Appendix 1 - Local Heat and Energy Efficiency Strategy and Delivery Plan 2024
Argyll and Bute Council · 26 September 2024
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Argyll and Bute Council LHEES Strategy 2 Table of contents EXECUTIVE SUMMARY 4 1. What is a Local Heat and Energy Efficiency Strategy? 122 1.1. Purpose 122 1.2. Structure 122 1.3. LHEES guidance from the Scottish Government 133 1.4. How this LHEES was developed 144 2. Policies and progress to net zero 19 2.1. National Policies 19 2.2. Local policies 222 2.3. Progress to net zero in Argyll and Bute 25 2.3.1. Plans and strategies 25 2.3.2. Education and Training 26 2.3.3. Decarbonising buildings 26 2.3.4. Examples of renewable energy generation (not an exhaustive list) 28 3. Stakeholder Engagement 31 3.1. Engagement with external stakeholders 31 3.2. Engagement with internal stakeholders 334 3.3. Community Engagement 366 3.4. Next Steps 36 4. Baselining Building Stock 37 4.1. Domestic buildings 37 4.2. Non-domestic buildings 48 5. LHEES Priorities 52 5.1. Address Grid Infrastructure 53 5.2. Building Sustainable and Energy Resilient Communities 53 5.3. Address supply chain constraints and shortage of skills 53 5.4. Improve education and awareness of decarbonisation requirements and solutions 54 5.5. Tackle Fuel Poverty 55 5.6. Ensure a “Just Transition” to Net Zero 58 5.7. Decarbonising the Heat Source 63 5.8. Energy efficiency, a fabric-first approach and getting buildings heat pump ready 70 6. Challenges 766 7. Opportunities 79 8. Next steps 810
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Argyll and Bute Council LHEES Strategy 3 9. Glossary 82 9.1. Abbreviations 823 9.2. Terms 83 10. Appendices 87 10.1. Appendix A: Additional National Policy Drivers 87 Appendix B: Datasets Used in the Development of the LHEES 889 10.3. Appendix C: Datasets and Limitations of the LHEES approach 911 10.4. Appendix D: LHEES Stage Descriptions 94 10.5. Appendix E: Detailed Methodology for the Identification of Potential Heat Network Zones 966 10.6 Appendix F: Heat Network Opportunities from Argyll and Bute’s Pilot Study 98
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Argyll and Bute Council LHEES Strategy 4 Executive summary Argyll and Bute’s Local Heat and Energy Efficiency Strategy (LHEES) sets out how to tackle greenhouse gas emissions from buildings, whilst also improving residents’ quality of life by addressing fuel poverty. Argyll and Bute, and Scotland as a whole, aim to be net zero by 2045. This is a challenging target and the LHEES is a crucial step in planning the Council’s approach to achieving this goal. Argyll and Bute Council’s LHEES strategy aims to: 1. Address grid capacity 2. Build sustainable and energy-resilient communities 3. Tackle supply chain constraints and shortage of skills 4. Improve education and awareness of decarbonisation requirements and solutions 5. Tackle fuel poverty 6. Ensure a “Just transition” to net zero 7. Decarbonise heat sources 8. Advocate for a fabric-first approach to ensure buildings are heat pump-ready
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Argyll and Bute Council LHEES Strategy 5 What is a Local Heat and Energy Efficiency Strategy? This LHEES uses an evidence-based approach to identify the most suitable heat decarbonisation approaches for building types and areas. It also recommends where resources should be targeted to ensure existing buildings are energy efficient and are heated with a low or zero carbon heat source. The LHEES has been developed in accordance with the Scottish Government’s methodology, which entailed: • Carrying out a policy and strategy review: assessing the local and national policy framework, to inform the Argyll and Bute LHEES. • Undertaking data analysis of the building stock. • Identifying strategic zones and decarbonisation pathways. • Determining priorities and initial delivery areas. • Engaging with stakeholders. The LHEES process concludes with producing two documents: the LHEES Strategy and the LHEES Delivery Plan. The LHEES Strategy is a long-term strategic framework for decarbonising heat in both domestic and non-domestic buildings and improving energy efficiency across Argyll and Bute. It is published alongside the LHEES Delivery Plan, which sets out how Argyll and Bute Council will implement the strategy. The Council cannot accomplish this alone and will require the assistance of numerous stakeholders to carry out the actions in the delivery plan. The regulatory landscape will change quickly over the next few years to drive progress in decarbonising buildings in Scotland. The LHEES Strategy and Delivery Plan will be flexible and iterative. These documents will be revised to react to legislative changes, technological advancements, and market changes and ensure that the benefits from new opportunities are realised. The LHEES was developed using a variety of engagement mechanisms to ensure that internal and external stakeholders informed the evidence base and analysis at all stages of the LHEES. It is important to note that the LHEES process is iterative and so stakeholder input will continue to shape the documents, as they are intended to be dynamic and adaptable rather than static.
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Argyll and Bute Council LHEES Strategy 6 Local authority’s LHEES priorities As introduced above, the Council has identified eight priorities for the LHEES: • Addressing grid capacity • Building sustainable and energy-resilient communities • Address the supply chain constraints and shortage of skills • Improve education and awareness of decarbonisation requirements and solutions • Tackle fuel poverty • Ensure a “Just transition” to net zero. • Decarbonise heat sources • Energy efficiency, a fabric-first approach and getting buildings heat pump-ready Figure 1: LHEES Priorities identified by Argyll and Bute Council Heat and energy efficiency in Scotland In 2018, the Intergovernmental Panel on Climate Change (IPCC) advised that to reach the 1.5°C target set in the Paris Climate Accord, the world needs to reach net zero carbon emissions by 2050. The Climate Change (Emissions Reduction Targets) (Scotland) Act 2019 set an ambitious target of Scotland reaching net zero by 2045. Achieving net zero is crucial to mitigating the impacts of climate change to stabilise global temperatures. This is a vital step to avoid the worst consequences of climate change. According to the Scottish Government’s Heat in Buildings Sustainable, enegy resilient communities mproved grid capacity Skills and the supply chain mprove knowledge and awareness Tackling fuel poverty Energy Efficiency and Fabric first approach ecarbonising heat sources Just transition
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Argyll and Bute Council LHEES Strategy 7 Consultation1, “The way we heat our homes, workplaces and other buildings is the third-largest cause of greenhouse gas emissions in Scotland”. To meet the net zero target, both domestic and non-domestic buildings in Scotland will have to significantly reduce their carbon emissions. Heat and energy efficiency in Argyll and Bute Argyll and Bute Council is already making progress toward achieving its goals of decarbonisation and improving energy efficiency. This is being achieved by: Non-Domestic Energy Efficiency Fund 1 The Council is investing in improving energy efficiency to reduce energy demand and installing low or zero carbon heating systems to reduce carbon emissions in its own non-domestic building stock. The Council’s Non-Domestic Energy Efficiency Fund (NDEEF1) had 50 decarbonisation and energy efficiency projects, 49 of which have been completed this year. The Council is currently selecting projects for NDEEF2. The Council’s Decarbonisation Plan The Council’s ecarbonisation Plan specifies the actions the Council will take to address climate change. This plan has a decarbonisation tracker, which was last updated and approved by the Council's Policy and Resources Committee in February 2024. The LHEES strategy aims to build on this work to provide an energy efficiency and heat decarbonisation framework for other Public Sector Buildings (PSB) and private sector non-domestic buildings. Local Development Plan 2 The Council’s Local evelopment Plan 2 provides the local planning framework for the council area. It includes policies that encourage energy efficiency and the development of heat networks. Local Housing Strategy The Local Housing Strategy for Argyll and Bute is underpinned by four foundational pillars. One of these pillars focuses on addressing poor building condition, reducing energy demand through energy efficiency measures, and decarbonising heating systems. This strategy sets out a series of actions aimed at bolstering the sustainability of housing in Argyll and Bute, optimising energy efficiency, and ensuring a greater proportion of the energy used to heat buildings is derived from low or zero carbon heat sources. Energy Efficiency Services The Council administers the Area Based Scheme (ABS), which aims to improve energy efficiency of homes for owner occupied and privately rented properties. In addition, the Council, working in 1 Scottish Government (2023) Delivering net zero for Scotland's buildings - Heat in Buildings Bill: consultation. Available at: https://www.gov.scot/publications/delivering-net-zero-scotlands-buildings- consultation-proposals-heat-buildings-bill/documents/ (Accessed 16/07/2024).
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Argyll and Bute Council LHEES Strategy 8 partnership with Housing Associations, has delivered energy efficiency measures through the Warmer Homes Scotland programme. Homes in Argyll and Bute have also benefited from the Energy Company Obligation (ECO) programme, which has funded several energy efficiency and decarbonisation measures. Next steps The LHEES will support the Council and its Community Planning partners to scale up existing programmes and leverage in new investment. It will identify the necessary actions to accelerate the scale and pace of retrofit and facilitate the development of decarbonised heating systems, including heat networks, which are essential to meeting the national net zero emissions target by 2045. Argyll and Bute building stock The LHEES methodology included a "baselining exercise" to identify key attributes and characteristics of the housing stock in Argyll and Bute. Establishing this baseline will enable future iterations of LHEES to monitor and evaluate progress effectively. Additionally, this baseline provides the Council with evidence-based data, allowing it to target interventions with the most significant impact. Domestic property The predominant building types in Argyll and Bute are solid brick or stone structures, which represent 39% of the stock. Cavity-walled buildings comprise 32% of the stock, and timber frame constructions constitute 22%. The area exhibits a notable prevalence of custom-built bespoke properties, which poses challenges for large-scale retrofitting initiatives due to the absence of prevalent building archetypes. According to the 2023 Scottish Islands Data Overview, Argyll and Bute has one of the highest rates of fuel poverty in Scotland, with approximately 32% of residents affected2. The Council is committed to alleviating fuel poverty, and the LHEES Delivery Plan sets out a series of actions to realise this ambition. Following the transfer of all housing stock, the Council no longer manages social housing assets but continues to exert influence as the area’s housing authority. The Council and the four largest housing associations, namely Argyll Community Housing Association(ACHA), Dunbritton Housing Association, Fyne Homes, and West Highland Housing Association have established the HOMEArgyll partnership, which focuses on providing quality housing. HOMEArgyll partners are members of the Argyll and Bute Energy Efficiency Forum. Other partners include: • Home Energy Scotland 2 Scottish Government (2023) Scottish Islands Data Overview (2023) URL: Scottish Islands Data Overview (2023) (www.gov.scot)
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Argyll and Bute Council LHEES Strategy 9 • ALIenergy, covering the whole of Argyll and Bute • Registered Social Landlords and Housing Associations (HOMEArgyll Partners): • Argyll and Bute Care and Repair • Citizens Advice Bureau • Islay Energy Trust • Iona Renewables The Argyll and Bute Energy Efficiency Forum, chaired by the Council's Home Energy Efficiency Team, is dedicated to promoting and coordinating the efforts of local organisations with the shared objectives of enhancing home energy efficiency, alleviating fuel poverty, and addressing the challenges posed by climate change. Much of the land mass in Argyll and Bute is off the mains gas grid, necessitating a reliance on alternative heating fuels such as oil, LPG, electricity, and biomass. Notably, 33% of buildings in the area use electricity as their primary fuel type according to Home Analytics (v.3.9), three times higher than the national average. Due to the highly constrained electricity grid infrastructure, the LHEES strategy prioritises households already using electricity as their primary fuel type. Electricity grid limitations mean that currently it is unfeasible for many communities that don’t currently use electricity to heat their homes to transition to electrified heat. The LHEES strategy identifies a range of other potential options for heat decarbonisation. The LHEES Delivery Plan sets out a series of actions to assess the viability of these heat options for communities within Argyll and Bute. Non-domestic property According to Non-Domestic Analytics, the heat demand of non-domestic buildings in Argyll and Bute is 488,583 MWh/yr, which equates to 38% of the total heat demand of buildings in the area. Buildings such as hotels, holiday lets, and leisure facilities have larger average heating demands per property than offices and retail premises. Electricity provides 236,428 MWh/yr of heat to non-domestic properties in Argyll and Bute, 48% of the total non-domestic heat demand. Although electricity is the primary source of fuel, buildings using mains gas, oil, and other fuels typically have a higher average heat demand. Argyll and Bute heat networks The Scottish Government’s Heat in Buildings Strategy has identified heat networks as a low-regret decarbonisation option. The Council has conducted a data-driven analysis highlighting potential areas for future heat network development. The analysis identified five potential heat network zones that warrant further investigation. This figure is notably lower than most local authority areas
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Argyll and Bute Council LHEES Strategy 10 in Scotland. This can be attributed to the fact that forty-three percent of Argyll and Bute's population reside in areas classified as 'remote rural’3, characterised by low population density and heat demand, making them less conducive as viable heat networks. As there are only a few potential heat network zones, the Council commissioned an additional study by Burpo Happold to identify possible shared ground loops that effectively offer smaller-scale heat network opportunities. The study found several potential shared ground-loop opportunities, which will be explored further in the delivery plan. Challenges and Opportunities Several challenges must be overcome to decarbonise Argyll and Bute’s buildings. These include: • Inadequate grid infrastructure: The significantly constrained grid infrastructure will prohibit the mass electrification of heat. • Limited decarbonisation options: Only five potential heat network zones were identified in Argyll and Bute. Consequently, most buildings within the area not will not connect to heat networks. Inadequate grid infrastructure makes mass transitioning to heat pumps unfeasible in many communities. Therefore, new or adapted decarbonisation options must be devised to enable heat decarbonisation in Argyll and Bute to be realised. • The Council does not have direct control over social housing: Argyll and Bute Council transferred all its housing stock and consequently, unlike most other councils, does not have direct control over social housing. • Financing decarbonisation: The area's geography means that communities face higher costs to decarbonise their buildings than their urban counterparts. Furthermore, the limited heat network opportunities make it harder to attract private sector investment. This, combined with diminishing government budgets, will make it challenging to resource the decarbonisation journey. • Skills and supply chain constraints: The shortage of contractors to install energy efficiency measures and heat decarbonisation technologies in the local authority area poses a significant risk to the progress of decarbonisation efforts. • Large number of bespoke buildings: The local authority area is characterised by bespoke, individual and diverse building styles. This means the cost per unit to retrofit is higher as the economies of scale realised by mass retrofitting of buildings with the same building archetype cannot be achieved for a considerable proportion of the building stock. Not all these challenges can be addressed in the first iteration of the LHEES Delivery Plan, as some will take many years to address. While there are challenges in delivering the LHEES priorities, there are also a wealth of opportunities, such as: 3 Argyll and Bute Council (2023) Quick Facts and Figures about Argyll and Bute URL: https://www.argyll- bute.gov.uk/my-community/quick-facts-and-figures-about-argyll-and-bute
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Argyll and Bute Council LHEES Strategy 11 • Community Wealth Building: There are opportunities for communities to retain more benefits from the energy generated in their communities. • Utilising surplus energy generated: Argyll and Bute’s natural assets currently produce more than 1 Gigawatt of clean energy, potentially generating over 5 Gigawatts over the next decade. Grid constraints mean that exporting all this energy is not always possible. Surplus energy can be harnessed to produce green hydrogen, charge batteries, or create thermal battery stores, and new technologies will provide additional commercial opportunities. • Local energy distribution opportunities: Some communities in Argyll and Bute already generate energy from wind turbines, micro-hydro, etc. The LHEES will be used to engage key stakeholders to explore how this energy can be distributed locally, providing low-cost heating options for communities. • Generation of higher-waged green jobs: Argyll and Bute is currently a low-wage economy, but as the supply chains grow, there will be many opportunities for new, higher- paid green jobs. The LHEES will enable further collaboration with key stakeholders to identify how best to harness these opportunities. • Opportunities to leverage in new public and private sector investment: Argyll and Bute's heat networks may be less profitable overall than in other parts of Scotland, but some still present attractive opportunities for investors. Furthermore, the Council is actively discussing potential investment in a decarbonised heat project with a private sector company and has also successfully secured government funding for another decarbonised heat project. This demonstrates that it is possible to access new investment to decarbonise heat. • Utilising new and existing technology to provide cheaper, cleaner energy: Argyll and Bute is strategically positioned to attract companies at the forefront of piloting new energy harnessing technologies. Furthermore, emerging technologies present novel solutions for decarbonisation, providing more cost-effective and environmentally friendly energy options for communities in Argyll and Bute that currently face limited decarbonisation choices. • Alleviate fuel poverty: The LHEES provides an opportunity to alleviate fuel poverty by engaging with communities and supporting them in developing and implementing local solutions.
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Argyll and Bute Council LHEES Strategy 12 1. What is a Local Heat and Energy Efficiency Strategy? 1.1. Purpose Achieving net zero is crucial to mitigating the impacts of climate change and stabilising global temperatures. This is a vital step to avoid the worst consequences of climate change. Heating homes and buildings is the third-largest cause of carbon emissions4. Consequently, domestic and non-domestic buildings in Scotland will have to significantly reduce their carbon emissions if net zero ambitions are to be realised. Building decarbonisation can be achieved by reducing energy demand, improving buildings' energy efficiency and transitioning to low and no-carbon heating systems. Scottish local authorities have a statutory duty to develop a Local Heat and Energy Efficiency Strategy (LHEES), as described in the Local Heat and Energy Efficiency Strategies (Scotland) Order 2022. The purpose of this LHEES is to present the evidence base that identifies what needs to be done across Argyll and Bute. It outlines required changes to buildings and local infrastructure, needed by 2045 to fulfil the Scottish Government’s objectives and local priorities, relating to heat in buildings. This LHEES sets out the long-term plan for decarbonising heat in buildings and improving energy efficiency across the entire local authority. The focus on locally led planning ensures that the decarbonisation of heat in buildings is delivered in a way that is relevant to local contexts and tailored to the specific needs of communities. 1.2. Structure LHEES has a two-part structure consisting of a strategy and a delivery plan. • The Strategy is a long-term strategic framework, covering the next 15-20 years, for decarbonising heat in buildings and improving energy efficiency across Argyll and Bute. It is framed around the six considerations outlined below (Table 1). Argyll and Bute Council’s Strategy is data-led and justifies the actions proposed. In short, this document demonstrates the direction the Council is moving towards. • The Delivery Plan accompanies the strategy. The plan is flexible and iterative, outlining how the Council will implement its strategy over the next five years. It outlines the areas requiring further analysis and investigation, and identifies low or no-regret measures for 4 Scottish Government (2023) Delivering net zero for Scotland's buildings - Heat in Buildings Bill: consultation. Available at: Delivering net zero for Scotland's buildings - Heat in Buildings Bill: consultation - gov.scot (www.gov.scot). (Accessed: 04/07/2024).
