of plastic-based insulation materials such as expanded polystyrene or polyisocyanurate, which have a high carbon footprint during production, could offset some of the environmental gains.

4.1.8 Technologies such as heat networks, biomass systems, and solar installations may also have localised environmental impacts, including potential effects on soil, water, and biodiversity. Nevertheless, these risks are expected to be localised and mitigated through existing planning regimes.

Key findings

• Overall positive effects are anticipated for climatic factors, air quality, and population and human health.
• Potential localised negative effects were identified for biodiversity, soil and water.
• The cumulative impact of renewable technologies like solar panels and heat pumps may alter landscapes and affect the appearance of cultural heritage assets.

Mitigation and enhancement

4.1.9 Potential negative effects have been identified related to an anticipated uptake in the production and use of synthetic insulation materials which are prevalent among the construction and retrofit industries. Production of these materials creates high levels of CO2 emissions and their use in retrofit may result in high levels of non-recyclable waste. A technology-neutral approach to decarbonising Scotland’s buildings could allow for the further development and use of sustainable insulation materials instead of synthetics.

4.2. Transport

Introduction

4.2.1 The transport system is a fundamental part of how people live. It influences the way we live, work and learn. It allows us to access goods and services, and the efficient movement of people and goods is crucial for the economy. The current transport system drives inequalities and is centred around fossil fuel powered modes of transport. For this reason, transport is Scotland’s largest emitting sector, accounting for a third (33.2%) of Scottish emissions in 2023^[157].

4.2.2 To achieve net zero by 2045, there needs to be a transformation in how people travel in Scotland. There will need to be a major shift in the vehicles and fuels used, in transport and energy infrastructure, travel choices, and in the transport skills that people learn and deploy. Transport and travel are so much a part of everyday life that everyone will be affected by the transition that has to take place. There needs to be a move away from the types of transport that contribute most to greenhouse gas emissions, to types that are less carbon intensive. Where possible, especially where public transport alternatives are available, this includes moving away from traditional private car use – the largest contributor to transport emissions.

Relevant key pressures and trends

• As of 2025, there are 19 active Air Quality Management Areas (AQMAs) in Scotland, with a further 9 in the process of being revoked. Of the current AQMAs, most are transport-related, with a small number declared for industrial emissions.
• The main sources of emissions in 2023 were Domestic transport, Buildings and product use and Agriculture. In 2023, cars accounted for 38.9% of total transport (including international aviation and shipping) emissions.
• In 2023, domestic transport was the largest source of net emissions^[158].

Outcomes

4.2.3 There are six outcomes for the Transport sector set out in the draft CCP. A full list of the individual policies and proposals which feed into these outcomes can be found in Appendix A. The outcomes are:

• To address our overreliance on cars, we will create the enabling environment for reducing car use, incentivising behaviour change towards sustainable travel modes and disincentivising private car use, where these align with a just transition.
• To support modal shift through more sustainable forms of travel, including incentivising public transport use and supporting more people to walk, wheel and cycle for everyday journeys.
• To support modal shift through encouraging more freight to move by rail or water instead of road.
• We will phase out the need for new petrol and diesel cars and vans by 2030.
• We will work with the energy, finance and road transport sectors and related businesses to ensure all road vehicles are zero emission by 2040.
• We will work to decarbonise scheduled flights within Scotland by 2040.

Assessment findings

4.2.4 Where policies and proposals were previously assessed in the SEA for the CCPu (2020), findings generally identified the potential for climatic factors, air quality, population and human health. Findings identified mixed effects on material assets as increased use of electric vehicles has the potential to increase electricity demand and pressure on existing electricity generation networks if upgrades are not made to facilitate transition towards decarbonisation. Taking into account the updated baseline, we consider these findings to remain valid.

4.2.5 New policies and proposals outlined are expected to have positive impacts on climatic factors. Reducing car use, shifting freight from road to rail and water, and encouraging public transport all contribute to lowering greenhouse gas emissions. The rollout of electric vehicle (EV) infrastructure and transition to zero-emission vehicles further supports decarbonisation. Additionally, the development of sustainable aviation fuel (SAF) is anticipated to reduce emissions in the aviation sectors.

