Decarbonising heating in homes and buildings

Housing Secretary awaits UK Government clarity

Housing Secretary Màiri McAllan has confirmed the Scottish Government will not introduce a Heat in Buildings Bill in the current session of the Scottish Parliament, following delays to the UK Government’s Warm Homes Plan and lack of clarity on cost of energy bills.

In a statement, Ms McAllan said she would not ask the Scottish Parliament to consider such an important Bill now with little time and without a full understanding of the UK policy context, due to several key policy levers being reserved and decisions delayed.

Ms McAllan reaffirmed the Scottish Government’s commitment to decarbonising buildings in Scotland by 2045 in a way that does not exacerbate fuel poverty, and announced additional grant support for homeowners of up to £7,500 (or up to £9,000 for households in island and remote rural areas) from December to incentivise connections to local heat networks. 

The Housing Secretary also said the government intended to bring forward legislation as early as possible in the next parliamentary session, subject to the outcome of the 2026 election and clarity on the UK Government position. A draft Buildings (Heating and Energy Performance) and Heat Networks (Scotland) Bill has been published to give clarity to households and investors on future plans for legislation. 

Decarbonising how we heat our homes and buildings is a vital step in our efforts to tackle climate change. We must take action and in a way that does not worsen fuel poverty. The Scottish Government is fully committed to this by 2045, as set out in our draft Climate Change Plan. 

We have always been clear that our plans depend on essential clarity from the UK Government, but repeated delays to their Warm Homes Plan have left key questions unanswered – particularly on how they intend to make the switch to clean heat more affordable by reducing the cost of electricity. 

This is critical in ensuring decarbonising homes does not exacerbate fuel poverty at a time of spiralling energy bills.

Ultimately, it is perverse that Scottish Ministers should be in the dark about plans related to Scotland’s own energy resources. If we had all the powers of a normal country – including over our own energy resources and market – we would not be in this position.

In the meantime, we are determined to continue to press ahead with our existing decarbonisation agenda including developing heat networks as a significant investment proposition and viable heating source for households. Therefore, I am pleased to confirm the extension of grant funding for households to connect to local district heat networks, bringing it into line with grants available to install heat pumps.

– MAIRI MCALLAN

Since 2020, the Scottish Government has allocated £1.67 billion of funding through its Heat in Buildings schemes, including over £840 million for energy efficiency and clean heat projects. Since 2020, the Scottish Government has supported an average of 15,000 households a year to decarbonise, including those in or at risk of fuel poverty and since the launch of Warmer Homes Scotland have helped over 47,000 households across Scotland to live in warmer homes that are more affordable to heat.  

Background  

The draft Buildings (Heating and Energy Performance) and Heat Networks (Scotland) Bill includes:  

• A heat decarbonisation target to replace direct emission heating systems in all Scottish buildings, as far as reasonably practicable, by 2045; 
• A regulation-making power to set a Minimum Energy Performance Standard for owner-occupied and non-domestic buildings that use direct emission heating systems; and 
• Provisions to encourage the development of heat networks, including a regulation-making power to require qualifying buildings within a heat network zone to connect to the heat network, or decarbonise their heating system 

Grant support will be introduced for homeowners to enable connections to heat networks through the Home Energy Scotland Grant and Loan scheme. Up to £7,500 of grant funding will now be available to homeowners, in addition to the optional £7,500 interest free loan. For those that qualify for island/remote rural uplift through the scheme, an additional £1,500 of grant funding will be available. 

The Scottish Government separately consulted on proposals for a Minimum Energy Efficiency Standard for the private rented sector earlier this year and will launch a targeted further consultation in the new year on detailed proposals for heat network installation and maintenance licences. 

The Scottish Government has also recently laid new Energy Performance Certificate (EPC) regulations which will bring an improved EPC rating system into force in autumn 2026.