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Argyll and Bute Council LHEES Strategy 13 decarbonising heat in buildings. It provides a focus for the Council to consult and work with stakeholders to deliver the LHEES strategic objectives. Both documents will be reviewed and updated periodically to reflect legislative changes, progress towards net zero, new available technologies and funding, and changing priorities in the local authority. Argyll and Bute Council’s Strategy and Delivery Plan can be found on Argyll and Bute Council’s website. 1.3. LHEES guidance from the Scottish Government The Scottish Government’s LHEES guidance frames the strategy around six considerations relating to heat decarbonisation and energy efficiency. They identify and target interventions in different parts of the building stock. The six considerations are outlined in Table 1. Considerations relating to heat decarbonisation focus on decarbonising both off-gas grid and on- gas grid buildings, as well as areas with potential to develop heat networks. Considerations relating to energy efficiency and other outcomes focus on areas with poor building energy efficiency, such as no or low levels of insulation, and areas where this is likely to contribute to high levels of fuel poverty. This focus will ensure that energy efficiency projects will reduce fuel poverty. Mixed- tenure, mixed-use, and historic buildings are included as a separate consideration as these are likely to require different approaches. Table 1: Summary of the LHEES considerations No. LHEES Considerations Description Heat decarbonisation 1 Off-gas grid buildings Transitioning from heating oil and LPG in off-gas areas 2 On-gas grid On-gas grid heat decarbonisation 3 Heat networks Decarbonisation with heat networks Energy efficiency and other outcomes 4 Poor building energy efficiency Poor building energy efficiency 5 Poor building energy efficiency as a driver for fuel poverty Poor building energy efficiency as a driver for fuel poverty 6 Mixed-tenure, mixed-use and historic buildings Mixed-tenure and mixed-use buildings, listed buildings and buildings in conservation areas LHEES stages This LHEES has been developed over eight stages, as outlined in Table 2. Completing stages 1-6 provided the data analysis and evidence base that forms the foundation for the Argyll and Bute Strategy (Stage 7) and Delivery Plan (Stage 8).
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Argyll and Bute Council LHEES Strategy 14 Figure 2: Summary of LHEES Stages 1.4. How this LHEES was developed Argyll and Bute’s LHEES was developed in partnership with Changeworks. Table 2 displays the outputs of each stage and how they have been used in the LHEES process. Table 2: Summary of LHEES outputs and their use in the project. LHEES Stage Outputs and Formats Role in informing LHEES 1 Policy and Strategy Review (.pdf/.doc) Sets priorities for LHEES and highlights relevant national and local policy and strategy drivers 2 ata and Tools Library (.xlsx) ataset scoping and review exercise, including uses in subsequent LHEES stages and key contacts 3 Baseline Tools ( omestic and Non- omestic) (.xlsx) Maps (.pdf) ata outputs on Strategic Zones used in the identification and mapping of initial elivery Areas (Stage 4) 4 G S layers on Heat Networks (.mpkg) Summary table of clusters, resources and constraints (.xlsx) Summary table used for sense-checking of initial elivery Areas and G S layers and for deeper exploration of maps. Both outputs are further carried forward for deliberation in stakeholder workshops (Stage 6) 5 PEAT-OR Power-B Visual breakdown of potential costs and savings per total installation measures at property/ datazone levels. emonstrated in stakeholder workshops to identify potential elivery Areas
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Argyll and Bute Council LHEES Strategy 15 6 Ranked list of elivery Areas Used in the structuring and writing of the Strategy ocument and elivery Plan 7 Strategy ocument (.pdf/.doc) Story map of Strategy ocument Summary document of local authority’s building stock and opportunities for achieving net zero as well as challenges StoryMap used to supplement the Strategy document. 8 elivery Plan (.pdf/.doc) Final output highlighting priorities and actions in delivering LHEES for the next five years The analysis in Stage 3 separates buildings into four categories, which are primarily based on their suitability for a heat pump retrofit. The categories are defined in the Scottish Government’s LHEES guidance and are based on indicators from the Home Analytics dataset. Table 3 provides a brief description of each category and the process for categorising all domestic properties. Table 3: Building categories based on suitability for a heat pump retrofit Building category Description Indicators Category 0 Currently have a low or zero direct emissions heating system, or heat network connection • Properties with a heat pump (off-gas only) or communal heating as the main heating system Category 1 “Heat pump ready” buildings that are well-suited to heat retrofit with minimal other changes. • Cannot be a category 0 property • Not a listed building or in a conservation area • Properties with insulated walls and double or triple glazed windows • f the property has a loft, it must have at least 100mm of loft insulation • Properties which are likely to have a wet heating system (i.e. mains gas, LPG, Oil or Biomass/solid fuels) Category 2 Secondary potential for heat pump retrofit. Require some fabric and/or • Cannot be a category 0 or 1 property
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Argyll and Bute Council LHEES Strategy 16 distribution systems upgrades. • Properties that are cavity construction5 (either insulated or uninsulated), or any other construction type, with insulated walls • No risk of the property having a narrow uninsulated cavity • Properties can be listed or in a conservation area Category 3 Significant upgrades required to be heat pump ready. Off-Gas Categorisation Process The subcategory indicates the most viable decarbonisation technology. Heat pumps are the priority solution. The suitability of storage or direct electric heating, and biomass are indicated by the characteristics listed below: Category 3 – Heat pump • f the property is currently heated via an oil or LPG system Category 3 – Electricity (storage or direct) • Properties already using electricity as the main fuel type • Flats • Properties with double or triple glazed windows • Properties in urban areas (1, 2 or 3 in the 8-fold classification6) Category 3 – Biomass • Properties already using biomass as the main fuel type • Detached and semi-detached properties • Properties of a solid brick or stone construction type On-Gas Categorisation Process As per the off-gas categorisation process but there are no subcategories for electric and biomass options. 5 6 Scottish Government Urban Rural Classification 2020
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Argyll and Bute Council LHEES Strategy 17 Table 4 outlines how Changeworks’ methodology deviates from the standard LHEES methodology. Table 4: Summary of the deviations (if any) from standard methodology in the LHEES Considerations LHEES Consideration Standard LHEES methodology Deviation from standard LHEES method Off-Gas Grid Buildings Categories 0, 1, 2 and 3 properties determined according to the following factors: • Unlisted property • Not in a conservation area • Wall insulation • Double/triple glazed windows • Wet system replacement (except electric and no heating/hot water systems) • Loft insulation prediction (99mm +) Only wall insulation is considered in determining Category 1 properties for all heating types (boilers, room heaters, storage heaters, no heating/hot water systems). Additionally identified solar PV suitability for category 1 properties. On-Gas Grid Buildings Categories 0, 1, 2 and 3 properties determined according to the following factors: • Unlisted property • Not in a conservation area • Wall insulation • Double/triple glazed windows • Wet system replacement (except electric and no heating/hot water systems) • Loft insulation prediction (99mm +) Only wall insulation is considered in determining Category 1 properties for all heating types (boilers, room heaters, storage heaters, no heating/hot water systems). Additionally identified solar PV suitability for category 1 properties. Poor Building Energy Efficiency Energy efficiency score is determined by wall insulation status, loft insulation status and double glazing. As most programmes and projects are wall insulation focused, the weighted Energy Efficiency map only includes wall insulation potential, not glazing and loft. Poor Building Energy Efficiency and Fuel Poverty Energy efficiency and Fuel Poverty score is determined by wall insulation status, loft insulation status and double glazing and Fuel Poverty. As most programmes and projects are wall insulation focused, the weighted Energy Efficiency and Fuel Poverty map only includes
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Argyll and Bute Council LHEES Strategy 18 wall insulation potential, not glazing and loft. Engagement The LHEES was developed using a variety of engagement mechanisms to ensure that internal and external stakeholders informed the evidence base and analysis at all stages. Below is a summary of the engagement process; full details are outlined in Section 3. LHEES steering group In the early stages of the LHEES development, the Council set up an LHEES Steering Group with representation from relevant services. The steering group provided input and reviewed the LHEES's outputs. Stakeholder events The Council hosted two stakeholder events to determine the LHEES priorities. Engagement with Groups The Council is engaged with relevant partnerships, established groups and forums which shape the LHEES, such as: • The Climate Change Board • Argyll and Bute Energy Efficiency Forum • The Community Planning Partnership Engagement with the DSO The LHEES Officer has engaged with both Scottish and Southern Energy Network (SSEN) and Scottish Power Energy Network (SPEN). Engaging with both Distribution System Operators (DSOs)7 is vital to progressing the LHEES, as grid constraints will be the greatest barrier to decarbonising heat. Community consultation and engagement The Council will commence the wider community engagement process by consulting on the draft LHEES Strategy and Delivery Plan. Next steps After conducting the community engagement exercise, the councils will revise the LHEES documents based on the feedback received. The finalised documents will be made available on the Council's website. 7 Distribution Network Operators (DNOs) are currently transitioning to becoming DSOs in order to fulfil the duties that will be required for the grid to transition to net zero. The transition requires the electricity system to be managed in a much more dynamic way.
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Argyll and Bute Council LHEES Strategy 19 It is important to note that this does not mark the end of the engagement process; rather, it will facilitate broader stakeholder participation. Since the LHEES process is iterative, stakeholder input will continue to shape the documents, as they are intended to be dynamic and adaptable rather than static. 2. Policies and progress to net zero The LHEES is influenced by a range of different policies, strategies, and targets. The following subsections outline key policies that are relevant to the LHEES at local and national level. 2.1. National Policies In 2018, the Intergovernmental Panel on Climate Change (IPCC) advised that to reach the 1.5°C target set in the Paris Climate Accord, the world needs to reach net zero carbon emissions by 2050. The Climate Change (Emissions Reduction Targets) (Scotland) Act 2019 set an ambitious target of Scotland reaching net zero by 2045. Argyll and Bute’s LHEES is primarily driven by Scotland’s statutory targets for greenhouse gas emissions reduction and fuel poverty. Several national policies are relevant, particularly the Heat in Buildings Strategy, the Heat Network Act, and the Fuel Poverty Act. These policies are described below, followed by a table with further relevant national policies ( Table 5). A comprehensive list of national policies is outlined in Appendix A. Heat in Buildings Strategy The Heat in Buildings Strategy, published in 2021, sets out a vision that by 2045 Scotland’s homes and buildings are cleaner, greener and easy to heat, and no longer contributing to climate change. The strategy prioritises improvements to the fabric of buildings to reduce energy demand, alongside a focus on zero emissions heating systems. This LHEES will contribute to the targets set out in the Heat in Buildings Strategy by identifying measures for reducing building emissions and potential heat network zones. In the Heat in Buildings Strategy, the Scottish Government committed to the development of a Heat in Buildings Bill to provide a regulatory framework for zero emissions heating and energy efficiency. The Bill, which went under consultation in November 2023, proposes a minimum energy efficiency standard for private landlords by the end of 2028, and for owner-occupiers by 2033. It also proposes a ban on polluting heating systems in all buildings by 2045. The consultation closed in March 2024. Social Housing Net Zero Standard The Scottish Government has established targets to improve the energy efficiency of social housing. Previously, these have been set through the Energy Efficiency Standard for Social
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Argyll and Bute Council LHEES Strategy 20 Housing (EESSH). EESSH2 guidance required all social housing to meet an energy efficiency rating of EPC band B by 2032. In November 2023, the Scottish Government launched a consultation on a new Social Housing Net Zero Standard, which will replace EESSH2. The proposed new standard includes setting a minimum fabric efficiency rating (different to current EPC ratings) and introducing a requirement to replace polluting heating systems with clean alternatives by a backstop date of 2045, with possible interim targets before then. Heat Networks Act Heat networks supply multiple buildings with heat or cooling from a central source or sources. This avoids the need for individual boilers or electric heaters in every building. The Heat Networks (Scotland) Act 2021 defines a heat network as either a district heat system or a communal heating system. The Act provides the legislative framework to set up and regulate heat networks. It requires local authorities to review areas within their constituency that are potentially suitable for heat networks. This LHEES will function as the main vehicle by which Argyll and Bute Council will conduct this review. Fuel Poverty (Scotland) Act 2019 The Fuel Poverty Act was passed by the Scottish Parliament in 2019. A household is classified as fuel poor if, in order to maintain a satisfactory home heating regime, total fuel costs are more than 10% of the household’s adjusted net income (after housing costs), and if after deducting fuel costs, benefits received for a care need or disability and childcare costs, the household’s remaining adjusted net income is insufficient to maintain an acceptable standard of living. The interim set of targets laid out in this legislation are that by 2030, no more than 15% of households in Scotland are in fuel poverty, and no more than 5% are in extreme fuel poverty. This is with the aim of achieving the main target of no more than 5% of households in Scotland in fuel poverty, and no more than 1% are in extreme fuel poverty by 2040. Homes with a lower energy efficiency were identified as one of the key drivers of fuel poverty and the LHEES looks to address this pressing issue. By improving the energy efficiency of homes, fuel consumption can be reduced. LHEES can, therefore, provide support to reducing fuel poverty by mitigating energy efficiency as a driver. Energy Performance Certificate reform The Energy Performance Certificate (EPC) ratings evaluate a building based on various criteria, amalgamating them to generate an overall rating. However, there are limitations to this approach because the criteria cannot be separated, potentially skewing the ratings. For instance, one element of the rating considers the cost of using the heating system, which can disadvantage homes powered by electrical heating. As a result, this methodology does not accurately measure the building's energy efficiency. To address this issue, the Scottish Government conducted a consultation on EPC reform, proposing new metrics, such as a fabric rating. Metrics will not be
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Argyll and Bute Council LHEES Strategy 21 amalgamated; consequently, they will provide a more accurate assessment of the building's energy efficiency. Table 5: Summary of relevant national policies Name Description Targets/Aims Climate Change Climate Change (Emissions Reduction Targets) (Scotland) Act 2019 Targets to reduce Scotland’s emissions of all GHGs to net- zero. 2045: Net zero GHG emissions 2040: 90% reduction 2020: 56%8 Update to the Climate Change Plan 2018–2032 Sets out a pathway to deliver Scotland’s climate change targets, including ambitions for Scotland’s buildings. Multiple targets, includingat least 50% of buildings heated using zero emission systems by 2030 Housing Heat in Buildings Strategy 2021 Sets out a pathway to reduce emissions from buildings and to remove poor energy performance as a driver for fuel poverty. By 2030, majority of buildings should achieve EPC band C, and 1 million homes use zero emission heating Heat in Buildings Bill (currently at consultation stage) Proposed new laws around minimum energy efficiency standards and prohibiting direct emissions heating systems, excluding biomass. Minimum energy efficiency standards to be met by: 2028 for Private landlords 2033 for owner-occupiers Social Housing Net Zero Standard Proposed new energy efficiency standard that replaces EESSH2. Sets a minimum fabric efficiency rating for each home rented by social landlords. Consultation is now closed. 2033: Fabric energy efficiency rating 2045: Clean heating in all socially rented homes Housing to 2040 Sets out the vision and route map for housing in Scotland to 2040. Existing homes are adapted and retrofitted to improve their energy efficiency and decarbonise their heating Energy Heat Networks (Scotland) Act 2021 Requires local authorities to review whether one or more heat network in the local authority is suitable for construction. Achieve a combined supply of thermal energy by heat networks of: 2030: 6 TWh 2027: 2.6 TWh 8 The Climate Change Committee highlighted in March 2024 that these interim targets were unreachable. The Scottish Government are expected to amend or remove these interim targets in the Climate Change Act later in 2045 whilst still maintaining the end goal of reaching net zero by 2045. (BBC News, 2024 - https://www.bbc.co.uk/news/articles/ce9941nzq4yo)
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Argyll and Bute Council LHEES Strategy 22 Heat Networks elivery Plan Sets out how provisions of the Heat Networks (Scotland) Act 2021 will contribute to increasing heat networks in Scotland. The targets set out in the Heat Networks (Scotland) Act 2021. Fuel Poverty Fuel Poverty (Scotland) Act 2019 efines fuel poverty and requires the creation of strategies to tackle fuel poverty. 2040: < 5% of households in fuel poverty, < 1% in extreme fuel poverty. National Planning Framework 4 Sets out Scotland’s spatial principles, regional priorities, national developments, and national planning policy. Multiple 2.2. Local policies Argyll and Bute Council has several policies and strategies relevant to the LHEES. These cover topics such as climate change, energy efficiency, fuel poverty decarbonisation, and land use planning. The following table lists the most relevant policies (Table 6). Table 6: Summary of relevant local policies and strategies Name Description Argyll and Bute Council ecarbonisation Plan (2022- 2025) The Council’s ecarbonisation Plan outlines its journey to reduce carbon emissions. It includes a commitment to develop a roadmap to achieve net zero emissions for Council services, buildings, and assets. IT also includes a commitment to consume less energy and be more efficient with heating oil, gas and electricity in schools, offices, and other buildings. The plan also features a ecarbonisation Tracker which monitors progress in replacing fossil fuel energy sources with low or zero carbon heating sources. Argyll and Bute Outcomes mprovement Plan (2024 – 2034) The ABO P sets out the key challenges the area faces. This includes its remote and rural geography, with many communities living in economically fragile areas, the area's reducing and ageing population, the need to improve the authorities' critical economic infrastructure, tackling deprivation and health inequalities, and unlocking the area's full economic and employment potential.