4.2.6 Many of the proposed measures are likely to improve air quality, which in turn benefits population and human health. Fewer petrol and diesel vehicles on the road mean less particulate matter and nitrogen dioxide in the air. Modal shifts to buses and rail, along with increased EV adoption, are expected to reduce pollution in urban areas. SAF may also reduce particulate emissions around airports. These improvements in air quality are linked to better respiratory health and overall wellbeing for communities.

4.2.7 While most impacts are positive, some mixed effects are noted. For example, the expansion of EV infrastructure may place additional pressure on the electricity grid, requiring upgrades. The production of SAF could have negative implications for biodiversity and landscape depending on biomass sourcing and harvesting practices. However, reduced noise and congestion from freight modal shift and cleaner transport options may have positive effects for population and human health.

Key findings

• Overall positive effects are anticipated for climatic factors, air quality, and population and human health.
• Mixed effects are anticipated for material assets as greater pressure may be put on the electricity grid, requiring upgrades to be made to facilitate this transition.
• There is the potential for negative impacts on biodiversity and landscape depending on the source of biomass required to produce SAF and the harvesting practices utilised.

Mitigation and enhancement

4.2.8 No mitigation or enhancement measures have been identified.

4.3. Waste

Introduction

4.3.1 Over the past two decades Scotland has made strong progress in reducing emissions within the waste management sector. In 2023, the waste management sector emissions stood at 1.7 MtCO2e, 73% lower than the 6.3 MtCO2e in 1990. Progress has been driven by cutting the amount of waste produced in Scotland, making recycling a part of everyday life for households and businesses, reducing the amount of waste that ends up in landfill, and improving landfill gas capture through progressive introduction of methane capture and oxidation systems.

4.3.2 Despite this, large-scale system change is required to drive a more rapid transition to net zero and a circular economy in Scotland. The policies and proposals set out in the draft CCP under this sector are designed to tackle the territorial emissions that result from the waste management sector to 2040 and the wider carbon impact of Scotland’s waste, by changing how Scotland produces, consumes and manages its resources.

Relevant key pressures and trends

• The greatest drivers of change in biodiversity in Scotland include pollution.
• There is a recognised need for the development industry to move towards sustainable materials and a circular economy model.

Outcomes

4.3.3 There are five outcomes for the Waste sector set out in the draft CCP. A full list of the individual policies and proposals which feed into these outcomes can be found in Appendix A. The outcomes are:

• Strengthen the Circular Economy
• Reduce and Reuse
• Modernise Recycling
• Decarbonise Disposal
• Other Sources (anaerobic digestion and composting and wastewater)

Assessment findings

4.3.4 Where policies were previously assessed in the SEA for the CCPu (2020), findings identified the potential for positive effects on climatic factors and material assets. There could be requirements for a greater number of additional recycling and waste management facilities which could have negative impacts on soil from land take. Other negative effects may also arise from the construction and operation of such facilities through nuisance impacts such as noise, vibration and odour. The significance of the identified impacts will be dependent on the scale, nature and location of developments and likely to be experienced at a local level. Taking into account the updated baseline, we consider these findings to remain valid. In addition, many of the policies and proposals for inclusion in the waste sector package are also actions from Scotland’s Circular Economy and Waste Route Map to 2030, published in 2024, and have been subject to SEA during development^[159]. The findings from this process also remain valid, noting potential for positive effects across all environmental topics assessed.

