Local Heat and Energy Efficiency Strategy and Delivery Plan

Argyll and Bute Council · 26 September 2024
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ARGYLL AND BUTE COUNCIL            COUNCIL          
DEVELOPMENT AND ECONOMIC GROWTH       26th SEPTEMBER 2024 
LOCAL HEAT AND ENERGY EFFICIENCY STRATEGY AND DELIVERY PLAN 
1.0 EXECUTIVE SUMMARY 
1.1 This report advises Members on the process of developing the Local Heat
and Energy Efficiency Strategy (LHEES) in accordance with the Council’s
statutory duties to prepare, publish and update a Local Heat and Energy
Efficiency Strategy and Delivery Plan as prescribed by the Local Heat and
Energy Efficiency Strategies (Scotland) Order 2022. The LHEES is also a
prescribed platform for reporting on any potential heat networks in the area
under the Heat Network (Scotland) Act 2021. 
1.2 When approved, the Local Heat and Energy Efficiency Strategy (LHEES) will
become the local authority’s long-term strategic framework for decarbonising
heat in buildings and improving energy efficiency across the entire local
authority area. 
1.3 The LHEES guidance states that the LHEES strategy and delivery plan
should be guided by the Scottish Government’s priorities to reduce
greenhouse gas emissions and alleviate fuel poverty. The LHEES aims to
harness the area's natural resources, enhance community wealth and foster
energy-resilient communities. The strategy also sets out potential
opportunities to lever in investment, access high-quality jobs and improve
supply chains by tapping into the economic prospects offered by the green
economy and the transition to net zero. 
1.4 The proposed consultative draft of the Local Heat and Energy Efficiency
Strategy and Delivery Plan in Appendix 1 has been developed with the input
of key stakeholders. The consultative draft has also been subjected to a
critical friend review by the Scottish Government and their consultants. 
1.5 Once approved by members, the consultative draft Local Heat and Energy
Efficiency Strategy and Delivery Plan will undergo a public consultation
process to allow wider engagement. The documents will then be revised to
reflect that consultation and then submitted to Council. Following that
approval, the document will be published on the Council's website. The

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documents will be periodically reviewed to reflect the fast changing legislative
and regulatory regimes. 
RECOMMENDATIONS 
It is recommended that Members consider and approve the proposed Local
Heat and Energy Efficiency Strategy and Delivery Plan contained in Appendix
1 of this report for public consultation.

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ARGYLL AND BUTE COUNCIL            COUNCIL
DEVELOPMENT AND ECONOMIC GROWTH       26th SEPTEMBER 2024 
LOCAL HEAT AND ENERGY EFFICIENCY STRATEGY AND DELIVERY PLAN 
2.0 INTRODUCTION 
2.1  The Local Heat and Energy Efficiency Strategy (LHEES) is the local
authority’s long-term strategic framework for decarbonising heat in buildings
and improving energy efficiency across an entire local authority area. It is also
a prescribed platform for reporting on any potential heat networks in the area
under the Heat Network (Scotland) Act 2021.   
2.2   The LHEES strategy and delivery plan is to be primarily guided by the
Scottish Government’s priorities to reduce greenhouse gas emissions and
alleviate fuel poverty. The proposed Argyll and Bute LHEES sets out potential
opportunities to lever in investment, access high-quality jobs and improve
supply chains by tapping into the economic prospects offered by the green
economy and the transition to net zero. 
2.3 The Scottish Government, Scottish and Southern Energy Network, and
Scottish Power Energy Network consider the LHEES documents the
framework for the Council to set out its priorities for grid upgrades and will be
important in advocating for these going forward. 
3.0 RECOMMENDATIONS 
3.1  It is recommended that Members consider and approve the proposed Local
Heat and Energy Efficiency Strategy and Delivery Plan contained in Appendix
1 of this report for public consultation.