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Argyll and Bute Council LHEES Strategy 23 The new 10-year Outcome mprovement Plan has three outcomes. Outcome 2 focuses on ensuring everyone in the local authority has access to warm homes. Local evelopment Plan 2 (2024) Adopted in February 2024, the plan provides the local planning framework for the Council area. The L P vision states, “Argyll and Bute is an economically diverse and successful area based on sustainable and low-carbon development….” The plan includes policies that encourage energy efficiency and the development of heat networks where viable. Section 5 of the L P2 outlines a range of policies for diverse and sustainable economies. These policies recognise the unique characteristics of places within Argyll and Bute and the unsuitability of off-the-peg approaches for these communities. Local Housing Strategy (2022-2027) The Local Housing Strategy outlines the Council’s priorities in relation to housing over a five-year period. The second of the four LHS pillars is “energy efficiency, climate change and poverty”. This pillar seeks to take action to improve energy efficiency and increase the decarbonisation of the fuel source. The pillar also outlines the actions required to be taken to address fuel poverty. Argyll and Bute Anti-Poverty Strategy 2018-2022 The council’s vision is for an Argyll and Bute where no-one lives in poverty. Everyone should be able to achieve their potential and feel healthy, happy and valued. “We want to be a place where everyone understands that tackling poverty is everyone’s responsibility. We believe that if we act locally and in partnership, we can make a real difference.” This strategy is based on four key objectives: • To listen to people and families experiencing poverty and make sure their voice is heard. • To support people experiencing poverty to move from dependence to independence. • To ensure our information and services are easy to access. • To provide services that meet the needs of people experiencing poverty.
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Argyll and Bute Council LHEES Strategy 24 Argyll and Bute Child Poverty Action Plan Review 2022-2023 The plan outlines the role that housing condition, poor energy efficiency, and high energy demand play in perpetuating child poverty. t also outlines the detrimental impacts of living in a cold, damp home on child health and development. The plan outlines a series of actions to help alleviate energy-related child poverty. Economic evelopment Plan (2019- 2023) The Smarter Growth – ‘doing more that works’ pillar outlines how the area plans to develop and capitalise on its low carbon economy by generating and using energy locally as a mechanism to decarbonise and tackle fuel poverty. The plan outlines the need to modernise and have greater flexibility in energy distribution. The strategy pledges to work with the council's partners through Argyll and Bute Renewables Alliance (ABRA). It will focus on tackling strategic issues that currently limit the area's potential to generate, distribute, allow local people to take up employment opportunities and make the best use of clean energy. This work will be informed by Argyll and Bute’s Renewable Energy Action Plan (REAP). Economic evelopment Strategy (2024-2034) The Council's new economic development strategy recognises that Argyll and Bute is particularly well placed to benefit from the potential of the area’s natural capital resources and its role in providing green jobs and achieving net zero across key industries. The strategy was approved by committee on March 21st, 2024. t has four strategic pillars. Actions required to reach Net zero is evident in three of the four pillars. Pillar 1: People – Supporting job opportunities in energy and new industries such as the green economy. Pillar 3: Planet - Delivering net zero and improving our biodiversity by supporting the sustainable growth of clean energy production (i.e. hydro, solar, wind and biomass). Pillar 4: Prosperity - seizing opportunities in the net-zero economy and promoting blue and green economies. Scheme of Assistance The scheme sets out how the council will support eligible households in improving their property condition. This fabric- first approach is key to effective decarbonisation.
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Argyll and Bute Council LHEES Strategy 25 Strategic Housing nvestment Plan (2024/25 – 2028/29) dentifies priority housing projects to support the delivery of local and national strategic housing targets, as well as helping to increase the housing supply across other tenures as appropriate. One strand of the SH P outlines the need to meet energy efficiency standards to support households with unprecedentedly high energy costs. 2.3. Progress to net zero in Argyll and Bute The Council recognises climate change as one of the biggest threats to communities. Consequently, the Council has made a clear commitment to be a net zero organisation by 2045. The LHEES will build on work already occurring within Argyll and Bute to reduce emissions. This section provides an overview of some activities that will help Argyll and Bute achieve net zero. 2.3.1. Plans and strategies Argyll and Bute Council Decarbonisation Plan Over the last five years, Argyll and Bute Council has successfully reduced its carbon emissions by 27%. The Council is committed to investing £1.2 million to reduce carbon emissions further. The Decarbonisation Action Plan Tracker details the actions planned to realise this ambition. The plan is shared publicly on the Council’s Climate Change webpages, and progress against the tracker is reported to the Policy and Resources Committee. Net Zero Route Map Work is underway to build on the Decarbonisation Plan by developing a Net Zero Route map to provide further details on the journey to net zero. Community Planning Partnership The Community Planning Partnership has recently appointed a Climate Change Action Project Manager who is responsible for leading on delivery of a new regional Argyll and Bute Climate Action Plan. This plan will work in conjunction with the LHEES to reduce heat demand. Carbon Neutral Islands The Scottish Government Carbon Neutral Islands project aims to support six islands to become carbon neutral by 2040. The six islands participating in the programme are Islay, Barra, Great Cumbrae, Hoy, Raasay and Yell. Each island has completed carbon audits, developed community climate change action plans and investment strategies, and identified learning and good practice that can be shared with other Scottish islands. Argyll and Bute Council sits on the newly formed Local Authority Advisory Group to support the implementation of the Carbon Neutral Island project, ensuring alignment and coordination with wider Local Authority activity and reciprocal sharing of information.
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Argyll and Bute Council LHEES Strategy 26 2.3.2. Education and Training The Argyll and the Isles Countryside Trust (ACT) is a key partner in progressing towards net zero. ACTNow has provided Carbon Literacy Training and support to help the Council achieve organisation-wide Carbon Literacy Bronze Standard Accreditation. A carbon-literate citizen understands the impact of climate change on themselves and others. They have the knowledge and skills to reduce their and others' carbon footprint. Accrediting Elected Members and Officials enables them to consider the carbon implications when making decisions. Figure 3 shows that this significantly impacts reducing global temperatures more than developing pledges and targets. Figure 3: Climate Action Tracker warming projections – Global temperature increase by 2100. Source: Climate Action Tracker (2023). Image copyright: Climate Analytics and NewClimate Institute, reproduced by Argyll & Bute Council. 2.3.3. Decarbonising buildings Argyll and Bute Council Non-Domestic Energy Efficiency Projects Carbon emissions associated with the Argyll and Bute Council’s estate and buildings account for over 20% of the Council’s overall carbon footprint. n 2021, Argyll and Bute Council identified 50 individual energy efficiency projects for its non-domestic buildings, including schools, offices, and leisure centres. By May 2024, 49 out of 50 of these energy efficiency projects had been delivered, with an annual carbon saving of 357 tonnes.
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Argyll and Bute Council LHEES Strategy 27 Area Based Schemes (EES:ABS) ABS is a Scottish Government grant funding scheme for local authorities to offer installation of energy efficiency measures to homes in areas of low income and fuel poverty. As a non-stock owning Council, Argyll and Bute’s programme differs to that of other local authorities by inviting applications from throughout the entire Argyll and Bute area - with geography being no barrier to be able to take advantage of the Scheme. The Scheme has been delivered in Argyll and Bute since 2013, and £21,134,881.31 has been spent on measures since inception to July 2023. The Scheme is available to eligible private owners and private rented tenants in Argyll and Bute. It takes a fabric-first approach, installing the most suitable type of insulation for the property, helping to reduce harmful carbon emissions and, in turn, reduce fuel costs. To the end of the Project Year in June 2023, the Council spent all its 2022/23 budget allocation of £2,011,323, plus an additional £300,000, which was approved by the Scottish Government to meet the demands of an increased number of applications. In this programme period, 281 homes were insulated. The programme year for 2023/24 ends in June 2024, and the budget of £1,979,827 is predicted to be spent in full. The Council hopes the Scottish Government will award similar amounts to continue the programme in 2024/25. Warmer Homes Scotland Starting in 2022, Argyll & Bute Council and ACHA worked together on a programme of applying external wall insulation on mixed tenure blocks of properties in Tarbert, Bute and Cowal. Utilising a Special Project EES:ABS grant of £984,400 from the Scottish Government the programme was able to support eligible private owners and privately rented properties within the blocks, with ACHA utilising Warmer Homes Scotland funding for their stock. Energy Company Obligation (ECO) ECO was first introduced in 2013 and legally obliges energy suppliers in the UK to deliver energy efficiency measures to low-income and fuel-poor domestic premises. It is in its 4th iteration. It is designed to tackle fuel poverty and help reduce carbon emissions. Between October and December 2023, 18,455 measures were installed through ECO4 in the local authority area. Local authorities are invited to set expanded qualifying criteria for households in their area to access ECO4Flex Funding, which considers the unique qualities of specific areas. Argyll and Bute Council have published their Statement of Intent, setting out eligibility criteria for April 2022 to March 2025. Achieving standards for social housing Argyll and Bute Council is one of the few councils that transferred all its housing stock and consequently has no direct control over social housing. However, the Council continues to work in partnership with housing associations to improve energy efficiency in line with the targets and standards set by the Scottish Government. For example, the warmer homes project. Previously, these standards have been set through the Energy Efficiency Standard for Social Housing (EESSH) and EESSH2 (see Section 2.1). Argyll and Bute Registered Social Landlords
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Argyll and Bute Council LHEES Strategy 28 were on track to meet full compliance with EESSH2 targets by 2032. In November 2023, the Scottish Government launched a consultation on a new Social Housing Net Zero Standard, which will replace EESSH2. The proposed new standard includes setting a minimum fabric efficiency rating (different to the current EPC rating) and introducing a requirement to replace polluting heating systems with clean alternatives by 2045. Argyll and Bute Council will continue to work jointly with the Housing Associations, at their request, to meet these standards. Campbeltown wastewater to heats Aqualibrium leisure centre In 2018, a joint venture between Argyll and Bute Council, Scottish Water Horizons and SHARC Energy Systems enabled Campbeltown’s Aqualibrium leisure centre to be heated by wastewater from the Kinloch Park Pumping Station. The heat-from-wastewater technology was one of the first of its kind and was funded by the Scottish Water Horizons and the Scottish Government’s Low Carbon Infrastructure Transition Programme (LCITP). Home Energy Scotland Home Energy Scotland is a key partner for the Council in delivering EES:ABS, energy efficiency advice, and funding checks for residents. During 2022/23, Home Energy Scotland interacted with 4,266 households, compared to 3,268 in the same period the previous year, an increase of 31%. Strategic Housing Investment Programme Heat Network Infrastructure The Council has developed a Strategic Housing nvestment Plan that identifies priority housing projects to support the delivery of both local and national strategic housing targets, as well as help to increase the supply of housing across other tenures as appropriate. The Council will investigate the possibility of installing infrastructure for shared ground loops and heat networks when infrastructure is being installed for new homes. For example, a proposed housing project in Lochgilphead is located near a potential heat network area. Implementing shared infrastructure can help overcome the challenge of high infrastructure costs and increases the likelihood of developing the network. ALIenergy ALIenergy works across Argyll and Bute to promote sustainable energy use and renewable energy generation, to address fuel poverty and reduce carbon emissions. During 2022/23, they received 1,246 enquiries, delivered 2,858 advice sessions, and made 1,130 referrals to partners and/or funds. The Affordable Warmth Team secured £180,582 in client gains from crisis intervention support through energy vouchers, alleviation of fuel debt and help with energy bills. 2.3.4. Examples of renewable energy generation (not an exhaustive list) Argyll and Bute is well placed to significantly contribute to Scotland and the UK’s Net Zero ambitions. In 2023, Argyll and Bute produced over 1.5 Gigawatts of clean energy, approximately 10% of the Scottish annual total. This energy largely feeds into the national grid with limited
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Argyll and Bute Council LHEES Strategy 29 benefits to the local area except for the local distribution of the community benefit funds. The local grid is currently constrained, and there is a need to modernise it to enable greater flexibility in addressing local energy issues. It is important to note that the renewable energy generation projects listed below are not an exhaustive list but provide some examples of renewable energy generation in Argyll and Bute. ABRA The Council will continue to work with its partners through the Argyll and Bute Renewables Alliance (ABRA), focusing on tackling strategic issues that currently limit the potential to generate and distribute clean energy, allow local people to take up employment opportunities, and make the best use of clean energy in their communities. Local Energy Scotland Local Energy Scotland supports communities across Scotland to engage with, participate in and benefit from the energy transition to net zero. Through the Community and Renewable Energy Scheme (CARES), Local Energy Scotland offers a range of financial support and advice to community groups to get local energy projects up and running. Local energy generation and distribution The LHEES delivery plan will set out as series of actions for the Council and its partners to assess the viability of developing local energy generation and distribution projects. These projects aim to provide clean and affordable energy to local communities facing challenges in accessing clean and affordable energy due to grid constraints. Tiree Community Develop Trust -TREL (Tiree Renewable Energy Limited) In 2022, the Tiree Community Develop Trust (TREL) produced 2,013,645kWh. This is enough electricity to supply 540 average UK homes for an entire year. Iona Renewables Community-led organisation Iona Renewables has commissioned consultants to draw up plans to develop a heat network to supply heat to 36 households in Iona village, as well as to Iona Abbey which is owned by Historic Environment Scotland. If funding can be found it will use a ground source heat pump, powered by a 100KW wind turbine. The heat network will cut carbon emissions by an estimated 240 tonnes of CO2 annually. Argyll and Bute Rural Growth Deal- Creating a Low Carbon Economy for Islay Argyll and Bute Rural Growth Deal (RGD) is an agreement between the Scottish Government, the UK Government and Argyll and Bute Council to bring about long-term strategic approaches to improving the regional economy. In October 2019, the Scottish and UK governments committed to investing up to £25 million in the Argyll and Bute Rural Growth Deal. The RGD comprises of
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Argyll and Bute Council LHEES Strategy 30 several projects including ‘Creating a Low Carbon Economy for slay’ project. The proposed project seeks to support the creation of local energy systems, in collaboration with the Scottish Government Carbon Neutral Islands project, to support the development of a pathway to net zero emissions. A business case for Islay Energy System was generated but was not approved by both governments. The project team is considering alternative project options. The Mull and Iona Community Trust’s AMAZE project The Mull and Iona Community Trust is an organisation focused on improving the quality of life for the residents of Mull and Iona, addressing problems of geographic isolation and economic and social exclusion in remote and rural communities. The AMAZE project is a collaborative project between the trust and residents who want to limit fossil fuel use on the islands. They received funding to work with a consultant to develop a local energy plan, to help transform the islands into a “zero emissions, energy secure, self-reliant, and thriving place with efficient homes…driven by a local community ethos”9. The project has concluded the research phase and is seeking funds to recruit project staff to develop and deliver the work. Proposals include examining the feasibility of heat networks on the islands and working with public and private property owners to decarbonise. 2.3.5 Heat network development According to the Heat Networks (Scotland) Act 2021, heat networks encompass both district and communal heating. Argyll and Bute has district heating systems, such as the Dunbeg district heating system, operated by West Highland Housing Association. This scheme uses biomass to provide heat to social housing. The authority also has examples of operational heat networks such as the heat network in Campbeltown that uses wastewater. The Council and its stakeholders have conducted several research projects to assess the feasibility of heat networks, such as the Iona Heat Network, the AMAZE heat networks, and the RGD and Carbon Neutral Islands project in Isay. RSLs have also assessed the feasibility of district heating systems to heat social housing stock. As part of the LHEES process, the Council has collaborated with Zero Waste Scotland and Buro Happold to identify potential sites for shared ground loops and commissioned Changeworks to identify potential Heat Networks based on the methodology outlined by the Scottish Government. 9 The Mull and Iona Community Trust (2024) The AMAZE Project: Working towards a zero emissions and secure energy future of our islands URL: https://www.mict.co.uk/projects-services/amaze-project/. (Accessed: 02/04/2024).
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Argyll and Bute Council LHEES Strategy 31 3. Stakeholder Engagement The Council has acknowledged the importance of engagement. The LHEES Officer has devoted time to cultivating relationships with stakeholders and involving them in identifying priorities and the actions required to address them. Stakeholder engagement has played a key role in informing the evidence base and analysis at all stages of the LHEES. The Council hosted two LHEES stakeholder engagement events and has also engaged with stakeholders in other ways as detailed below. 3.1. Engagement with external stakeholders The following table outlines the stakeholder engagement work undertaken to date (Table 7). Table 7: Summary of engagement and involved projects across all high priority stakeholders Category Stakeholder and Interest Engagement Activity Challenges Housing Providers Argyll Community Housing Association Priority interest: Desire to improve energy efficiency measures in their housing stock and implementing heat network zones. • LHEES Stakeholder Workshops • HOMEArgyll Partnership • A&B Energy Efficiency Forum • ACHA Warmer Homes Project • A&B Strategic Housing Forum • A&B SHIP Group Large proportion of stock in conservation areas or listed buildings. Low density of A&B makes suitability difficult for Heat Network Zones. High proportion of stock near coastlines puts them more at risk from exposed weather, making them hard to heat and treat. Supply chain issues make installing energy efficiency measures challenging and expensive Fyne Homes Priority interest: Heat Network Zones, having already developed three heat networks in the area. • LHEES Stakeholder Workshop • HOMEArgyll Partnership • A&B Energy Efficiency Forum • A&B Strategic Housing Forum • A&B SHIP Group 1,600 housing units in conservation areas making work challenging and expensive. High proportion of stock near coastlines puts them more at risk from exposed weather, making them hard to heat and treat. Supply chain issues make installing energy efficiency measures timely and expensive.
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Argyll and Bute Council LHEES Strategy 32 Dunbritton Housing Association Priority interest: Improving the energy efficiency measures in their housing stock • LHEES Stakeholder Workshops • HOMEArgyll Partnership • A&B Energy Efficiency Forum • A&B Strategic Housing Forum • A&B SHIP Group Large proportion of stock in conservation areas or listed buildings. Low density of A&B makes suitability difficult for Heat Network Zones. High proportion of stock near coastlines puts them more at risk from exposed weather, making them hard to heat and treat. Supply chain issues make installing energy efficiency measures timely and expensive Link Housing Priority interest: Desire to develop a heat network in Oban • LHEES Stakeholder Workshops • A&B Energy Efficiency Forum • A&B Strategic Housing Forum • A&B SHIP Group Large proportion of stock in conservation areas or listed buildings. Low density of A&B makes suitability difficult for Heat Network Zones. High proportion of stock near coastlines puts them more at risk from exposed weather, making them hard to heat and treat. Supply chain issues make installing energy efficiency measures timely and expensive. West Highlands Housing Association Priority interest: improving the energy efficiency measures in their housing stock • LHEES Stakeholder Workshops • HOMEArgyll Partnership • A&B Energy Efficiency Forum • A&B Strategic Housing Forum • A&B SHIP Group Large proportion of stock in conservation areas or listed buildings. Low density of A&B makes suitability difficult for Heat Network Zones. High proportion of stock near coastlines puts them more at risk from exposed weather, making them hard to heat and treat. Supply chain issues make installing energy efficiency measures timely and expensive. Organisations with energy remit Community Planning Partnership • LHEES Stakeholder workshop • Climate Change Board The CPP has only recently appointed a Climate Change Action Project Manager so the process to develop a Regional Climate Action Plan has only just commenced.