4.3.5 For many of the proposals and policies within the Waste sector, positive effects on both material assets and climatic factors are anticipated. The development of a Circular Economy Strategy and new circular economy targets, for instance, may have positive effects on these topics by driving more efficient use of resources, reducing waste, and lowering emissions associated with production and disposal. The draft strategy has recently been published, alongside an environmental assessment, for consultation. Developing public procurement opportunities that reduce the environmental impact of public spending may also contribute positively due to the significant influence over supply chains, with prioritising low-carbon, circular products and services reducing emissions and promoting reuse and recycling. Policies aimed at improving household and commercial waste and recycling services, including the expansion of plastic packaging collections and the introduction of statutory targets, are also likely to have positive effects on both climatic factors and material assets. By increasing the consistency and scope of recycling services, these measures may help to reduce greenhouse gas and airborne pollutant emissions associated with landfill and material production. They also encourage better use of existing infrastructure and natural resources, which can help to further reduce reliance on landfill.

4.3.6 Where policies and proposals promote circular economy practices in the construction sector, positive effects are further anticipated for both climatic factors and material assets. Encouraging reuse and low-carbon practices can help to reduce demand for materials and extend the life of existing infrastructure. Indirect positive impacts are also anticipated for Landscape through reduced demand for unsightly disposal and extraction infrastructure, and potential to reduce litter and flytipping through more sustainable resource management practices. Circular practices in the construction and demolition sector should also encourage the retention, reuse and repair of historic environment assets and materials, leading to positive effects.

4.3.7 Other policies such as reviewing service charging, strengthening enforcement tools, and improving commercial waste understanding and compliance may also contribute positive effects indirectly to climatic factors and material assets. Improved enforcement and data collection can help ensure that waste is managed appropriately, potentially reducing illegal dumping and associated contamination risks. Better targeting of services and communications may also support more efficient use of waste infrastructure and reduce pressure on landfill and treatment facilities. Depending on the content of a new/developing Residual Waste Plan, positive (but uncertain) effects may also be anticipated for both of these environmental topics. Measures such as energy audits, energy recovery, and improved resource recovery can reduce emissions from wastewater treatment. Enhancing the efficiency of anaerobic digestion and composting for biodegradable materials like food and garden waste can help to reduce emissions associated with these materials leading to positive effects for climatic factors.

4.3.8 Policies and proposals which introduce or reform product stewardship and extended producer responsibility across a range of sectors (including priority products like packaging, textiles, batteries, WEEE, vehicles, fishing gear) are likely to have overall positive effects on the climatic factors topic. Encouraging reuse, recycling, and more sustainable design as well as placing greater responsibility on producers can help to reduce emissions both directly and indirectly. Policies and proposals with a focus on reducing food waste through supporting businesses, mandatory reporting, and household behaviour change, are also expected to have positive effects on climatic factors. Food waste contributes significantly to greenhouse gas emissions, particularly methane from landfill, and reducing it can help mitigate climate impacts.

4.3.9 Where new policies and proposals seek to develop measures to tackle consumption of single-use items and promote uptake of reusable alternatives additional, positive impacts are anticipated for climatic factors and biodiversity. Manufacturing single-use items can often involve fossil fuels, with reusable items generally having a lower carbon footprint. Single use items are a major contributor to pollution (both land and sea) and reducing their use may help to lessen contamination in ecosystems and resulting negative effects on biodiversity. Proposals which support reusable packaging and introduce reuse targets may also benefit climatic factors and biodiversity through similar means.

Key findings

• Positive effects are anticipated for climatic factors, material assets, cultural heritage, landscape, air and biodiversity through various circular economy initiatives, improved waste services, and extended producer responsibility policies.
• Localised negative effects on soil may arise from the construction and operation of new waste facilities.

Mitigation and enhancement

4.3.10 While the assessment has identified broadly positive effects on material assets and climatic factors, these will depend on the scale and consistency of policy implementation. To strengthen these effects, enhancements such as embedding sector-specific circular economy approaches within priority sectors could be made, ensuring that high-impact sectors like construction are directly targeted. The draft Circular Economy Strategy, currently out to consultation, sets out proposed priority sectors and proposals to embed circular economy approaches across different sectors, and presents an opportunity to collect feedback on these options. Directly prioritising these industries more generally across the suite of proposals could enhance most of the anticipated positive effects on climatic factors.