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4.0 DETAIL 
4.1 The Local Heat and Energy Efficiency Strategy (LHEES) is the local
authority’s long-term strategic framework for decarbonising heat in buildings
and improving energy efficiency across an entire local authority area. The
Local Heat and Energy Efficiency Strategies (Scotland) Order 2022 places a
statutory requirement on local authorities to prepare, publish and update a
Local Heat and Energy Efficiency Strategy and Delivery Plan. The order
mandates that local authorities follow the LHEES guidance when preparing
their Local Heat and Energy Efficiency Strategy and Delivery Plan.
Additionally, local authorities are required to keep these documents under
review. 
4.2  The Heat Network (Scotland) Act 2021 places a duty on councils to identify
heat networks within their jurisdiction. The Local Heat and Energy Efficiency
Strategy (LHEES) functions as a prescribed platform for reporting on potential
heat networks. 
4.3 The Scottish Government developed the LHEES Methodology which is a step
by step approach including models, tools and templates, and represents best
practice in how to produce an LHEES in accordance with the requirements set
out in the LHEES Order and Guidance. The methodology includes several
stages, starting broadly and becoming more focused and action-oriented, as
outlined in Figure 1. 
Figure 1: The LHEES process 
The LHEES process requires local authorities to: 
• Summarise how the LHEES interacts with other local policies and strategies.
• Outline heat decarbonisation and energy efficiency progress in their
administrative area.
• Identify local priorities to facilitate heat decarbonisation and reduce the
demand for heat. 
• Identify potential heat networks.

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• Set out decarbonisation options and the financial cost of implementing these
options.
• Undertake stakeholder engagement to ensure key stakeholders implement
heat decarbonisation and energy efficiency priorities.
The LHEES guidance states that the strategy should:
• set out how each segment of the building stock needs to change to meet
national and local objectives, including achieving zero greenhouse gas
emissions in the building sector and the removal of poor energy efficiency
as a driver of fuel poverty; 
• identify strategic heat decarbonisation zones and set out the principal
measures for reducing building emissions within each zone and 
• prioritise areas for delivery against national and local priorities.
4.4 The LHEES strategy is accompanied by the LHEES Delivery Plan. This plan
sets out the measures for local communities, governments, investors,
developers, and broader stakeholders, identifying targeted intervention areas
and early, low-regret actions. The delivery plan will serve as a crucial
instrument in guiding governmental funding and private investments toward
the decarbonisation of heat. 
4.5      Argyll and Bute’s LHEES Priorities
Argyll and Bute’s LHEES has set eight priorities. The first five priorities were
identified during the two stakeholder engagement sessions carried out during
stage 6 (Figure 1) of the LHEES process. Priorities six to eight were also
identified as priorities, as unless these were addressed, the first five priorities
agreed through the engagement sessions could not be implemented. The
eight priorities are as follows and shown in Figure 2: 
1. Building sustainable and energy-resilient communities 
2. Challenging fuel poverty 
3. Ensuring a “Just transition” to net zero. 
4. Decarbonising heat sources 
5. Advocating a fabric-first approach to ensure buildings are heat pump-ready 
6. Addressing grid capacity   
7. Tackling supply chain constraints and shortage of skills

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8. Improving education and awareness of decarbonisation requirements and
solutions 
Figure 2: Argyll and Bute LHEES priorities. 
4.6   Governance 
The Local Home Energy Efficiency Strategy (LHEES) process was initiated
over a year ago in May 2023. Progress on the LHEES has been regularly
reported to the Climate Change Board and the Policy and Resources
committee. 
4.7   Consultation and engagement
The LHEES has been developed through an engagement process with key
stakeholders. This included delivering two stakeholder events to determine
priorities, and a further session was held with Argyll and Bute Energy
Efficiency Forum. The Scottish Government also required the draft LHEES
strategy to undergo a critical friend review carried out by Turner and
Townsend consultants and the Scottish Government’s LHEES Unit. 
4.8 The next stage is for the Local Heat and Energy Efficiency Strategy and
Delivery Plan to undergo a formal consultation process to obtain broader input
from stakeholders and the community. Subsequent to this engagement,