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Argyll and Bute Council LHEES Strategy 33 Local Energy Scotland • LHEES Stakeholder workshop LES supports communities to generate their own energy and develop heat networks. Project development is often halted by funding or community organisations capacity to take projects forward. Distribution System Operators Scottish & Southern Electricity Networks Priority interest: ensuring grid maintains capacity and is not overburdened in specific areas • LHEES Officer participated in a wide range of SSEN Stakeholder events, stakeholder surveys and stakeholder returns. • One to one meetings with various teams and most recently the Whole System Team to ensure they are aware of the issues with implementing LHEES priorities and discussing potential solutions. • Working with SSEN to share data and project priorities using the Lenza tool Current grid constraints across Argyll and Bute have prevented the progress of large-scale retrofitting for electric heating in several areas. Argyll and Bute Council are unusual, with two DSO covering the council’s boundaries. This means more engagement and liaison. What is most challenging is both DSOs have different data sharing platforms, which requires the council to collect and provide data differently. Scottish Power Energy Networks Priority interest: ensuring grid maintains capacity and is not overburdened in specific areas • LHEES Officer participate in a wide range of SPEN Stakeholder events, stakeholder surveys, and stakeholder returns. • In discussions with SPEN regarding data sharing mechanisms Current grid constraints across the Helensburgh area have prevented the progress of large-scale retrofitting for electric heating in several locations. Argyll and Bute Council are unusual, with two SO covering the council’s boundaries. This means more engagement and liaison. What is most challenging is both DSOs have different data sharing platforms, which requires the council to collect and provide data differently. Argyll and Bute Energy Efficiency Forum The Argyll and Bute Energy Efficiency Forum is a key group with which to engage. The LHEES Officer is a member of the Forum. Other members include: • Islay Energy Saving Trust • Argyll and Bute Citizens Advice Bureau • ALIenergy • Argyll and Bute Council Leader
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Argyll and Bute Council LHEES Strategy 34 • Home Energy Scotland • Local Energy Scotland • Argyll and Bute Area Based Team • Dunbritton Housing Association • West Highland Housing Association • ACHA • Fyne Homes 3.2. Engagement with internal stakeholders In the early stages of the LHEES development, the Council set up an LHEES Steering Group with representation from relevant services. The steering group provided input and reviewed the LHEES's outputs. Table 8 shows the various internal teams within the Council which have participated in the LHEES process. Table 8: Summary of engagement and challenges across Argyll and Bute Council departments Department Stakeholder(s) Engagement Challenges Housing Strategy Housing Strategy Team Considered the viability of using new build housing projects outlined in the Strategic Housing Investment Plan (SHIP), to lay infrastructure for heat networks and enable the retrofit of existing housing stock Communication with housing associations to establish HOMEArgyll Partnership to deliver EESSH2/SHNZS The Council does not directly control social housing which limits influence Transition to SHNZS from EESSH2 brings focus to fabric-first Grid capacity prevents upgrades Housing stock on the coast is often difficult to heat and treat Housing -ABS Home Energy Team Experienced in implementing energy efficiency measure projects across Argyll and Bute Administer ABS schemes Co-ordinate the interagency Energy Efficiency Forum Large proportion of buildings with solid walls makes insulating expensive Large proportion of properties hard to heat and hard to treat Supply chain issues combined with the geography of the local area make any retrofitting project timely and costly The Council’s low-wage economy makes it difficult for residents to afford a transfer to an electric clean energy system
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Argyll and Bute Council LHEES Strategy 35 Planning Local Development Plan team Write policies on heat networks and retrofitting in conservation areas. Delivering NPF4 as it has an important role to play in facilitating the rollout of low carbon heat. Limitations on retrofitting housing stock in conservation areas Property and Estates Property Services Team Expertise in non-domestic property management. Responsible for implementing the Council’s ecarbonisation Plan and managing non-domestic heat network/district heating schemes for non-domestic council assets. Public-owned non-domestic building stock only makes up a small percentage of the areas total heat demand annually. Climate Change Officer The Climate Change Officer is secretariat to the Climate Change Board and is leading on the net zero route map. The Climate Change Officers remit is limited to Council assets. This post is also currently vacant. Business Development Rural Growth Team Vital in progressing Argyll and Bute’s Rural Growth eal which aims to implement a project to achieve a low carbon economy in Islay The Scottish and UK government did not agree to the business case developed for a low carbon energy system on Islay. Climate Change Board In addition to consulting with individual Council services the Strategy and Delivery Plan have been shaped by the Climate Change Board, which is a key consultation and engagement vehicle. The board meets every two months and comprises of: • representatives from relevant council services • the Elected Members, who is the Policy Lead for Climate Change • the Community Planning Partnership • ACTNow (a third sector organisation) Elected Members The Policy Lead for Climate Change has been engaged in the LHEES process. Other elected members have received updates on the LHEES every few months through reports to the Policy and Resources Committee. The LHEES consultative draft and final document will be presented to the full council to ensure that all Elected Members have the opportunity to contribute and shape the LHEES documents.
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Argyll and Bute Council LHEES Strategy 36 3.3. Community Engagement The Council will also provide the opportunity for the community and other stakeholders to engage with the LHEES. The Council will actively promote the LHEES Consultative Draft and online consultation process through its communication channels, using social media as well as traditional promotional methods. 3.4. Next Steps The LHEES process is iterative, so stakeholder input will continue to shape the documents, which are intended to be dynamic and adaptable rather than static. Further engagement is crucial to inform the Delivery Plan. The Community Planning Partnership has participated in the LHEES stakeholder events that shaped the LHEES priorities and actions. The Council will continue to work closely with the Community Planning Partnership, which will soon issue a "call for evidence" to organisations and communities to gather better local data and grassroots ideas on decarbonisation and which organisation or community can take these actions forward.
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Argyll and Bute Council LHEES Strategy 37 4. Baselining Building Stock Age, dwelling type, wall construction, tenure, and heating fuel are key factors that impact energy performance, operational costs, and living conditions in buildings. Home Analytics data for Argyll and Bute has been used to benchmark key property statistics against overall national statistics found in the Scottish House Condition Survey, 2021. 4.1. Domestic buildings Property age and construction type for domestic buildings Property age can be used to predict construction type, which is useful when planning appropriate retrofit interventions across many buildings. Properties built before 1919 are likely to be of a solid wall construction, from brick or stone, with timber floor and roof construction. Table 9 depicts the age profile of domestic properties in Argyll and Bute. Table 9: Property ages per property type within Argyll and Bute. Source: Home Analytics v.3.9 Property Type Pre- 1919 1919- 1949 1950- 1983 1984- 1991 1992- 2002 Post- 2002 Total Detached house 5,641 910 5,468 1,067 1,363 2,662 17,111 Semi-detached house 1,157 788 4,334 297 575 832 7,983 Mid-terraced house 621 297 2,367 122 132 277 3,816 Small block of flats/dwelling converted in to flats 3,784 1,011 1,368 238 399 588 7,388 Block of flats 1,456 255 2,050 208 313 407 4,689 End-terraced house 629 251 1,873 104 106 269 3,232 Large block of flats 39 2 262 374 131 337 1,145 Flat in mixed use building 2,403 109 336 124 227 109 3,308 Stone buildings are likely to have a high conservation value and might be within conservation areas or be listed. This can make the path for retrofitting and upgrades much more difficult. Retaining the facing stone in such buildings is often essential to the character of the area; this presents unique retrofit challenges. Cavity wall construction became commonplace from the 1920s onwards and is still built today. Like traditional construction, cavity wall construction commonly uses timber for floor and roof construction. Walls are constructed in two rather than a single leaf. While cavity walls are currently one of the most popular insulation upgrades, cavity wall insulation is generally not suitable for buildings with stone construction as no gap is present for cavity wall insulation. Solid walls must be
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Argyll and Bute Council LHEES Strategy 38 insulated either from the inside or the outside. This will cost more than insulating a standard cavity wall, but the total savings on heating bills will also be higher. Additionally, cavity wall constructed properties are much more likely to incorporate damp proof courses and Portland cement than traditionally constructed properties. More recent cavity wall constructed properties (post-1980) are likely to have partially filled cavities. System-built usually refers to post-war non-traditional construction housing that is not cavity wall constructed. Such housing is normally utilitarian in design and has low conservation value. This is advantageous regarding potential external wall insulation interventions; however, these properties have a range of unique designs making standardised retrofit plans challenging. In Scotland, timber frame construction superseded cavity wall construction as the primary method of housebuilding in the early 1980s. The proliferation of timber frame construction in Scotland has coincided with the incremental increase of insulation standards. Older properties may have minimal mineral wool insulation between timber studs, whereas newer properties may have up to 140mm of phenolic foam or air-tight barriers. Increasing insulation standards have been the main driver in the increase in depth of the timber structure, with older properties having around 75mm timber studs in comparison to 140mm in modern buildings. Figure 4: Property types by age of building in Argyll and Bute Table 10 illustrates the insulation status of residential buildings in Argyll and Bute. Notably, of the total domestic building stock, 32% are uninsulated solid brick or stone. This statistic is particularly significant considering that solid wall buildings are the most common type in the area, and only one 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 Distribution of property ages within property types in Argyll and Bute Pre-1919 1919-1949 1950-1983 1984-1991 1992-2002 Post-2002
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Argyll and Bute Council LHEES Strategy 39 in five of these buildings are insulated. This highlights the considerable challenge of improving insulation levels in the council area. Table 10: Construction types of properties within Argyll and Bute. Source: Home Analytics v.3.9 Cavity Timber Frame Solid brick or stone System built All construction types Insulated Uninsulated Insulated Uninsulated Insulated Uninsulated Insulated Uninsulated Total 10,718 (22%) 5,696 (12%) 6,903 (14%) 4,038 (8%) 3,603 (7%) 15,726 (32%) 1,190 (2%) 798 (2%) 48,672 (100%) Tenure of domestic buildings The type of property tenure directly impacts the pace and extent of retrofit installations in Argyll and Bute. Specific policies targeting public sector housing, such as EESSH/ EESSH2, have proven to accelerate change. The private sector has experienced slower progress as it has not been subject to complying with the same policy requirements. Additionally, property owners investing in insulation and decarbonised heating systems have not seen a strong return on their investment, resulting in lower installation levels in the private sector. Just under a fifth of the domestic properties in Argyll and Bute are social housing (Figure 5). Despite some financial support for these properties, it is challenging for Registered Social Landlords (RSL) to allocate funds for retrofit works, to comply with energy efficiency requirements, while simultaneously maintaining affordable rents. The majority of properties in the local authority area are owner-occupied (68%), and 15% are privately rented (Table 11). Consequently, if the authority is to meet its net zero ambitions, it must develop a retrofit strategy for privately owned properties. Table 11: Tenure split of properties within Argyll and Bute. Source: Home Analytics v.3.9 Owner Occupied Local Authority Privately Rented Housing Association 33,209 (68%) 0 (0%) 7,087 (15%) 8,372 (17%)
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Argyll and Bute Council LHEES Strategy 40 Figure 5: Pie chart of property tenure split within Argyll and Bute Mixed-tenure properties provide an additional retrofit challenge due to having multiple owners within the same building. Just under a fifth of properties in Argyll and Bute are mixed-tenure (Table 12). These owners have different priorities or capital investment plans, and this can delay or reduce the extent of any retrofit. However, less than a fifth of the total housing stock in Argyll and Bute is located in a mixed-tenure building. Table 12: Mixed tenure and single tenure properties split in Argyll and Bute. Source: Home Analytics v.3.9 Tenure Type Single tenure Mixed tenure 41,119 (84%) 7,553 (16%) 33209 68% 7087 15% 8372 17% Tenure split of properties within Argyll and Bute Owner Occupied Privately Rented Social Rented
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Argyll and Bute Council LHEES Strategy 41 Figure 6: Pie chart of mixed tenure split within properties in Argyll and Bute Fuel poverty Data from the Scottish House Condition Survey and the Scottish Index for Multiple Deprivation (SIMD) have been used to assess fuel poverty within Argyll and Bute. 41119 84% 7553 16% Split of mixed tenure properties in Argyll and Bute No Yes Box 1: Scottish House Condition Survey: Fuel Poverty Data In this dataset, a household is classified as fuel poor if, in order to maintain a satisfactory heating regime, total fuel costs necessary for the home are more than 10% of the household’s adjusted net income (after housing costs), and if after deducting fuel costs, benefits received for a care need or disability and childcare costs, the household’s remaining adjusted net income is insufficient to maintain an acceptable standard of living. The most recent local authority estimates of fuel poverty are from 2017-19. This is because data was not collected in 2020, and there were changes to the way data was collected in 2021.
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Argyll and Bute Council LHEES Strategy 42 Argyll and Bute had one of the highest rates of fuel poverty in Scotland (32%), according to the 2017-19 Scottish House Condition Survey.10 The gap between Argyll and Bute’s fuel poverty rate and national average has historically fluctuated but has always been higher than the national average (Figure 7). While this trend provides an overall historical insight, the definition of fuel poverty changed in 20194, meaning direct comparisons cannot be drawn with the statistics published prior to 2016-2018. Nonetheless, the figures highlight ongoing significant challenges within Argyll and Bute where a balance is required between reducing fuel poverty and avoiding driving an off-gas grid majority population into further fuel poverty. Table 13: Scottish House Condition Survey figures showing the three-year average fuel poverty rates across Argyll and Bute and Scotland. Source: Scottish House Condition Survey 2013-22 Households 2013-15 2014-16 2015-17 2016-18 2017-19 2019-22 Argyll and Bute 16% 45% 44% 29% 32% data unavailable Scotland 9% 34% 27% 25% 24% 31% Figure 7: Three-year average fuel poverty rate across Argyll and Bute relative to the Scottish national. Note that from the years 2016-18 onwards, the definition of fuel poverty differed to the previous years. 10 Scottish Government (2021) Scottish House Condition Survey: Local Authority Analysis 2017-2019, 23 February. Available at: https://www.gov.scot/publications/scottish-house-condition-survey-local-authority- analysis-2017-2019/pages/6/ (Accessed: 02/04/2024). 16% 45% 44% 29% 32% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% 2013-15 2014-16 2015-17 2016-18 2017-19 Comparison of three-year average fuel poverty rates across Argyll and Bute and Scotland Argyll and Bute Scotland
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Argyll and Bute Council LHEES Strategy 43 Fuel poverty is a function of several variables including income and how energy is used in the home, neither of which have been analysed as part of the LHEES. Fuel poverty is also driven by the energy efficiency of homes and by fuel prices. While the average fuel poverty rate in Argyll and Bute stands at 32%11, there are areas with much higher concentrations of fuel poverty, as demonstrated in Map 1. Forty three percent of Argyll and Bute’s population live in areas classified as ‘remote rural’; and 4.2% live in areas classified as ‘accessible rural’. Rural populations are potentially at greater risk of fuel poverty.12 The rate of fuel poverty is likely to have worsened since 2019 due to the recent cost- of-living crisis and energy price crisis. Map 1: Probability of fuel poverty across Argyll and Bute.13 11 Scottish Government (2019) Scottish House Condition Survey: Local Authority Analyses 2010-2012 to 2016-2018. Available at: Scottish House Condition Survey: Local Authority Analyses 2010-2012 to 2016- 2018 - gov.scot (www.gov.scot) (Accessed: 02/04/2024). 12 Changeworks (2022) A perfect storm: Fuel poverty in rural Scotland 13 Map 1 is only an indication of the number of properties at risk of fuel poverty as a result of poor building energy efficiency. It does not account for the other variables that are drivers of fuel poverty (household income, energy bills and how energy is used in the home). This, however, does not mean that poor building energy efficiency alone should be used as the sole indicator of fuel poverty risk, as it may highlight affluent areas with poor building energy efficiency.
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Argyll and Bute Council LHEES Strategy 44 In a national context, Argyll and Bute is a lesser deprived area (ranked 18th of 32 local authorities), based on SIMD rankings. A total of 4,992 properties in Argyll and Bute fall within SIMD deciles one and two (see Box 2). Only 4% of Argyll and Bute’s social housing and 4% of owner-occupied properties fall within these two deciles of high deprivation (Table 14). The Council has used the LHEES process to investigate where these areas with a high probability of multiple deprivation also have a high number of category one ‘heat pump ready’ properties. Table 14: SIMD statistics covering Deciles One and Two by tenure within the local authority’s total domestic building stock. Source: Home Analytics v.3.9 Owner Occupied Privately Rented Housing Association 2,074 (4%) 881 (2%) 2,037 (4%) Box 2: Scottish Index for Multiple Deprivation as a proxy for fuel poverty The Scottish Index for Multiple Deprivation (SIMD) dataset has been used to assess fuel poverty within Argyll and Bute. SIMD is a standard tool for identifying areas with relatively high levels of deprivation and was published in 20201. The SIMD: • Is a relative measure of deprivation across small areas in Scotland. • Looks at multiple deprivation. 'Deprived' does not just mean 'poor' or 'low income'. It can also mean people have fewer resources and opportunities, for example in health and education. SIMD data can be used to: • Compare overall deprivation of small areas. • Compare the seven domains of deprivation. • Compare the proportion of small areas in a Council region that are very deprived. • Find areas where many people experience multiple deprivation. • Find areas of greater need for support and intervention. SIMD data is split into ten deciles covering the whole population, where one is most deprived and ten is least on the scale.