4.4. Energy Supply

Introduction

4.4.1 The energy supply sector covers two broad elements. The first is electricity generation and power stations. We have already made substantive progress, with current emissions just under 1 MtCO2e in 2023. Remaining emissions arise from three main sources: Peterhead gas-fired power station (~0.6 MtCO2e, 2023); Energy from Waste sites (~0.3 MtCO2e, 2023), and island diesel generators (~0.05 MtCO2e 2023). There are additionally a small number of emissions from other fuels (~0.02 MtCO2e, 2023). The second covers oil and gas supply emissions as a result of refining of crude oil into petroleum, the operation of terminals to manage the import and onshoring of oil and gas, leakage of gas from pipelines and emissions associated with the onshore production of oil and gas. Emissions from this sector were 2.85 MtCO2e in 2023.

4.4.2 Oil and gas currently account for around 77% of Scottish energy consumption. The biggest users are the energy industry, road transport and domestic heating. This demand is currently met through a mixture of domestic production (i.e. from the North Sea, including West of Shetland) and imports. The geological maturity of the North Sea basin means that domestic production is forecast to decrease significantly over the next decade.

4.4.3 Our renewables sector continues to grow; in 2023, 70% of electricity generated in Scotland was from renewable sources – a marked increase compared to 32% in 2013. The total amount of renewable electricity generated increased by 11.5% between 2023 and 2024.

Relevant key pressures and trends

• Between 1990 and 2023, there was a 51.3% reduction in estimated net emissions in Scotland, a 41.6 MtCO2e decrease, with all sectors except international aviation and shipping, falling over the period.
• The most significant contributors to this decrease were energy supply, industrial emissions, waste management, buildings and product use, and land use change and forestry (LULUCF).
• Development pressure from renewable energy infrastructure may affect the setting of historic landscapes and assets especially in coastal and upland areas. These pressures may also vary regionally or between urban and rural areas.

Outcomes

4.4.4 There are two outcomes for the Energy Supply sector set out in the draft CCP. A full list of the individual policies and proposals which feed into these outcomes can be found in Appendix A. The outcomes are as follows:

• By 2035, emissions will have reduced from thermal power generation to 0.4MtCO2e through the use of CCS, renewable power and alternative power means.
• Support the decarbonisation of Non-Road Mobile industrial and Construction Machinery.

Assessment findings

4.4.5 New policies and proposals outlined are expected to have positive impacts on climatic factors due to proposed inclusion of Energy from Waste (EfW) in the UK Emissions Scheme and setting requirements for decarbonisation strategies in new EfW facilities. Reduction in diesel reliance on Scottish islands through alternative energy sources like Hydrotreated Vegetable Oil (HVO) and acceleration of the Acorn Project and Scottish Cluster for CCS are also likely to have positive results overall for climatic factors. Where proposals seek to reduce emissions from non-road machinery there is the potential for further positive impacts for climatic factors, as well as for air and population and human health. Promoting alternative fuels and more efficient machinery may directly reduce CO2 and other greenhouse gases. Reducing the use of diesel and particulate emissions may benefit both air quality and human health.

4.4.6 Improved air quality is anticipated from reduced incineration of plastics, lowering toxic emissions, removal of recyclable plastics from waste streams, transition away from diesel power stations, especially in island communities and cleaner technologies in EfW facilities. This also has positive impacts on related human health.

4.4.7 Positive effects are anticipated for material assets where there is integration of EfW facilities with heat networks.

Key findings

• Overall positive effects are anticipated for climatic factors, air quality, population and human health and material assets.
• Integrating EfW facilities into heat networks requires careful planning and coordination with local authorities and energy providers. It is assumed that existing regulatory regimes will ensure that any development projects will be subject to appropriate controls, minimising the potential for any negative impacts from such schemes.

Mitigation and enhancement

4.4.8 For Energy Supply, key benefits relate to climatic factors, air quality, population and human health and material assets. Where EfW facilities are integrated into heat networks, these benefits could be enhanced where this also includes co-location of other uses such as residential and commercial developments.