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necessary modifications should be implemented, and the finalised documents
should then be submitted to the council for approval. 
4.9 Like many councils, Argyll and Bute’s Delivery Plan outlines high-level actions to
deliver the LHEES priorities. After approval of the documents, the next stage involves
collaborating with stakeholders to agree on how to tackle these high-level
actions and then developing them into detailed actions and assigning
responsibility for each action to a specific stakeholder. Targets, milestones,
and indicators will be set for each action to monitor progress. Additionally, the
delivery plan will develop how these actions will be funded. 
4.10 Work is ongoing to improve collaboration with electricity network distributors,
such as Scottish and Southern Energy Networks and Scottish Power Energy
Networks.  By using their recently developed tools to identify locations where
grid constraints pose hindrances to advancing LHEES priority projects, it is
hoped the electricity network distributors can petition the regulator for
additional investment to facilitate infrastructure enhancements needed to
deliver LHEES priorities. 
4.11 The LHEES process is in its early stage; considerable work is being done by
stakeholders to collect, aggregate and disseminate data to enhance the
LHEES. Consequently, there has been a rapid proliferation of new data
streams. The decarbonisation industry is also undergoing rapid evolution,
introducing innovative technical solutions at an accelerated pace. Additionally,
the regulatory and financial landscape in this policy area is also rapidly
changing. For instance, the Heat in Building Bill and the revised Energy
Performance Certificate (EPC) legislation, both of which will significantly
impact the LHEES, are scheduled to be enacted by the Scottish Parliament in
2025. Consequently, the LHEES will need to be a flexible document that is
regularly updated to align with the duties outlined in these bills, take account
of new technological solutions and reflect new funding and investment
opportunities as they arise. 
5.0 CONCLUSION
5.1 The Argyll and Bute LHEES 2024 has been developed over the last year. It
has been informed by partnership engagement and has undergone a critical
friend review by Turner and Townsend and the Scottish Government in July
2024. Both processes supported the priorities identified, and that the council
should implement the consultation and engagement steps outlined above. 
5.2  The LHEES forms a strategic framework for partnership working and will be
subject to regular updates. It will also provide the crucial basis for future
bidding for resources to enable implementation of decarbonisation works.

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5.3 The LHEES acknowledges the challenges of decarbonising and aims to work
with the UK and Scottish Government and stakeholders to address these and
embrace the opportunities provided by our rural, natural resource-based
economy. 
6.0 IMPLICATIONS
6.1  Policy – The Local Heat and Energy Efficiency Strategy 2024 sits within the
framework of national policy objectives and local requirements. It relates to
the Council’s Decarbonisation Plan, LDP and Local Outcome Improvement
Plan and will relate to the Community Planning Partnerships Climate Change
Plan.   
6.2 Financial—The Scottish Government provides resources to local authorities to
develop the LHEES strategy and delivery plan and for staff to coordinate the
implementation of the plans. Additional resources will be required to
implement the actions outlined in the LHEES Delivery Plan. 
6.3 Legal - all appropriate legal implications have been taken into consideration. 
6.4  HR – none. 
6.5 Fairer Scotland Duty - the Fairer Scotland Duty, Part 1 of the Equality Act
2010, came into force in April 2018. The duty places a legal responsibility on
particular public bodies in Scotland, such as Argyll and Bute Council, to pay
due regard to (actively consider) how they can reduce inequalities of outcome
caused by socioeconomic disadvantage when making strategic decisions and
how this has been implemented. 
6.5.1  Equalities - all activities have complied with all Equal
Opportunities/Fairer Scotland Duty policies and obligations. 
6.5.2  Socio-economic Duty - One of the key priorities within the LHEES is to
tackle fuel poverty.
6.5.3  Islands - The LHEES will include priorities and actions that will be
delivered across Argyll and Bute, including the island communities. 
6.6  Climate Change - strategic priorities and activities will address the net zero
transition agenda. 
6.7 Risk - Buy-in by key partner agencies and stakeholders could be challenging
due to the uncertainty around future funding streams. If Grid infrastructure
works are not undertaken quickly, this may have significant implications for
implementing projects that enable the electrification of heat. 
6.8 Customer Service – none.

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6.9  The Rights of the Child (UNCRC) – none. 
Kirsty Flanagan, Executive Director with responsibility for Development and
Economic Growth
Councillor Jim Lynch, Depute Policy Lead for Economic Development, Housing,
Communities and Islands 
For further information contact: 
Fergus Murray, Head of Development and Economic Growth 
Fergus.Murray@argyll-bute.gov.uk 
Kirsty Jackson-Stark
Kirsty.Jackson-Stark@argyll-bute.gov.uk 
APPENDICES
Appendix 1 - LHEES Strategy and Delivery Plan 2024