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Argyll and Bute Council LHEES Strategy 45 Figure 8: Tenure split amongst SIMD Decile One and Two Properties within Argyll and Bute Primary fuel type for domestic buildings In Argyll and Bute the use of electricity as the primary fuel type in domestic buildings is around three times the national average (Table 15). Although gas is the most common fuel type, the number of homes using gas is approximately half of the national average. In some areas, such as Oban, it is not mains gas but rather “town gas”; gas delivered to the town and then filled into tanks, from which it is piped to individual residences. Biomass or solid fuel (wood or coal) is six times more prevalent as the primary heating source than in Scotland as a whole (Table 15). This figure is likely to be higher, as many households may have another fuel as their main heating source, but they often do not use that heating at all or only at certain times of the year due to the cost. Instead, many households heat a room or two using a wood-burning stove or open fire as the wood fuel is often free. Housing Association 2,037 4% Owner Occupied 2,074 4% Privately Rented 881 2% Other SIMD Category Properties 43,680 90% Tenure split of properties within SIMD Deciles One and Two within Argyll and Bute Housing Association Owner Occupied Privately Rented Other SIMD Category Properties
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Argyll and Bute Council LHEES Strategy 46 Table 15: Primary fuel type statistics for domestic properties in Argyll and Bute. Source: Home Analytics v.3.9 Primary Fuel Type Argyll and Bute Scotland Mains Gas (including Town Gas) 20,211 (42%) 2,016,000 (82%) Electricity 16,270 (33%) 262,000 (11%) Oil 7,211 (15%) 129,000 (5%) LPG 1,753 (4%) 18,000 (1%) Biomass/Solid Fuel 2,871 (6%) 36,000 (1%) No Fuel 356 (1%) - Figure 9: Primary fuel types across properties in Argyll and Bute relative to the Scottish national average. Energy Performance Certificate data for domestic buildings Social housing generally has much better energy efficiency than the other property tenures. In Argyll and Bute 8% of social housing is rated EPC band A-B compared to the national average of 6% (Table 16), suggesting a strong programme of existing retrofitting works have taken place in this tenure type in Argyll and Bute. 1 10 100 1000 10000 100000 1000000 10000000 Electricity LPG Mains Gas Oil Biomass/Solid Fuel Primary Fuel Type in Argyll and Bute and Scotland Argyll and Bute Scotland
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Argyll and Bute Council LHEES Strategy 47 Table 16 shows that 21% of privately rented and 18% of owner-occupier properties have an EPC band C. This is approximately half as many than the national average of 43% for both tenures. More work is required to encourage landlords to improve energy efficiency measures. Table 16: EPC data for domestic properties in Argyll and Bute. Source: Home Analytics v.3.9 EPC Band Owner Occupied Private Rental Social Housing Argyll and Bute Scotland Argyll and Bute Scotland Argyll and Bute Scotland A-B (81-100) 6% 4% 6% 7% 8% 6% C (69-80) 18% 43% 21% 43% 53% 59% D (55-68) 36% 38% 32% 35% 29% 28% E (39-54) 23% 11% 21% 9% 7% 6% F-G (1-38) 17% 4% 20% 6% 2% 1% All 100% 100% 100% 100% 100% 100%
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Argyll and Bute Council LHEES Strategy 48 Figure 10: Split of EPC bands across all property tenures in Argyll and Bute relative to the Scottish national average. Carbon emissions from domestic buildings It is noteworthy that all dwelling types in Argyll and Bute have lower carbon emissions than the national average. Carbon emissions are relatively consistent across the different dwelling types in Scotland as a whole, ranging from 67.4 kg/m²/yr to 70.5 kg/m²/yr. n contrast, Argyll and Bute’s tenements and detached housing have lower emissions than other housing types in Argyll and Bute. When compared to the national average this equates to approximately 18% and 15% lower carbon emissions per m², respectively. 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% A-B (81-100) C (69-80) D (55-68) E (39-54) F-G (1-38) EPC Data for Domestic Properties in Argyll and Bute Relative to National Figures Owner Occupied Social Housing Private Rental Private Rental (Scotland) Owner Occupied (Scotland) Social Housing (Scotland)
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Argyll and Bute Council LHEES Strategy 49 Figure 11: Carbon emissions (kg/m²/yr) for each dwelling type in Argyll and Bute. Source: Home Analytics v.3.9 4.2. Non-domestic buildings Non-domestic buildings make up only 17% of the total building stock in Argyll and Bute. Within non-domestic buildings, the majority (90%) are privately owned; this is 7% more than observed within the total domestic building stock (Figure 12). This means that significant partnership working will be required with the owners of non-domestic buildings if these buildings are to be decarbonised. 63.3 67.0 59.9 63.5 55.4 60.3 70.4 68.2 70.5 69.8 67.4 69.3 0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 Carbon Emissions (kg/sqm/yr) Argyll & Bute CO2 emissions estimate (kg/msq/yr) National CO2 emissions estimate (kg/msq/yr)
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Argyll and Bute Council LHEES Strategy 50 Figure 12: Breakdown of privately owned and public owned non-domestic building stock in Argyll and Bute Non-domestic buildings in Argyll and Bute require significantly less heat than domestic properties, equating to only 38% of the total heat demand across all properties (Table 17). Table 17: Total heat demand for domestic and non-domestic buildings in Argyll and Bute. Source: Non-Domestic Analytics v.1.1 Non-domestic total heat demand (MWh/yr) Domestic total heat demand (MWh/yr) Total heat demand (MWh/yr) 488,583 (38%) 806,891(62%) 1,295,474 Figure 13 demonstrates that the correlation between the number of properties and heat demand is not always directly proportional and depends on the property’s end use. Non-domestic typologies such as residential properties, including care homes, sheltered housing and short-term/holiday lets, are most common within Argyll and Bute, with proportionally high heat demand. Storage facilities and offices constitute the next greatest frequencies of non-domestic stock within Argyll and Bute, yet heat demand is significantly lower. Although hotels make up a relatively low number of properties, they have high heat demands. Hotels are often of stone construction and located on the seafront. Consequently, they are exposed to the elements, which probably accounts in part for their high heat demand. In addition, hotels have high-intensity heating to maintain continuous temperature control. 10% 933 17% 8,374 90% 8,691 83% 40,298 0 10,000 20,000 30,000 40,000 50,000 60,000 Non-domestic Domestic Private-Public Split within Domestic and Non-Domestic Stock in Argyll and Bute Public Owned Privately Owned
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Argyll and Bute Council LHEES Strategy 51 Figure 13: Non-domestic property count and total heat demand in Argyll and Bute Primary fuel type in non-domestic buildings Over half of non-domestic properties across Argyll and Bute use electricity as their main fuel source, a total of 6,317 properties (Table 18). Electricity is used to meet 66% of the total heat demand for non-domestic properties in Argyll and Bute, providing 236,428 MWh/year of heat. Figure 14 shows that oil and other fuels make up a slightly higher percentage of heating demand when comparing to property counts. This suggests that properties using these fuel types have a higher heating demand than those fuelled by electricity. 0 50,000,000 100,000,000 150,000,000 200,000,000 250,000,000 0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 Non-domestic property count and heat demand Count Heat Demand (kWh/yr)
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Argyll and Bute Council LHEES Strategy 52 Table 18: Non-domestic property count by main fuel type. Source: Non-Domestic Analytics v.1.1 Electricity Mains gas Oil Other 6,317 (66%) 1,014 (11%) 1,580 (16%) 713 (7%) Table 19: Heat demand by main fuel type (MWh/yr). Source: Non-Domestic Analytics v.1.1 Electricity Mains gas Oil Other 236,428 (48%) 80,257 (16%) 111,346 (23%) 60,552 (12%) Figure 14: Count of non-domestic properties by main fuel type and respective heat demands within Argyll and Bute 6,317 66% 1,014 11% 1,580 16% 713 7% 236,428 48% 80,257 16% 111,346 23% 60,552 12% 0% 10% 20% 30% 40% 50% 60% 70% Electricity Mains Gas Oil Other Relationship between count of non-domestic properties by main fuel type and respective heat demands (MWh/yr) Count Sum of Heat demand (MWh/yr)
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Argyll and Bute Council LHEES Strategy 53 5. LHEES Priorities The residents of Argyll and Bute inhabit an area characterised by its remote rural and insular geography. Approximately 17% of the population resides across 23 inhabited islands, while others live in areas of similar seclusion, such as the Kintyre peninsula. This unique geographical makeup presents distinct challenges in the implementation of decarbonisation measures. The remoteness and insularity of these communities result in a lack of viable heat decarbonisation options, skills shortages, supply chain issues, and grid capacity limitations. This renders conventional measures applicable to other parts of Scotland impractical. It is imperative to develop tailored solutions to address these exceptional challenges. Guiding Principles The priorities for Argyll and Bute's LHEES have been established based on the following guiding principles: • Developing an approach that considers the unique challenges encountered by island and remote rural communities. • Ensuring LHEES actions do not exacerbate the Council's “housing emergency”. • The area’s natural assets are harnessed and optimised. • Ensuring a “Just Transition” to net zero. • Opportunities for community wealth building are maximised. This first iteration of the LHEES necessitates a focused approach on a select range of key programmes aligning with local and national priorities. However, the documents also aim to serve as a prospectus for targeted investments intended to achieve heat decarbonisation and optimise energy efficiency outcomes. LHEES Priorities • Address grid infrastructure • Building sustainable and energy resilient communities • Address the supply chain constraints and shortage of skills • Improve education and awareness of decarbonisation requirements and solutions • Tackle fuel poverty • Ensure a “Just transition” to net zero • Decarbonise heat sources • Energy efficiency, a fabric-first approach and getting buildings heat pump ready
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Argyll and Bute Council LHEES Strategy 54 5.1. Address Grid Infrastructure The Council is firmly committed to achieving the decarbonisation of heating in homes and buildings by 2045. To accomplish this goal, the Council will need to collaborate closely with the area's two Distribution System Operators (DSOs) SSEN and SPEN. The severely constrained electricity grid poses a significant obstacle to the mass electrification of heat in the short to medium term. Collaboration with both DSOs is essential to develop a grid system that can effectively support the Council's net zero commitment. Furthermore, the area's unique geography presents challenges when it comes to upgrading grid infrastructure. For example, enhancing electricity capacity on islands requires the costly upgrade of subsea cables. In some island communities, the DSO are using diesel generators to generate electricity to power heat pumps in homes. 5.2 Building Sustainable and Energy Resilient Communities The majority of householders in island areas rely on fossil fuels such as oil and LPG to heat their homes and buildings. These fuel sources are transported to islands via ferries. This not only elevates fuel costs but there are also fuel security implications as islanders are dependent on ferry services for their energy supply. Argyll and Bute’s LHEES Delivery Plan will encourage communities to devise local place-based plans outlining local bespoke solutions for reducing energy demand and decarbonising the heat source. These plans should prioritise both reducing carbon emissions from heating homes and buildings and addressing energy security to fortify community resilience. 5.3 Address supply chain constraints and shortage of skills The energy efficiency and decarbonisation workstream has the potential to generate substantial economic benefits for businesses and the labour markets. These advantages include: • Enhancing the job offer with higher paid, higher skilled jobs. • Bolstering the supply chain. • Offering opportunities for technological enhancement. • Providing businesses with the opportunity to grow by operating in the rapidly expanding green economy. However, there is a noticeable deficiency in the expertise required to implement energy efficiency and heat decarbonisation measures in Argyll and Bute. This is evidenced by the fact that Argyll and Bute is struggling to secure installers for the 'Great British Insulation Scheme’. This skills shortage has the following implications: • It presents a significant obstacle to achieving the goal of decarbonising homes and buildings in Argyll and Bute by 2045.
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Argyll and Bute Council LHEES Strategy 55 • This shortage results in higher installation costs, as skilled individuals must be brought in from afar due to the lack of local expertise. • The absence of a locally available skilled workforce poses significant challenges in ensuring servicing and maintenance of decarbonised heat technologies. • Inability to unlock the economic benefits of heat decarbonisation such as high-value job opportunities in a growth sector. In 2022, Historic Environment Scotland (HES) conducted a skills audit in Argyll and Bute. This research highlighted while most trades faced difficulties attracting personnel, the prevalent theme was the challenge of drawing in and retaining young individuals within the construction industry. This finding has been backed up by several training providers offering courses in energy efficiency measures or renewable energy technologies. These courses have either been undersubscribed or have had to cease due to lack of demand. The LHEES Delivery Plan will outline the actions that need to be taken by the Council and key stakeholders to increase the number of people choosing this career route. It will lay out how Argyll and Bute will ensure training and skills development programmes are available to increase the number of skilled people in this sector. 5.4 Improve education and awareness of decarbonisation requirements and solutions The complexity of the decarbonisation process necessitates a thorough understanding of the various technologies and energy efficiency measures. Without such knowledge, building owners will encounter challenges in identifying the most suitable low or zero carbon heating system for their specific building. An educational campaign for the general public is imperative to elucidate available options, their respective advantages and disadvantages, and maintenance requirements. The Argyll and Bute LHEES process involved surveying professionals in the energy efficiency and housing management sectors. The findings revealed that although they possessed theoretical knowledge of low and no carbon heat technologies and energy efficiency measures, the majority lacked insight into the most suitable technology or energy efficiency measures for their homes. Thus, it is vital to provide building owners with the necessary advice and support to facilitate decarbonisation Despite multiple agencies offering funding and guidance, identifying the most appropriate agency to consult can be arduous. Delivering decarbonisation and energy efficiency objectives hinges on building owners having access to tailored decarbonisation plans, comprehensive information about available funding opportunities, and experts adopting a “whole building approach”. Building owners often seek to transition to low or zero carbon energy or implement energy efficiency measures following unexpected events, such as boiler malfunctions or building repairs necessitated by inclement weather. Timely access to impartial advisors is essential to ensure that building owners can successfully implement these measures. If access to such advice is delayed,
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Argyll and Bute Council LHEES Strategy 56 building owners may proceed with repairs and maintenance without taking the opportunity to install decarbonisation measures. There are various tools on the market which could offer building owners bespoke advice to enable them to ascertain the most appropriate decarbonisation pathway for their building. Promoting the use of such tools could be advantageous, as they could result in higher rates of energy efficiency and decarbonisation measures being installed. However, it is vital for the Council to be confident that such tools provide accurate advice. Promoting tools that provide inaccurate or incorrect advice would create credibility issues for the Council. To summarise, there is a need to: • Dispelling the myths about heat pumps and heat networks by providing case studies and good news stories. • Conduct a comprehensive nationwide education and awareness campaign on heat decarbonisation and energy efficiency measures. • Increase awareness of decarbonisation technologies for building owners. • Identify energy efficiency measures to reduce heat demand. • Ensure that building owners are aware of where to access tailored advice and support. • Offer guidance on the cost of installing decarbonisation technologies and direct building owners to funding opportunities. Some of these actions will be the responsibility of national agencies while others will be actions needed to be taken within Argyll and Bute’s LHEES elivery Plan. 5.5 Tackle Fuel Poverty Addressing fuel poverty remains a priority for the Council. The ongoing cost of living crisis is felt particularly hard in rural and remote rural areas, as Figure 15 shows. Argyll and Bute: • Ranks third lowest in median pay rate among all Scottish local authorities. • Face higher costs, ranging from 13% to 185% higher than urban UK areas. • Have around 70% of households at risk of fuel poverty.
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Argyll and Bute Council LHEES Strategy 57 Figure 15: Cost of living in Argyll and Bute. Source: Argyll and Bute – Cost of Living Crisis Case for Support Since 2022, high fuel prices have radically increased fuel bills. Figure 16 shows that the average fuel bill in Argyll and Bute is 62% higher than in Scotland as a whole. Figure 16: Average Fuel Bill (£ pa) in Argyll and Bute and Scotland. Source: Home Analytics v.3.9 High fuel costs combined with homes in Argyll and Bute requiring more heat to feel comfortable than homes in other parts of Scotland will likely push more households into fuel poverty. This is illustrated in Figure 17, which indicates that energy demand in Argyll and Bute exceeds 31,000 kilowatt hours per year, while the Scottish average is lower at 22,000 kilowatt hours per year. This equates to almost a third higher energy demand in Argyll and Bute. 1,604 993 Average estimate Scotland average Average Fuel Bill (£ pa)
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Argyll and Bute Council LHEES Strategy 58 Figure 17: Average Energy Demand (kWh/year) in Argyll and Bute and Scotland. Home Analytics v.3.9 Living in a cold home can have significant impacts: • Health impacts: Cold homes have been linked to several health conditions, especially affecting older, vulnerable, and disabled residents as well as younger residents of Argyll and Bute. • Child poverty impacts: A report on child poverty in rural and island regions highlights that fuel costs are a major contributor to fuel-related poverty in these communities. This is due to reasons such as larger and older housing stock, and reliance on expensive oil or electric heating. Interventions focusing on reducing costs for these households, such as improving insulation to lower energy bills, could be particularly helpful. • Impact on life chances: Research indicates there is a relationship between poor housing and lower educational attainment.14 This means children living in inadequate housing are more likely to have lower educational attainment, negatively impacting their life chances. Although most of the Council does not have a traditional gas network, some of the towns have ‘town gas’; where gas is delivered to the town, gas tanks are filled, and gas is then piped around the town. The unit price of gas is considerably lower than electricity. Therefore, tenants and homeowners could be driven into fuel poverty if they switch from a gas heating system to an electric heat source. The LHEES has a duty to ensure that any decarbonisation plans would not drive people into fuel poverty. Consequently, the Council is prioritising areas which are off the gas grid, as transitioning to low or zero carbon heating is less likely to result in increased energy bills. 14 Shelter (2013) People Living in Bad Housing URL: https://assets.ctfassets.net/6sxvmndnpn0s/6pmYen0M6fWEJCcKqEq5sY/95d09421aeeec22dcc37c6cd202f c5bc/People_living_in_bad_housing.pdf 31,131 22,751 Average estimate Scotland average Average Energy Demand (kWh/year)
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Argyll and Bute Council LHEES Strategy 59 5.6 Ensure a “Just Transition” to Net Zero It is essential that the move to net zero is a just transition. In other words, fair and equitable, where no community is unable to experience the benefits of low carbon heating at an affordable cost. Historically resources for energy efficiency measures and heat decarbonisation measures have been concentrated on social housing, often resulting in private tenure homes being overlooked when it came to retrofitting. Additionally, householders who live in areas of low heat density will not have access to heat networks. This leaves very limited options for heat decarbonisation and risks some homes being left behind. The LHEES aims to provide a just transition and will focus on: Rental properties The SHNZS and the HIB are both proposing that rental properties failing to meet energy efficiency and heat decarbonisation standards will be prohibited from being re-let. With the Council declaring a housing emergency, it is crucial not to deplete housing stock and worsen the emergency. The LHEES will focus on supporting rental properties to meet energy efficiency and heat decarbonisation standards, to ensure that they are retained and re-let. Another reason why the LHEES will prioritise rental properties is that the Council recognises that tenants have limited agency and, consequently, are unable to decide to transition to a low-carbon heating source or install energy efficiency measures. Public Sector Buildings (PSB) PSB are expected to transition to clean heating before other non-domestic buildings. The LHEES will focus on decarbonising the heat sources of PSB. Off-gas households Off-gas households are more at risk of suffering fuel poverty due to the high cost of oil, LPG or electricity relative to gas. As a result, it is a priority of Argyll and Bute’s LHEES to ensure off-gas grid properties receive better insulation and affordable heating systems to help reduce the likelihood of fuel poverty. The Council and its RSL partners have prioritised off-gas rental properties for retrofitting. This is so support can be given to rental stock that is at risk of being withdrawn following the implementation of SHNZS and HIB, as well as helping the tenants of these properties avoid fuel poverty during this transition. Additionally, the Council will prioritise retrofitting its own non-domestic buildings in off-gas grid areas, as it can generate greater savings in heating bills compared to similar buildings on the gas grid. The cost of retrofitting will be reimbursed sooner in off-gas grid buildings, enabling the council to transition more buildings to low and zero carbon heating solutions.