4.5. Business and Industrial Process

Introduction

4.5.1 Decarbonising the industrial sector is critical to delivering net zero by 2045 and to help Scotland realise the economic benefits and key opportunities of the global transition to net zero. In 2023, 17.6% of total emissions came from Scotland’s business and industrial sector, emitting the equivalent of 7.0 MtCO2e per year (2023) of carbon dioxide^[160]. The Scottish Government aims to see this reduce by 5.2 MtCO2e by 2030 and 2.8 MtCO2e by 2040 while growing the economy.

4.5.2 Since the Climate Change (Emissions Reduction Targets) (Scotland) Act 2019 amended the Climate Change (Scotland) Act 2009, the CCP now requires a “business and industrial process” sector which differs slightly from the sector definitions in the previous 2018 Climate Change Plan, which followed the layout set by the 2009 Act as enacted. As a result, this sector now includes emissions from non-domestic buildings as well as industry and industrial processes (i.e. processes to create industrial products). The sector does not cover emissions or processes from oil, gas, nuclear or charcoal as these emissions in Scotland are now captured within the ‘Energy Supply’ sector.

Relevant key pressures and trends

• The main sources of emissions are transport, domestic and industrial.
• Increasing demand for modern industrial buildings, housing, and infrastructure, as well as the rapid growth of the renewable energy sector, is likely to place pressure on our valued landscapes.
• There is a recognised need for the development industry to move towards sustainable materials and a circular economy model.
• There is an increasing need to retrofit historic buildings for energy efficiency and climate resilience, which presents both opportunities and risks to fabric integrity and heritage value.
• Development pressure from renewable energy infrastructure may affect the setting of historic landscapes and assets especially in coastal and upland areas. These pressures may also vary regionally or between urban and rural areas.

Outcomes

4.5.3 There are two outcomes for the Business and Industrial Process sector set out in the draft CCP. A full list of the individual policies and proposals which feed into these outcomes can be found in Appendix A. The outcomes are:

• Scotland’s industrial sector will be on a managed pathway to decarbonisation, whilst remaining highly competitive and on a sustainable growth trajectory.
• Technologies critical to further industrial emissions reduction (such as carbon capture and storage and the production and use of hydrogen) are operating at commercial scale in the 2030s.

Assessment findings

4.5.4 Where policies and proposals were previously assessed in the SEA for the CCPu (2020), findings identified the potential for positive effects on climatic factors, air quality, population and human health and material assets. Potential negative effects were identified for landscape and historic environment as a result of the greater use of renewable energy technologies, such as solar panels and wind turbines. In addition, retrofitting of industrial buildings with energy efficiency measures may disturb biodiversity nesting in cavities, including species such as birds and bats. It was considered that many of these impacts may be localised. Negative effects were further identified for biodiversity, landscape and the historic environment, associated with the upgrading or conversion of existing infrastructure, and the installation of new infrastructure necessary to facilitate CCS. Some effects, such as those arising from activities such as storage and transportation, are expected to be neutral at this stage and can be considered through future assessment work. Taking into account the updated baseline, we consider these findings to remain valid.

4.5.5 Where new policies seek to increase the market for low carbon industrial products, additional positive impacts are anticipated for climatic factors as industries are incentivised to adopt cleaner technologies and reduce carbon emissions. Where new policies support SEPA in using existing regulatory powers to drive energy efficiency across priority sites, this may lead to additional positive impacts for climatic factors and air quality where energy efficient operations involve cleaner technologies and reduced fuel consumption, which lower the level of pollutants from these sites. In making this assessment it is assumed that SEPA will target priority sites with high energy use and high carbon emissions. Where new proposals seek to explore a new industrial decarbonisation programme and support the reduction of fossil fuels in chemicals and manufacturing, this also has the potential to lead to positive impacts for climatic factors through reduced GHG emissions. Additional positive impacts at local level may also arise for air quality and water where reduced reliance on fossil fuels helps to improve the localised environment surrounding such manufacturing facilities.

Key findings

• Overall positive effects are anticipated for air, climatic factors, population and human health, and material assets.
• Potential negative effects were identified for biodiversity, landscape, and cultural heritage associated with retrofitting of industrial buildings and infrastructure changes for CCS.

Mitigation and enhancement

4.5.6 Negative effects arising from retrofitting of industrial buildings and infrastructure development for CCS could be addressed in part through careful siting and design. This includes avoiding sensitive locations, integrating developments into the existing landscape, and ensuring that heritage assets are protected through early-stage assessments and consultation. Where retrofitting may disturb nesting species, timing works to avoid breeding seasons and incorporating ecological enhancements, such as artificial roosts or habitat features, can help reduce potential impacts.

4.6. Agriculture

Introduction

4.6.1 Agriculture is Scotland’s dominant use of land, covering 66% of the country. The nation supports a wide variety of farming practices, such as crop cultivation, crofting, hill farming, and livestock and dairy farming in lowland regions. More than half of this agricultural land is dedicated to upland sheep farming and mixed operations involving both sheep and beef cattle.

4.6.2 The way land is used for agriculture significantly shapes Scotland’s natural scenery and ecological systems. It helps maintain vital habitats that support biodiversity, including natural grasslands, cultivated fields, hedgerows, stone walls, streams, wetlands, moorlands, and upland pastures. Shifts in land use can affect wildlife habitats and impact water pollution levels, particularly through diffuse sources., The agriculture industry was the third largest source of emissions in Scotland in 2023, with annual emissions of 7.5 MtCO2e (19% of all emissions), mainly releasing nitrous oxide (N₂O) and methane, with smaller contributions of carbon dioxide (CO₂).

Relevant key pressures and trends

• Agriculture is Scotland’s dominant use of land, covering 66% of the country, with woodlands and forests covering 18%. These support a wide range of important flora and fauna diversity, including rare and threatened species.
• Agricultural intensification has contributed to habitat simplification and soil degradation in some areas, although reductions in fertiliser and pesticide use have improved the condition of some cultivated habitats in recent years.
• The Committee on Climate Change (CCC) in Scotland’s Carbon Budgets (2025) have suggested that by 2040, the agriculture and land use sectors will have to make the biggest contribution to emission reductions.

Outcomes

4.6.3 There are five outcomes for the Agriculture sector set out in the draft CCP. A full list of the individual policies and proposals which feed into these outcomes can be found in Appendix A. The outcomes are:

• A more sustainable Scottish agriculture sector that contributes to delivering Scotland's climate change targets and wider environmental outcomes while continuing to produce high quality, nutritious food.
• More farmers and crofters have the skills, knowledge and opportunity to implement climate change measures, continuing to produce high quality, nutritious food.
• Soil health is improved and nitrogen emissions, including from nitrogen fertiliser, have fallen.
• Reduced emissions from red meat and dairy through the implementation of measures, including improved efficiencies, new technologies and improved animal health.
• Carbon sequestration on agricultural land is increased, and carbon stores are maintained or increased.

Assessment findings

4.6.4 Where policies and proposals were previously assessed in the SEA for the CCPu (2020) findings generally identified the potential for positive effects on climatic factors, biodiversity, soil, population and human health and material assets. Taking into account the updated baseline, we consider these findings to remain valid.

4.6.5 New agricultural policies and proposals are anticipated to bring multiple environmental benefits by promoting efficiency and nature-friendly farming practices. These include positive effects for climatic factors where greenhouse gas emissions are reduced through improved farming operations and low-carbon technologies, positive effects for soils through enhanced soil structures and fertility via the uptake of improved soil management such as utilising organic methods and reduced tillage, and positive effects for water where water systems are protected through better nutrient and pesticide management. Encouraging alternative fuels and efficient machinery may also have positive effects for air quality, resulting in improved human health.