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Argyll and Bute Council LHEES Strategy 60 Social Rented There are 2,960 off-gas socially rented buildings within Argyll and Bute, all of which are owned by housing associations. Map 2 illustrates the concentration of off-gas grid socially rented properties (by count) within areas of Argyll and Bute. The data zones15 with the highest counts are: • Whisky Isles – 05 • Oban South – 05 • Oban South - 07 • Mull, Iona, Coll and Tiree – 03 • Oban North – 04 Map 2: Count of off-gas socially rented (housing association only) properties in Argyll and Bute 15 Data zones are defined areas which are used for the analysis of statistics across the public and private sector in Scotland. Data zone boundaries can be viewed here: https://spatialdata.gov.scot/geonetwork/srv/api/records/7d3e8709-98fa-4d71-867c-d5c8293823f2
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Argyll and Bute Council LHEES Strategy 61 Private Rented Around 17% of the total off-gas housing stock is privately rented. Map 3 illustrates the count of privately rented domestic properties within Argyll and Bute. The highest levels are in: • Bute - 04 • Whisky Isles - 03 • Knapdale – 01 • Whiskey Isles – 02 • Mull, Iona, Coll and Tiree – 03 The area around Whisky Isles has the highest number of socially rented and privately rented properties. By looking at areas with overlapping criteria, opportunities for access to economies of scale in the decarbonisation plan can be identified. Map 3: Count of off-gas privately rented properties in Argyll and Bute
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Argyll and Bute Council LHEES Strategy 62 Owner Occupied The majority of off-gas grid properties within the local authority are owner-occupied (17,085). Map 4 depicts the highest concentrations of this property tenure to be found in: • Mull, Iona, Coll and Tiree - 01 • Cowal North - 01 • Mid Argyll - 03 • Cowal South - 01 • Loch Awe – 03 Map 4: Count of off-gas owner-occupied properties in Argyll and Bute
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Argyll and Bute Council LHEES Strategy 63 Opportunities from a ‘Just’ approach The opportunities are as follows: • For eligible tenants and homeowners in off-gas grid areas to access ABS, Warmer Home or ECO funding to provide energy efficiency measures or cheaper, cleaner energy to heat their home. • Off-gas rented properties face higher rates of fuel poverty. Targeting these will help address the high rates of fuel poverty in the council area whilst meeting net zero requirements. • To reduce the number of private properties with an EPC band D or below, as significantly more properties in Argyll and Bute have an EPC band D than in Scotland as a whole. • Having completed 49 energy efficient projects in non-domestic buildings since 2021, the learnings of these retrofits can be applied to similar off-gas non-domestic public buildings in the future. Challenges of a ‘Just’ approach Argyll and Bute face a number of challenges in realising the just transition such as: • Remote rural and island areas encounter higher costs than urban areas. Figure 15 shows that island communities pay between 13% and 185% more for goods compared to their urban counterparts. Therefore, the costs of decarbonising is likely to be higher in Argyll and Bute than in urban areas. • Argyll and Bute face additional challenges in engaging installers or tradespeople to carry out energy efficiency and decarbonisation works due to local skills shortages and being very remote from the central belt. As most off-gas properties are located on the islands, they would have to pay a premium for installers to travel there. • The majority of building owners will not be in a heat network and so will not benefit from low or no cost connection to a decarbonised heat source and instead will have to invest £10- 20k to install a heat pump. This discrepancy is unfair and disadvantages building owners in remote rural and island communities. • Some landlords may be unable to engage an installer, connect to the grid due to constraints, or have access to finances to invest in a clean heating system. Therefore, these landlords will be unable to let their property, exacerbating the housing emergency. Therefore, the LHEES has prioritised supporting the private rented sector in transitioning to clean low-cost heat. • Many communities are not scheduled to have grid infrastructure improvements for many years. They will be unable to reap the benefits of transitioning to clean, low-cost heat. The LHEES will focus on decarbonising heat sources in buildings that already use electricity or
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Argyll and Bute Council LHEES Strategy 64 are in off-gas grid areas with grid headroom to allow for the transition to low—or zero carbon heating systems. • Private Sector Landlords are not a homogeneous group and are not eligible for many funding sources. • Homeowners are also not a homogeneous group. Homeowners on passport benefits have access to a wider range of funding support to enable them to install energy efficiency measures and decarbonise their heat source. Most other homeowners do not have access to funding to decarbonise. • Encouraging tenants to apply to the ABS scheme is difficult. • The Council does not own social housing stock, so must work closely with the various RSLs to target the retrofit of off-gas rented properties. • The Council is facing staff resource and capacity issues. It will be challenging to find time to undertake all the required partnership working to delivery this outcome. • 5.7 Decarbonising the Heat Source This section outlines the various mechanisms which the Council are considering to use to decarbonise heating in Argyll and Bute. 5.7.1 Heat Networks In the UK Government Department for Business, Energy and Industrial Strategy, Heat Networks’ define a heat network as follows: “Heat networks (also known as district heating) supply heat from a central source to consumers, via a network of underground pipes carrying hot water. Heat networks can cover a large area or even an entire city or be fairly local supplying a small cluster of buildings”. 16 As part of their plan, the Council aim to transition to a clean heating system by establishing heat networks or expanding existing zones. Heat networks, depending on their fuel source and efficiency levels, can reduce greenhouse gas emissions and fuel poverty levels across Argyll and Bute. Furthermore, their design makes it simple to enable additional new heat sources with minimal disruption, making potential future expansions to existing networks across the region cost- effective. Heat networks may also help to reduce householders’ energy bills and tackle fuel poverty, if well-designed and operating efficiently using an appropriate heat source. To be efficient, economically viable and deliver value for money, heat networks must be well located. This means being in areas with sufficient heat demand and density to enable optimal performance. Argyll and Bute is generally a low heat dense region which limits the opportunities for 16 UK Government Department for Business, Energy & Industrial Strategy. What is a heat network?. Available at: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/696273/H NIP_What_is_a_heat_network.pdf). (Accessed: 04/07/2024).
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Argyll and Bute Council LHEES Strategy 65 heat network development. Argyll and Bute’s population density (13 persons per km2) is significantly lower than the Scottish national average (70 persons per km2). Heat network development also requires securing connections to the network from buildings with large, reliable, and long-term demand for heat. These are known as ‘anchor loads’ and are essential in allowing heat networks to operate efficiently. In collaboration with a range of stakeholders, the Council is looking to build new heat networks and expand existing heat networks. Heat Network Progress • Shared ground loops o Argyll and Bute is not a heat-dense area. Only small tracts of land within the local authority will be suitable for heat networks as specified by the Scottish Government’s methodology. o As part of the LHEES process the Council, Zero Waste Scotland, and Buro Happold carried out a study to identify sites in the local authority area which would be most suitable for smaller heat networks, namely shared ground loops. o The advantage of shared ground loops is that shared infrastructure means the capital costs of the project diminish, making the transition to decarbonised heat more viable. • Waste Water to fuel heat networks o In 2018, a joint venture between Argyll and Bute Council, Scottish Water Horizons and SHARC Energy Systems enabled Campbeltown’s Aqualibrium leisure centre to be heated by wastewater from the Kinloch Park Pumping Station. o The heat-from-wastewater technology was one of the first of its kind and was funded by Scottish Water Horizons and the Scottish Government’s Low Carbon nfrastructure Transition Programme (LCITP). The Council is keen to expand this project and is actively investigating this, as well as the viability of devising similar projects in other parts of the authority. Heat Network Data Analysis was undertaken to identify the areas where heat networks present a decarbonisation pathway that could be of strategic importance for Argyll and Bute. The areas of greatest potential were identified based on heat density and the identification of anchor loads (see Appendix E for the full methodology). For the first iteration of the LHEES, only non-domestic buildings that the Council has full or partial control over were treated as potential anchor loads in the heat network zoning exercise. This is because the Council has greater control over the operation of these buildings and can guarantee their use as an anchor load. A total of five indicative heat networks have been identified from the analysis (Map 5). These are in the areas of Campbeltown, Rothesay, Lochgilphead and Bowmore.
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Argyll and Bute Council LHEES Strategy 66 Prior to the LHEES, Argyll and Bute had conducted a pilot study on heat networks. In the study, 10 district heat network clusters were identified, with similarities seen between the pilot study and the LHEES analysis (Appendix F). In particular, the areas of Oban, Lochgilphead and Campbeltown were further identified as possible priority heat network development opportunities considering number of property connections, fuel poverty statistics, nearby waste heat sites and local development projects. However further investigation will be required to determine if these are viable heat networks the LHEES delivery plan will set out actions on this regard. Heat Network Opportunities • Work with stakeholders carrying out infrastructure works (e.g. RSLs who are building new homes). This enables the heat network infrastructure to be laid at a lower cost. This could potentially be a game changer for the Lochgilphead heat network which may have been precluded because of the cost of infrastructure. • The Council has Rural Growth Deal funding to develop a decarbonised heating project in Islay which has a potentially viable heat network opportunity. Islay has also devised plans to become a net zero community and have carried out a feasibility study to this end. Consequently, the Council and stakeholders have data, the desire and funding to carry out a project on Islay. • The community in Iona have undertaken a feasibility study to develop a heat network on the Island. • The expansion of heat networks among coastal and off-gas communities can help them transition away from expensive fossil fuels. • The Council has previously worked in partnership to build successful heat networks in Campbeltown and is actively seeking to expand this project. • There are also several district heating schemes in the local authority area which provide learnings for future projects. Heat Network Challenges • Argyll and Bute is not a heat-dense area, so developing heat networks within the council boundaries will be costly and generate more limited financial returns than networks built in heat-dense areas. Consequently, it will be difficult to leverage in private sector investment to build heat networks, leading to a greater need for public sector funding. • Local and Scottish Government capital budgets have been diminished in real terms. It will be challenging to find monies to invest in heat network infrastructure. • To develop a heat network will require considerable staff resource to collaborate with stakeholders. However, the current staff capacity is inadequate to fulfil this role.
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Argyll and Bute Council LHEES Strategy 67 Map 5: Heat network opportunities in Argyll and Bute as identified within LHEES
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Argyll and Bute Council LHEES Strategy 68 5.7.2 Heat Pumps Many communities in Argyll and Bute do not live in one of the potential heat network zones nor will they be able to transition to a heat pump due to the grid being unable to provide the capacity for mass electrification of heat. Other decarbonisation solutions must be found. These are explored in the next section. 5.7.3 Bespoke solutions for Argyll and Bute Biomass The Energy Saving Trust classify biomass as a ‘lower carbon option’. The carbon dioxide emitted when wood is burned is the same amount that was absorbed over the months and years that the plant was growing. Home Energy Scotland currently provide £7,500 (up to £9,000 in remote rural areas) of grant funding to install a biomass boiler. A further £7,500 is available as an optional interest-free loan for homeowners wishing to transition to this fuel type. In addition, some farmers, hotels, council buildings, swimming pools, and other non-domestic buildings in Argyll and Bute transitioned to biomass following the introduction of the Scottish Government’s Renewable Heat ncentive (RH ). This scheme paid building owners per kWh of heat generated enabling the monies invested in a biomass heating system to be recouped. Using biomass allows building owners reliant on oil, LPG or gas to move from fossil fuels to a lower carbon fuel. Biomass is important in rural areas as it: • Provides local employment with jobs in installing stoves, cleaning chimneys and supplying wood fuel • Provides free fuel for estate workers, farmers, other landowners, and local people who have scavengers’ licences allowing them to find wood fuel on Forestry and Land Scotland sites. Without this free fuel, some of these households would fall into fuel poverty. • Is part of the circular economy using the waste wood product from timber harvesting or industrial processes Unused locally generated energy In 2023, the total operational capacity of renewable developments was over 1552MW which is approximately 10% of the Scottish total. In addition, there is potential to increase clean energy production to five gigawatts17 in the next decade. Current renewable installations such as windfarms and hydro can produce significantly more energy, but grid constraints mean this energy cannot be exported to the grid. These installations are turned off until the grid can facilitate the energy they generate. The Council and stakeholders are keen to harness this potential electricity. The LHEES Delivery Plan will investigate potential technological solutions which would either utilise energy locally for example making green hydrogen, storing the electricity in industrial scale 17 Argyll and Bute Council Development and Economic Growth. Argyll and Bute Council’s Economic Strategy Refresh: 2024-2034. Available at: https://www.argyll- bute.gov.uk/moderngov/documents/s205254/ARGYLL%20AND%20BUTE%20COUNCILS%20ECONOMIC %20STRATEGY%20REFRESH%202024-2034.pdf (Accessed: 12/07/2024).
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Argyll and Bute Council LHEES Strategy 69 batteries similar to the ones used in the Annan Distillery project, storing heat in thermal batteries or other new technological solutions to maximise local energy production and distribution. Local generation and distribution projects The Council will continue to work with Local Energy Scotland who support local energy generation and distribution projects. Local Energy Scotland has supported the Iona community to carry out research as to whether it would be viable to install a heat network powered by a wind turbine. The proposed heat network would heat homes and the Abbey (a HES asset). The project is seeking funding to implement the recommendations outlined in the feasibility study. Hydrogen and Gas mixed fuels Argyll and Bute have a pilot project where gas is being mixed with hydrogen to reduce carbon emissions. This is not a zero-carbon project but does allow for carbon emissions to be reduced by 20% and is one step in the decarbonisation journey. The advantage of this approach is that there is no need to invest in a new heating system as gas and 20% hydrogen mix can be used with the existing infrastructure. Heat pumps with electricity generated by diesel generators In Islay, buildings have heat pumps, however, there is no grid capacity to power these heat pumps. SSEN installed diesel generators to generate electricity to power the heat pumps. Although these heat pumps are not using clean fuels at present it is a step towards decarbonisation. When grid capacity becomes available these buildings will immediately be transferred to the grid, immediately being heated with clean heat rather than having to wait to install a clean heating system. 5.8 Energy efficiency, a fabric-first approach and getting buildings heat pump ready Argyll and Bute is not a ‘heat dense’ area, with limited opportunities for large Heat Networks. Although there are prospects for district heating systems powered by biomass, progressing these hinges on whether the Scottish Government’s H B bill will allow biomass to be a permitted fuel in its quest towards zero emissions heating. Currently, the only permitted or available decarbonisation options for most buildings in Argyll and Bute is a heat networks powered by shared ground-loops, individual heat pumps or direct electric heating systems. All these options necessitate grid capacity, which is constrained in most of the Council area. Local DSOs have indicated that significant infrastructure upgrades will be required before mass electrification of heating can occur in the area. Hence, the LHEES prioritise ensuring that buildings are ‘heat pump-ready’ while the area awaits the necessary infrastructure enhancements.
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Argyll and Bute Council LHEES Strategy 70 Fabric-first A fabric-first approach to retrofit prioritises making the building envelope (walls, roof, floor, doors, windows) thermally efficient, alongside repairs and improvements to the building condition. This reduces a building’s heat demand, before installing a decarbonised heating system. There was a professional consensus that it is crucial to take a fabric-first approach before installing a heat pump. Some funding streams, such as Warmer Homes, require recipients to agree to install all the offered insulation measures before they can have a heat pump or electric storage heaters installed. This approach of having to comprehensively treat the building fabric can be time- consuming and costly, potentially discouraging building owners from acting. There is a new school of thought which recommend that heat pumps should be installed without having to deal with all the fabric requirements. While this could be more effective in reducing carbon emissions it does have other potential implications such as failing to reduce the buildings heat demand which could increase the cost of energy bills. In domestic settings, this could lead to fuel poverty. It is important that the Council engage with various RSLs about implementing this fabric-first approach so they have the time and resources to explore funding options and plan how to make their properties heat pump ready. Additionally, outlining a fabric-first focus to private tenure households enables retrofitting schemes, like ABS, and various funding streams to be promoted so it becomes more accessible to transition to a heat pump ready home. Building fabric challenges in Argyll and Bute: Social Rented Housing Estimates predict that 1 in 2 homes in the area would fail the Scottish Housing Quality Standard, the regulatory measure for social house conditions. Between 2017 and 2019, an average of 41% of dwellings in Scotland failed the SHQS. Argyll and Bute is one of eight local authorities with failure rates higher than the Scotland average, with 52% of properties in the area failing SHQS standards.18 For Argyll and Bute to meet the SHNZS standard of retrofitting and replace all polluting heating systems in social housing by 2045, a lot of focus will be required on implementing fabric-first across the region. 18 Argyll and Bute Council. Argyll and Bute Local Housing Strategy 2022-2027. Available at: https://www.argyll-bute.gov.uk/sites/default/files/migrated_files/argyll_bute_local_housing_strategy_2022- 2027.pdf. (Accessed: 12/07/2024).
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Argyll and Bute Council LHEES Strategy 71 Figure 18: SHQS Dwellings failures (%, all tenures). Source: SHCS 2017-2019 Private Rented Housing Table 16 in the baseline section indicates that only 27% of privately rented properties in Argyll and Bute attained an EPC band C or higher, whereas 50% achieved a band C or higher in Scotland overall. Owner Occupied Housing In the baseline section, Table 16 indicates that only 24% of owner-occupied properties in Argyll and Bute have an Energy Performance Certificate (EPC) rating of band C or above. In contrast, in the rest of Scotland, 47% of properties have an EPC rating of band C or above. Additionally, 17% of domestic properties in Argyll and Bute have the lowest EPC bands (F and G), while only 4% in the rest of Scotland have these lower ratings, representing more than a fourfold difference. How suited are properties in Argyll and Bute to Heat Pumps? The LHEES methodology categorizes buildings from 0 to 3 to determine which buildings are most and least suited for heat pumps. The LHEES prioritises categories 1 and 2, where a heat pump would be a suitable heating system. Table 20 indicates that 44% of domestic buildings in Argyll and Bute are suitable for a heat pump installation.
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Argyll and Bute Council LHEES Strategy 72 Table 20: Percentage of domestic properties in Argyll and Bute under each building category assessed for heat pump suitability. Source: Home Analytics v.3.9 Building category Description % of domestic properties Category 0 Those properties already have a low or zero emissions heating system i.e. these properties have heat pumps or are connected to a heat network 9% Category 1 Those considered highly suitable for heat pump retrofit (i.e. well insulated properties with a wet heating system). 19% Category 2 Those with secondary potential for heat pump retrofit (i.e. properties in need of moderate fabric upgrades and or additional wet distribution to be heat pump ready) 25% Category 3 Those with tertiary potential for heat pump retrofit(i.e. properties in need of significant fabric upgrade to be heat pump ready) or those less suited to heat pump technology with electric (storage or direct electrical) or biomass likely to be the most viable decarbonisation technology 47% Map 6 gives an illustration of the concentration of heat pump ready domestic properties (by count) within areas of Argyll and Bute. As shown in the map, the areas with the highest levels of Category 1 (heat pump ready) properties are: • Kintyre Trail • Garelochhead • Mull and Iona
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Argyll and Bute Council LHEES Strategy 73 Map 6: Off-gas Category 1 domestic properties in Argyll and Bute by count. Category 2 properties are also suitable for a heat pump but would require moderate fabric upgrade and a wet heating system installed. Map 7 provides an illustration of the distribution of Category 2 properties. The areas with the highest levels of Category 2 buildings are found in: • Loch Awe • Greater Lochgilphead • Oban South
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Argyll and Bute Council LHEES Strategy 74 Map 7: Off-gas Category 2 domestic properties in Argyll and Bute by count. The LHEES delivery plan will: • Prioritise getting buildings heat pump ready, ensuring that once there is adequate grid capacity heat pump installations can be undertaken swiftly to decarbonise heating. • Focus on homes where energy inefficiency is a driver of fuel poverty, to lift people out of fuel poverty. • Focus on non-domestic council buildings which require fabric improvements. The Council has successfully delivered 49 decarbonisation projects which are outlined in the NDEEF plan and consequently, these buildings are on their way to being heat pump ready.
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Argyll and Bute Council LHEES Strategy 75 Opportunities with a fabric first approach • The Area Based Scheme (ABS) is available for eligible owner occupiers and tenants in the private rented sector. This programme will play a crucial role in dealing with fabric issues and getting homes' heat pumps ready. • Maximise the number of homes in Argyll and Bute that access Warmer Homes Scheme, ECO and ECO4Flex to decarbonise heating homes and buildings. • The Council’s 49 completed non-domestic energy efficiency projects could act as vital case-study in how to effectively undergo a fabric-first retrofit prior to making a building 'heat pump ready'. • Maximising access to the Council’s Scheme of Assistance, as it can support eligible building owners tackle building condition issues. • RSLs will be keen to take a fabric-first approach, as this is in line with their likely duties outlined in the Social Housing Net Zero Standard. • Potential grid development on the off-gas islands, Iona, Coll and Tiree, means a transition to an electric heating system. This could see a significant reduction in the level of fuel poverty on these island communities. Challenges with a fabric first approach: • A higher proportion of domestic properties than seen nationally are EPC band E and below. • When compared with buildings nationally, a high proportion of the buildings in the local authority areas have inadequate insulation levels. • The Council has one of the highest levels of substandard buildings and buildings below tolerable standards. • The bespoke building archetypes make it difficult to retrofit fabric upgrades at scale. • Forty seven percent of domestic buildings in Argyll and Bute are category 3 buildings which require significant fabric upgrade to be heat pump ready. In some cases they will not be suitable for a heat pump. • The Council do not directly control the social housing in the region, limiting its influence in promoting properties get heat pump ready. • The grid constraints experienced on some islands may prevent some communities transitioning to electric heating in the near-future.
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Argyll and Bute Council LHEES Strategy 76 6 Challenges This section provides an overview of the challenges Argyll and Bute Council will face when delivering on the LHEES priorities. Geography Argyll and Bute is the second-largest local authority in Scotland, encompassing nearly 9% of the nation’s total land area. The area is sparsely populated, with 43% of the population living in remote rural areas and 17% living on one of the area’s twenty-three inhabited islands. This results in just 13 people per km2, significantly lower than the Scottish average of 70 per km2. Argyll and Bute has a considerable coastline, with 79.7% of the population living within 1km of it. Buildings sitting along this elevated coast are often very exposed to extreme weather, and so are often hard-to-heat and hard-to-treat. To reduce energy demand, these properties often require significant investment to the building fabric. Argyll and Bute's geography also has a significant impact on heat pump viability, the cost of upgrading the grid and the high cost of decarbonising due to the constrained supply chains. Heat Network Viability Argyll and Bute has a very low heat density, which means establishing heat networks is not generally economically viable. As a result, many building owners in Argyll and Bute will not be able to use this low-cost measure to connect to a decarbonised heat source. Inadequate Grid Infrastructure Argyll and Bute has significantly constrained grid infrastructure which is currently blocking new houses being built. Mass electrification of heat is not possible in many communities within the council area. These grid limitations, in conjunction with the unsuitability of most of the council area for heat networks, constitute the principal impediments to the realisation of the LHEES priorities. Category 3 Buildings Argyll and Bute has 47% domestic buildings categorised as category 3 buildings. Category 3 buildings, are not well suited for a heat pump and "direct electric heating or biomass is likely to be the most viable decarbonisation technology." However, due to grid constraints in significant parts of the area, mass transition to direct electric heating is not feasible. Additionally, policymakers have not yet made definitive decisions regarding whether biomass will be an approved decarbonisation measure in the future. Until these issues are addressed, the Council is unable to formulate solutions for decarbonising category 3 buildings.
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Argyll and Bute Council LHEES Strategy 77 Financing Decarbonisation in Argyll and Bute The Council's geography results in communities facing higher costs to decarbonise their buildings than their urban counterparts. For Households and Businesses Argyll and Bute is characterised by a low-wage economy, featuring the lowest average wage levels in Scotland. The region exhibits a higher prevalence of low-income working households, older households, and a significant concentration of small businesses. The cost-of-living crisis has resulted in limited financial resources being available, for householders and many small businesses, to allocate towards decarbonising homes and buildings. This, coupled with high unit costs of decarbonising buildings in areas like Argyll and Bute, puts the area at a disadvantage when implementing the decarbonisation programme outlined in this strategy and delivery plan. It is essential that funders consider areas like Argyll and Bute when allocating funding resources as these areas have less opportunities to leverage in funds from the private sector. Public Sector Buildings It is important to recognise that capital budgets within local authorities have endured significant reductions. The extensive shift to low and no carbon heating will necessitate considerable capital expenditure, with substantial investment imperative from both national governments and the private sector. Supply Chain There is currently a shortage of contractors available to perform decarbonisation work in the local authority area. Local installers will often only accept work in their immediate locality and reject jobs which have significant travel times. Contractors from the central belt experience extended travel times which is exacerbated if they need to travel by ferry. For example, a journey from Glasgow to Tiree takes nearly seven hours. Building Architypes: Bespoke Properties The Strategic Housing Investment Programme (SHIP) outlines the future house building programme for the local authority areas. It demonstrates that housing associations and community housing projects primarily build a small number of properties. Although, there are a few large-scale projects in Oban, Dunbeg, and Helensburgh these projects take several years to complete and consequently have different building specifications. This historical trend has resulted in a diverse range of building types in the social housing stock. This diversity is also reflected in the private sector, where there is a significant number of custom-built properties. These include farms, estate workers' housing, self-built properties, and buildings with unique extensions and conversions. This patchwork of building styles creates the following challenges: • Large-scale retrofit is not viable
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Argyll and Bute Council LHEES Strategy 78 • There are no economies of scale realised by mass retrofitting buildings with the same building architype. As a result, the unit cost of decarbonising buildings is higher. • Building owners often find it difficult to obtain a decarbonisation pathway for unique properties. For instance, a stone farmhouse with a 1980s brick-built extension with an uninsulated cavity requires both solid wall insulation and cavity wall insulation. Some of these properties have suspended floors in the newer section, whereas the older part of the building does not, necessitating different underfloor insulation solutions. Argyll and Bute Council is a “Stock Transfer Authority” Argyll and Bute Council, unlike many others, transferred all its housing stock and consequently does not have direct control over social housing. It is imperative that the Council work collaboratively with housing associations to realise the LHEES priorities. Data Accuracy The LHEES relies on modelled data for its baseline information. In areas where diverse custom buildings populate each street with no consistent architectural style, the data analysis often varies greatly from the actual on-site conditions. Better quality data is essential for making informed decisions.
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Argyll and Bute Council LHEES Strategy 79 7 Opportunities Argyll and Bute are well placed to make a significant contribution to both Scotland and the UK’s Net Zero ambitions by utilising the area’s natural assets. This section provides an overview of the opportunities that the LHEES will provide for Argyll and Bute. Improving Grid The introduction of the LHEES statutory duty in Scotland, and local authorities in England developing LAEP (Local Area Energy Plans), has provided a framework for DSOs and councils to consider each other's policy priorities when developing plans. Economic Opportunities by Local Energy Generation The LHEES provides a wealth of economic opportunities for Argyll and Bute including opportunities to develop local energy generation projects which utilise: • Existing waste heat • The renewable energy produced by Argyll and Bute is currently unable to be exported to the grid. Presently, Argyll and Bute contribute over one gigawatt of clean energy, constituting roughly 10% of the nation's clean energy output. The Council’s economic strategy outlines the potential for increasing this output to five gigawatts over the coming decade. However, the current grid infrastructure does not possess the capability to accommodate this heightened level of generation. This surplus energy could be effectively harnessed locally or through alternative means, such as the production of green hydrogen, charging batteries, or providing heat which can be stored to be used later in thermal storage systems. Transitioning from A Low-Wage Economy to A Higher-Wage Economy Through The Creation Of Green Jobs Realising the LHEES priorities will create significant supply chain opportunities, which will require new jobs and new skills, providing many opportunities for Argyll and Bute’s economy. Improving Access to Finance and Leveraging In Investment to Decarbonise The Heat Source There is a plethora of funds available to support decarbonisation efforts. Nevertheless, navigating this landscape can be confusing, making it difficult to find a fund that provides resources for a particular measure. This is especially challenging for remote and island communities, where options for decarbonisation measures are limited. As a result, building owners in these areas may not have access to the same level of funding as their counterparts in other regions.
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Argyll and Bute Council LHEES Strategy 80 Tools that provide information and guidance to building owners for the identification and implementation of decarbonisation measures, as well as the identification of funding sources, could lead to increased adoption of such measures by building owners. Although much of Argyll and Bute is not conducive to heat networks, the LHEES has identified several potential heat networks that could present opportunities for inward investment in the area. Utilising Technology Rising energy prices have heightened the "cost of doing business" in all economic sectors. Therefore, the LHEES presents opportunities to investigate technologies capable of reducing energy consumption or providing low and zero carbon heat in a cost-effective manner. These endeavours are expected to positively impact the overall expenses of business operations, while simultaneously reducing household energy costs and increasing disposable incomes. Community Wealth Building Argyll and Bute’s Economic Strategy states that “there is a compelling need to strengthen the link with our natural environment and the retention of more of the wealth we generate locally within our local communities”. The council is dedicated to continuous collaboration with partners to enhance the benefits for residents. Implementing the LHEES priorities provides opportunities for local people to access high-skilled, lucrative employment opportunities and empower communities to derive enhanced benefits from clean energy generated in their communities. Reduction in Fuel Poverty Fuel poverty rates are higher in Argyll and Bute than in Scotland as a whole. This is a particular issue that faces many of the coastal communities in Argyll and Bute, especially those that are off- gas grid. The LHEES provides opportunities to connect with these communities and support them to develop and implement local solutions to fuel poverty. Utilising Infrastructure Works to Reduce the Cost Of Installing Decarbonisation Infrastructure Many SHIP projects require significant infrastructure work to be undertaken. The Council will collaborate with housing associations to utilise these infrastructure works, to lay the necessary infrastructure which will allow decarbonising of existing housing. This approach will reduce costs and potentially make unviable heat networks viable. A project of this type is proposed in Lochgilphead, with a new housing development being built in close proximity to a potentially viable heat network. Working together could maximise the number of properties that can transition to a low or zero carbon heating system at a reduced cost. Many of the possibilities for the Council overlap across the three LHEES priorities, such as the success of the non-domestic energy efficiency project guiding the way for change; coordination with housing associations enabling reduced infrastructure costs; and the chance to reduce the
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Argyll and Bute Council LHEES Strategy 81 number of fuel poor households across the region. For the LHEES to reach its potential, these opportunities must be effectively incorporated into the delivery plan. 8 Next steps Argyll and Bute’s LHEES will support the delivery of the Council’s goals of improving energy efficiency, reducing fuel poverty, and decreasing carbon emissions through low or zero carbon heating systems. In addition, it will support the Council and its community planning partners to scale up and align existing programmes, and to increase the scale and pace of retrofit and heat network development that is needed to meet the national target of net zero by 2045. Overall, the content of Argyll and Bute’s LHEES has been informed primarily through a data-driven approach using several datasets and proxy indicators. The Strategy outlines several challenges which need to be overcome to decarbonise Argyll and Bute’s buildings. It also highlights opportunities, including building on the success of existing projects. The next step is for this LHEES Strategy is for the Council to seek feedback as part of a public consultation. The LHEES Delivery Plan has also been developed, which details how the LHEES Strategy will be delivered in practice, providing more detail on delivery areas, timelines, stakeholder engagement and monitoring methods.