4.6.6 Whole Farm Plans encourage environmental considerations to be embedded into everyday farming decisions which can help promote low carbon interventions and encourage habitat protection and restoration. Monitoring and managing runoff, erosion and chemical usage may help to safeguard water bodies and maintain soil health.

4.6.7 Efficient fertilisers and inhibitors can reduce nitrogen leaching and emissions, while selective breeding for low methane traits in cattle may lower overall emissions leading to positive effects for climatic factors. Protecting peatlands and wetlands plays an important role in carbon storage, water regulation, and biodiversity resulting in positive effects for climatic factors, water and biodiversity. Tree planting on farmland is likely to enhance carbon sequestration, support wildlife habitats, and improve soil and water quality leading to positive impacts for climatic factors, biodiversity, soil and water and material assets. Additional tree planting may result in positive effects for landscapes, generally being considered to be visually appealing.

Key findings

• Positive effects are anticipated for climatic factors, soils, biodiversity, water, air quality, population and human health, material assets and landscapes.
• The effects of investigating and encouraging uptake of technologies for alternative, improved or more efficient fertilisers are considered to be uncertain as the level of uptake cannot yet be determined due to the early-stage of technological understanding.
• In undertaking this assessment it has been assumed that nature friendly farming may include practices such as growing organic produce and reduced tillage.

Mitigation and enhancement

4.6.8 The policies and proposals set out to meet the outcomes for the Agriculture sector are anticipated to have positive effects across a wide range of environmental topics. Opportunities to further enhance these positive effects could be achieved through supporting regional or landscape scale coordination of these actions.

4.7. Land Use, Land Use Change and Forestry (LULUCF)

Introduction

4.7.1 The Land Use, Land Use Change and Forestry sector (LULUCF) is a category used in greenhouse gas inventories to account for emissions and removals of greenhouse gases associated with the way land is used and managed. It includes activity such as forestry, cropland and grassland management and peatland degradation and restoration. It also includes emissions and removals associated with changing the main land use from one form to another, for example when converting land to grow crops or build settlements on sites that were previously grass. LULUCF is the only sector that currently generates net removals from the atmosphere. There are two key pillars within LULUCF: forestry and peatland.

Relevant key pressures and trends

• Wetlands, including peatlands, can be found across Scotland and are a key provider of ecosystem services such as carbon sequestration and water purification.
• Scotland’s land use is dominated by agriculture and forestry, which together account for around 80% of total land cover.
• New tree planting and restocking is regarded as a key tool to capture or offset carbon.
• Changes in weather patterns due to climate change present increasing risks to health from water scarcity, flood and drought.
• Approximately 80% of peatland is thought to be damaged. However, the majority of designated peatland sites were found to be in favourable condition.
• Climate change and loss of organic matter pose significant threats to Scottish soils, with both likely to affect soil function.
• Changes in land use and land management practices are a key pressure on soil.
• By 2050 it is predicted that without adaptive measure more than half of Scotland’s population will be at risk of leading to water scarcity during very dry periods, and that extreme storms will damage water and wastewater infrastructure.

Outcomes

4.7.2 There are seven outcomes for the LULUCF sector set out in the draft CCP. A full list of the individual policies and proposals which feed into these outcomes can be found in Appendix A. The outcomes are:

• To set and promote the national strategic approach to the integrated nature of land use and support and empower rural communities and stakeholders to co-develop natural capital led solutions that help address the climate and nature crises while delivering environmental, social, and economic benefits.
• An increase in annual woodland creation rates, with the consequent benefits of more carbon sequestration, rural employment and community benefits, enhancements to biodiversity, landscape and tourism, and support for agricultural business (e.g. shelter for livestock, wind and flood management).
• Increase the use of sustainably sourced wood fibre to reduce emissions by encouraging the construction industry to increase its use of wood products where appropriate.
• Protect and support the natural function of areas of peatland that are already in good condition, and prevent areas already degraded from deteriorating further.
• Support positive measures by landowners and managers to manage and improve degraded peatlands.
• Support focused interventions to return degraded peat to a more natural condition and reinstate the natural ecosystem functions and benefits they can provide.
• Continue to invest in world-class peatland research to inform the development of policy and practice.

Assessment findings

4.7.3 Where policies and proposals were previously assessed in the SEA for the CCPu (2020) findings identified the potential for positive effects on climatic factors, soil, water, biodiversity, material assets, population and human health, landscape, and cultural heritage. This assumes the Fourth Land Use Strategy will guide regional land use decisions that will enhance ecosystem services to support wider landscape benefits. Potential negative effects were identified for landscape and material assets due to land use conflicts that may arise, such as the loss of productive agricultural land to allow for woodland creation, or through the restoration of peatland. However, woodland creation is focussed on land that has limited agricultural potential, and there is a clear objective to integrate woodlands on farms in support of farm businesses. The effects of land use change on the wider environment including biodiversity, soil, water, population and human health, and cultural heritage could be mixed depending on the scale and nature of the change. Taking into account the updated baseline, we consider these findings to remain valid.

4.7.4 A number of new proposals and policies are anticipated to have overall positive effects on both the climatic factors and soil environmental topics. These include proposals which seek to strengthen the monitoring of peatland condition within all designated sites and support peatland restoration and rewetting, as well as those looking to document Scotland’s capacity, skills, capabilities and finance to deliver peatland restoration targets and attract and equip more people with the skills and knowledge needed to work in land-based and aquaculture sectors. Support for improved design and construction of wind farms on peatland may also lead to positive effects for both soils and climatic factors, with the potential for further positive effects for biodiversity where approaches to protecting and restoring peatlands help ensure peatland habitats are healthy and in good condition.

4.7.5 Additional positive effects for biodiversity are expected for new proposals within the LULUCF sector that seek to support crofters in their restoration efforts, and also to control deer numbers within areas identified for peatland restoration. Functional peatlands support many important species, habitats and ecosystems. Peatlands also store and clean water and as act as important natural flood plains, soaking up excess water and regulating run-off leading to additional positive effects for climatic factors (through adaptation) and water. The ability of peatlands to filter water helps to reduce treatment costs for public supplies and also helps to sustain quality drinking water for private supplies, which may also lead to additional positive benefits for human health and material assets.

4.7.6 New policies/proposals which support the continuing identification, protection, management and restoration of peatland and how this is monitored may contribute to reducing CO2 emissions and increased carbon sequestration, with positive effects for climatic factors. New policies/proposals which aim to identify and assess options for a carbon land tax have the potential for additional positive effects on climate however this is uncertain taking into account the stage of proposals and uncertainty around the nature of any change to be delivered.

Key findings

• Positive effects are anticipated for climatic factors, soils, and biodiversity, primarily through peatland restoration, rewetting, and improved monitoring.
• Additional benefits for water, material assets, and population and human health may arise from peatlands’ water storage function.
• Potential negative effects on landscape and material assets could occur due to land use conflicts, such as the loss of productive agricultural land for woodland creation or peatland restoration.

Mitigation and enhancement

4.7.7 Woodland creation will focus on areas with minimal or limited impacts on agricultural production and will also seek to integrate woodlands on farms in support of farm businesses, helping to mitigate against any potential loss of productive agricultural land to allow for woodland creation The potential for negative impacts on landscape can be mitigated if woodland creation schemes are appropriately designed and delivered to meet the requirements of the UK Forestry Standard. Local forestry and woodland strategies also identify the appropriate location for woodlands to maximise the delivery of public benefits and minimise adverse environmental and landscape impacts, and these should be considered at the onset. Specific forestry creation proposals may need to meet the requirements of the statutory processes for assessing impact on designated habitats or the wider environment, for example through Environmental Impact Assessment (EIA).

4.7.8 Positive effects could be enhanced by policies and proposals going further to support approaches which seek to maximise the multiple benefits that peatlands which are in good condition can provide, including for capturing and storing carbon, supporting nature, and reducing flood risk.