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Argyll and Bute Council LHEES Strategy 82 9 Glossary 9.1 Abbreviations Acronym Description DNO Distribution Network Operator ECO Energy Company Obligation EES Energy Efficient Scotland EESSH Energy Efficiency Standard for Social Housing EPC Energy Performance Certificate EST Energy Saving Trust GIS Geographic Information System HA Housing Association HIB Heat in Buildings ABS Energy Efficiency Scotland: Area Based Schemes INTOG Innovation and Targeted Oil and Gas Leasing LA Local Authority LHEES Local Heat and Energy Efficiency Strategy LPG Liquefied Petroleum Gas PEAT Portfolio Energy Analysis Tool SHIP Strategic Housing Investment Programme SHNZS Social Housing Net Zero Standard SPEN Scottish Power Energy Networks SSEN Scottish and Southern Electricity Networks
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Argyll and Bute Council LHEES Strategy 83 9.2 Terms Terms Description Baselining Baselining is the purpose of understanding at local authority or strategic level, the status of the buildings against the Priorities, Targets and Indicators set out in the Baseline tool. Building-level Pathway As part of LHEES Stage 5, a building-level pathway is the outcome of the assessment undertaken using PEAT. It provides the likely energy efficiency retrofit technologies, as well as the low carbon heating system (where applicable) to support building level decarbonisation. Criteria Criteria are the settings applied to the Indicators for each Priority in order to support Baselining, Strategic Zoning and the identification of elivery Areas. An example of Criteria is a simple “no” applied to the ndicator of “wall insulation (Y/N)” to identify properties with uninsulated walls. Another example is the definition of an “anchor load” within the Heat Networks analysis, which applies a minimum threshold to the “heat demand” ndicator. The LHEES methodology provides a set of default Criteria that local authorities may wish to use, with flexibility to update and augment these to support local needs or for more focused analysis linked to specific actions and project identification within the Delivery Plan. Data – Alternative Alternative data can overwrite the Core data to improve accuracy (national to local level of detail, e.g. local housing data to overwrite fields in Home Analytics). Data – Core Core data is the data that is essential to complete the minimum requirements of the LHEES analysis. Core data will come from national datasets e.g. Home Analytics or the Scotland Heat Map. Data – Supplementary Supplementary data allows inclusion of additional Indicators to inform specific, local priorities & targets; also, Supplementary data can be used in GIS investigation to complement the Core analysis carried out in any assessment. An example of Supplementary data would be the inclusion of low carbon heat supply information layers within a district heating analysis. Data Zone Data zones are groups output areas which have populations of around 500 to 1,000 residents. Delivery Area Delivery Areas (sometimes referred to as Delivery Level Areas) are a term used for all LHEES Priorities with the exception of Heat Networks. These Areas will be an important starting point for identifying a range of projects, regulation and actions that are within the competence of the Scottish Government and local authorities (projects and actions to be
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Argyll and Bute Council LHEES Strategy 84 developed in the LHEES Delivery Plan). Delivery Areas are at a higher granularity than Strategic Zones, are generated as part of LHEES Stage 4 and are presented in the LHEES Delivery Plan. Guidance is provided for one approach to identify Delivery Areas, but there are other approaches that local authorities may wish to use. The identification of Delivery Level Areas through LHEES will be indicative only, with further investigation being required to determine the viability of progressing projects associated with the area identification activity. Detailed practitioner guidance Steps These Steps form part of the detailed practitioner guidance in LHEES Stage 4, Generation of Initial Areas to set out particularly suitable heat network zones and to support project identification. Indicator For a given Priority, the purpose of an Indicator is 1) To act as a key information field to help characterise the local authority using the Baseline tool as part of LHEES Stage 3 (authority-wide and at a strategic level); 2) To act as a key information field to support strategic zoning and generation of initial delivery areas (as part of LHEES Stage 3 and 4); 3) if suitable, to act as a key information field to measure progress against Targets over the duration of the LHEES – set out in LHEES Stage 8, LHEES Delivery Plan. For some Priorities, one Indicator may be sufficient, but for others a range may be appropriate. The LHEES methodology sets out a core set of default Indicators that local authorities may wish to use, with flexibility to update and augment these to support local needs or for more focused analysis linked to specific actions and project identification within the Delivery Plan. LHEES Delivery Plan An LHEES Delivery Plan is an action plan that enables a local authority and its partners to work towards delivery of the changes identified in the LHEES Strategy. Actions will contribute to achieving Scotland’s statutory targets on net zero greenhouse gas emissions and fuel poverty, as well as enabling the delivery of changes to buildings and local infrastructure needed to fulfil the Scottish Government’s objectives relating to heat and energy efficiency in buildings. The Delivery Plan will clarify stakeholder roles and responsibilities in delivering the Strategies; build on existing plans and policies, such as HEEPS:ABS Plans, as far as possible and; coordinate across local partners and provide a mechanism for identifying new delivery actions. LHEES Priorities The LHEES Priorities are a list of technologies, building typologies and policy priorities that the LHEES Methodology uses to identify and target interventions. They include: - Heat networks - Off-gas grid buildings - On-gas grid buildings Secondary outcomes include: - Poor building energy efficiency - Poor building energy efficiency as a driver for fuel poverty
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Argyll and Bute Council LHEES Strategy 85 - Mixed-tenure, mixed-use properties and historic buildings LHEES Stages There are 8 LHEES Stages. The purpose of the LHEES Methodology is to enable the local authority to complete LHEES Stages 1 to 6. The completion of these Stages will provide the local authority with the data analysis and evidence base to enable them to complete their LHEES Strategy and Delivery Plan documentation. There are two LHEES guidance templates included alongside this methodology– LHEES Strategy guidance and LHEES Delivery Plan guidance. The completion of these two templates will satisfy the completion of LHEES Stages 7 and 8. The 8 LHEES Stages are: 1 – Policy and strategy review 2 – Data and tools library 3 – Strategic zoning and pathways 4 – Generation of initial delivery areas 5 – Building-level pathway assessment 6 – Finalisation of delivery areas 7 – LHEES Strategy 8 – LHEES Delivery Plan LHEES Strategy An LHEES Strategy identifies what needs to be done to change buildings and relevant local infrastructure by 2045 to fulfil the Scottish Government’s objectives and local priorities relating to heat and energy efficiency in buildings. These interventions might occur at building level or in energy supply networks or in a combination of both. The Strategy will reflect national and local priorities, policies and wider strategies. Where feasible, it will consider local and national factors, such as the timing of planned infrastructure upgrades, access to resources and funding, major projects, decisions over the gas grid and community engagement. Mixed-tenure, mixed- use and historic buildings Mixed-tenure and mixed-use buildings could include a mixture of owner occupied, private rented and social housing, and also non-domestic uses, or simply multiple ownership within the same tenure. Historic buildings include the buildings that are within conservation areas or those that are listed buildings. These categories may require established alternative approaches and regulation for the installation of low carbon heat and energy efficiency solutions and where specific advice and support might be available relating to the installation of these solutions. Potential Zones The Heat Networks Priority follows a distinct methodology to the other LHEES Priorities – Stage 3 does not apply and the outputs from Stage 4 are of a different type, showing Potential Zones for Heat Networks as opposed to the identification of Delivery Areas (notionally using a 100m raster approach). The Heat Networks Priority analysis and activity carried out within LHEES is also anticipated to support activity related to formal zone designation as required by the Heat Networks Act. For
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Argyll and Bute Council LHEES Strategy 86 these reasons, the analysis carried out in Stage 4 for Heat Networks is to identify Potential Zones rather than the otherwise used naming convention of Delivery Areas. The Potential Zones identified are to be included in the LHEES Strategy and could also inform actions around further investigation / progression within the LHEES Delivery Plan. Raster A matrix of squares, or grid, used as a method of data analysis in GIS. Each cell in the grid contains a value representing information on the cell’s contents. Strategic Level Zone Strategic Zones (sometimes referred to as Strategic Level Zones) are a term used for all LHEES Priorities with the exception of Heat Networks. Strategic Level Zones are identified in Stage 3 and are presented in the LHEES Strategy. These zones offer a visualisation of the potential pathways to decarbonise the building stock at a local authority level, split out by intermediate zone level. They are useful to understand the baseline performance, the scale of potential and initial areas of focus. Strategic Zones could be used to inform or prioritise focus areas for the more granular identification of Delivery Level Areas. The identification of Strategic Zones through LHEES will be indicative only. Targets Targets are the measurable aspect of the Priority and are likely to be taken directly from national and/or local policy documentation, for example net-zero by 2045, or EPC C by 2040. Targets are likely to comprise of end-point targets and milestone targets and would sit along a timeline within (and beyond) the LHEES. This timeline would help to prioritise the types of projects undertaken within the LHEES over its duration. Weighting For some Priorities, one Target and Indicator may be sufficient, but for others a range of Indicators may be appropriate to contextualise and characterise performance against a Target and/or progress towards a Priority. If multiple Indicators are used in strategic zoning or the identification of delivery areas, a Weighting can be applied based on the importance of each. The LHEES methodology sets out a core set of default Weightings for instances where multiple Indicators are suggested as a default setting. There is flexibility to update and augment these to support local needs or for more focused analysis linked to specific actions and project identification within the Delivery Plan.
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Argyll and Bute Council LHEES Strategy 87 10 Appendices 10.1 Appendix A: Additional National Policy Drivers Policy/strategy Description Targets/aims Heat in Buildings Supply Chain Delivery Plan This plan sets out how the supply chain needs to grow and develop to meet the future of heating and energy efficiency regulations. Accelerate efforts to build on energy efficiency and reduce the Council’s demand for energy. Rapidly scale up deployment of zero emissions heating systems, such as heat pumps and heat networks. Tackling fuel poverty in Scotland: a strategic approach Sets out the policies and proposals for national government, local authorities, and third sector partners to help meet the targets set in the Fuel Poverty (Targets, Definition and Strategy) (Scotland) Act 2019. Heat Networks Delivery Plan Sets out how provisions of the Heat Networks (Scotland) Act 2021 will contribute to increasing heat networks in Scotland. The plan to facilitate reaching the targets set out in the Heat Networks (Scotland) Act 2021. Draft Energy Strategy and Just Transition Plan The draft sets out key ambitions for Scotland’s energy future. Targets include: the production of more than 20 Gigawatts additional renewable electricity on- and offshore by 2030, accelerate the decarbonisation of domestic industry, transport and heat and to increase contributions from solar, hydro, and marine energy. New Build Heat Standard 2024 (NBHS) This legislation changes building regulations to promote the uptake of zero direct emissions heating systems, such as heat pumps and heat networks. New buildings applying for a building warrant from 1 April 2024 will be prohibited from using direct emissions heating to help reach the targets set in The Climate Change (Emissions Reduction Targets) (Scotland) Act 2019. Review of Electricity Market Arrangements (REMA) (UK Government) Proposed reforms to the electricity market to improve security of supply and cut prices for consumers. Tenements (Scotland) Act 2004 The Tenement Management Scheme (outlined in Schedule 1 of the Act) explains how to come to arrangements
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Argyll and Bute Council LHEES Strategy 88 about maintenance and how costs are shared between owners. The Planning (Listed Building Consent and Conservation Area Consent Procedure) (Scotland) Regulations 2015 This legislation provides the framework for applying for listed building consent and conservation area consent on or after 1st October 2015. Public Sector Leadership on the Global Climate Emergency: Guidance (2021) This guidance provides advice for public bodies on leadership; robust, consistent and comprehensive carbon management; interpretations of the strengthened legislation; and resources available to support public bodies. Provides advice to public bodies to assist with achieving the targets set in the climate change plan 2018–2032 update. NHS Scotland climate emergency and sustainability strategy: 2022-2026 Sets out plans for NHS Scotland to reduce its greenhouse gas emissions and impact on the environment, adapt to climate change and to better contribute to the United Nation’s sustainable development goals. NHS Scotland is aiming to become a net-zero health service by 2040 at the latest. Police Scotland – Environmental Strategy 2021 The Environmental Strategy sets out Police Scotland’s commitment to environmental sustainability and represents an organisational response to the climate crisis. Reduce carbon emissions by 35% over the next 5 years. Includes ambitions to improve energy efficiency of buildings. Historic Environment Policy for Scotland HEPS is a non-statutory policy statement that should be taken into account whenever a decision will affect the historic environment. Promote a way of understanding the value of the historic environment while encouraging consistent, integrated management and decision-making to support a positive outcome for Scotland’s historic assets.
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Argyll and Bute Council LHEES Strategy 89 10.2 Appendix B: Datasets Used in the Development of the LHEES Data Resource/Tool Description Data Format Weblink Scotland Heat Map (SHM) (Summer 2020) Valuable spatial dataset with point-level heat demand data for all properties in Scotland / various other useful data fields and additional information layers. Updated approximately annually. Source data (including from public sector) requested at each update. Spatial geodatabase https://www.gov.sc ot/publications/scot land-heat-map- documents/ Home Analytics v 3.9 (May 2024) Database covering all domestic properties in Scotland, built using information from the domestic EPC register and other sources; statistical models are used to provide estimates giving 100% property coverage Excel spreadsheet https://energysavin gtrust.org.uk/servic e/home-analytics/ Non-Domestic Analytics (version 1.1) Database covering all non-domestic properties in Scotland, built using information from the non-domestic EPC register and various other sources, with extensive modelling to provide estimates giving 100% property coverage Excel spreadsheet Portfolio Energy Analysis Tool (PEAT)[VS1] Tool to accompany Home Analytics; can be used to investigate and cost intervention options for a portfolio of up to 500 properties; can be driven by a price cap or a target EPC score Tool hosted online; input / output as Excel spreadsheet https://homeanalyti cspeat.est.org.uk/ One Scotland Gazetteer (OSG) - Address Gazetteer (AG) Central database for all addresses within an authority GIS API or csv file Local Development Plan sites Information, ideally in spatial format, on development sites in the LDP and LDP2. To include detail on development type and expected build-out where available. GIS shapefiles Waste sites capacity tool (SEPA) SEPA waste heat data Online interactive map viewer/ Excel spreadsheet https://www.sepa.o rg.uk/data- visualisation/waste
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Argyll and Bute Council LHEES Strategy 90 -sites-and- capacity-tool/ Green Heat in Greenspaces (GHiGs) GHiGs investigated the suitability of many types of urban open space across Scotland for use as low carbon heat sources, heat storage sites and heat transmission corridors. Excel spreadsheet https://www.greens pacescotland.org.u k/introducing- ghigs#:~:text=Gree n%20Heat%20in% 20Greenspaces%2 0(GHiGs)%20is%2 0a%20project%20 within%20the,Scott ish%20low%20car bon%20heat%20tr ansition Geographic boundary datasets Information, ideally in spatial format, on Council-owned assets. GIS shapefiles https://borders.ukd ataservice.ac.uk/bd s.html
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Argyll and Bute Council LHEES Strategy 91 10.3 Appendix C: Datasets and Limitations of the LHEES approach Home Analytics Home Analytics Scotland provides essential data on the Scottish housing stock. This data is provided down to the address level and is available to the Scottish Government and local authorities to assist them in developing, targeting and delivering policies, schemes and programmes designed to improve energy efficiency, install renewable technologies and alleviate fuel poverty. The core datasets that make up Home Analytics Scotland are: • Energy Performance Certificate data • Home Energy Efficiency Database (HEED) data • Energy Saving Trust Home Energy Check (HEC) data • Ordnance Survey AddressBase, MasterMap Topography layer and StreetMap data • Scotland Gas Networks data • Scottish Census data • Scottish Index of Multiple Deprivation (SIMD) data While there is full coverage of the Council’s property stock, the data is not entirely accurate given that not all properties are surveyed; where gaps exist property information will have been estimated based on neighboring characteristics using statistical modelling. Fuel poverty figures in the dataset only act as an indication. To date, there has not been a comprehensive dataset detailing fuel poverty given the resources required to do so and the risk of identifying individuals and communities through the use of sensitive information such as income data. The fuel poverty data is therefore probability driven and users should not treat figures as an absolute number or percentage but rather a likelihood of fuel poverty. An instance where fuel poverty data lacks confidence and leads to a poor representation of the geographical area is in households in affluent areas who may be labelled as in fuel poverty because they live in stone buildings with poor heating capture. Currently, fuel poverty data is calculated by the following: • Probability of wall being uninsulated • Loft Insulation Prediction • Loft Insulation: 0-99mm. • Loft Insulation: 100-249mm. • Loft Insulation: >250mm. • No loft • Excess Cold Category 1 Hazard • Probability of Fuel Poverty (Fuel Bill >10% of Income)
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Argyll and Bute Council LHEES Strategy 92 Non-domestic Analytics Non-domestic Analytics is a new data set developed by Energy Saving Trust on behalf of Scottish Government, to provide more property-level details about the non-domestic building stock in Scotland. The dataset brings together property details from a variety of data sources such as the Scottish EPC Register, Ordnance Survey, Scottish Assessors and BEIS, to establish property attributes and energy profiles for each non-domestic building. Like Home Analytics, gaps in these records are imputed using a series of statistical models. The final database is therefore a combination of known and modelled records. There are limitations on the confidence of using Non-Domestic Analytics due to the lack of robust information from the non-domestic sector compared to the domestic sector with much of the data relying on significant modelling. Therefore, users should not take figures as an absolute number or percentage but rather an estimation. Due to the reliance on probability, analysis was limited to exploring groupings of building typologies. The dataset relies on the use of an external categorisation of property typology (Ordnance Survey) resulting in a deviation in standard interpretation of property classes. For example, a church can be classified as either a commercial or place of worship depending on its main function, while residential (non-domestic) buildings can also indicate short-term lets and sheltered accommodation. Scotland Heat Map (2020) Containing both domestic and non-domestic heat demand data, the Scotland Heat Map is a crucial resource to identify the opportunities for efficient heat supply projects and support their development. Developed with data provided by public and private sector organisations including all local authorities, it will help to identify opportunities for new and expanding heat projects including efficient supply projects, such as district heating. The dataset also contains various additional layers such as Geology and hydrogeology, waste energy supply points, and existing heat networks. As the dataset was captured in the summer of 2020, demand data exists only as a snapshot in time. Since network viability is based around the demand of individual buildings, the difference between modelled and expected demand may affect that viability. PEAT-OR tool The PEAT-OR tool, developed by EST, accompanies Home Analytics. It is used to investigate cost intervention options for a portfolio of up to 500 properties. The tool has a relatively high degree of flexibility to be tailored to reveal target areas and properties by price cap or a target EPC score. However, there are the following limitations: • Individual measures cannot be isolated or removed, the tool will show all possible interventions. This means some impractical measures are proposed such as installing wind turbines.
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Argyll and Bute Council LHEES Strategy 93 • Costs and Carbon savings are calculated for all possible measures, this means it is not possible to investigate the impact of individual measures. • Fuel cost data used within PEAT-OR was released at the start of July 2023, with fuel costs modifying frequently these costs are not totally accurate. These limitations will affect the outputs from Stage 5, which should be understood as estimates only. Ordnance Survey Various mapping data, central to the development and use of Scotland's Heat Map and other GIS information sources. OS product data and licenses are required to use SHM & other OS-derived datasets. Key to GIS analysis elements of LHEES. One Scotland Gazetteer Central database for all addresses within an authority. Key to GIS elements of LHEES for identifying multi-tenure non-domestic properties.
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Argyll and Bute Council LHEES Strategy 94 10.4 Appendix D: LHEES Stage Descriptions Stage 1: Policy and Strategy Review A policy review was carried out to highlight national, regional and local policies that are linked to, impact, or could be impacted by LHEES. Results from this review, along with initial stakeholder mapping were logged in the policy review template for reference during subsequent stages of the LHEES. Stage 2: Data and Tools Library This stage involves identifying and maintaining a record of the data and tools used to support analysis in the subsequent stages of the LHEES process. The record captures data sources, ownership rights, requirements for the LHEES Considerations and data format. Stage 3: Strategic Zoning and Pathways The purpose of LHEES Stage 3 is to support local authorities to understand the current energy efficiency and heat decarbonisation performance of the building stock at a local authority wide level. It also supports further analysis to set out Strategic Zones and pathways for each LHEES Consideration, as far as reasonably possible, at data zone level, a commonly used standard for statistical reporting of socio-economic data. These Strategic Zones identify potential solutions for inclusion in the LHEES Strategy (Stage 7). The analysis sets out the strategic starting point for the generation and prioritisation of Delivery Areas (Stage 4), as well as further engagement and actions for the Delivery Plan (Stage 8). LHEES Stage 3 is supported by both the ‘ omestic Baseline Tool’ and the ‘Non-domestic Baseline Tool’. The Domestic Baseline Tool was developed by Zero Waste Scotland for analysis of the domestic sector drawing on Home Analytics as the core source data to support this. The tool was used to generate a performance baseline of buildings and to set out Strategic Zones with respect to the LHEES Considerations. The ‘Non-domestic Baseline Tool’ was developed following the release of Non-Domestic Analytics, as a means to support better understanding of the breakdown of non-domestic building typologies and by other criteria, such as age, heating system type or floor area category. Given the limitations of the non-domestic dataset, the outputs are focused on providing property count and / or total heat demand information for these groupings, rather than suggesting suitability for specific interventions. When assessing heat decarbonisation options in the tools, heat pump installation is one of the suggestions. According to the LHEES methodology, the level of heat pump ‘readiness’ in domestic properties are sorted into four categories: Building category Description Category 0 Currently have a low or zero direct emissions heating system, or heat network connection Category 1 “Heat pump ready” buildings that are well-suited to heat retrofit with minimal other changes. Category 2 Secondary potential for heat pump retrofit. Require some fabric and/or distribution systems upgrades.
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Argyll and Bute Council LHEES Strategy 95 Category 3 Significant upgrades required to be heat pump ready. In the standard Zero Waste Scotland methodology, Category 1 properties are assessed based on a range of indicators including wall insulation, glazing status, wet heating system and loft insulation prediction. For Argyll and Bute’s LHEES, only wall insulation was accounted for in Stage 3 given that this was the most relevant factor to the local domestic property stock. Stage 4: Generation of Initial Delivery Areas. Stage 4 is informed by the LHEES Strategy and analysis from Stages 1-3. The purpose of Stage 4 is to support the Council’s decision making by generating initial elivery Areas for each of the LHEES Considerations. This Stage uses GIS to generate initial Delivery Areas at a higher granularity than LHEES Stage 3, to enable the Council to understand specific locations of potential Delivery Areas within a Strategic Zone or across the whole local authority. The level of granularity is advised at 250m2 to reflect an appropriately sized delivery area without the risk of identifying individual properties. This analysis is the starting point for more detailed engagement, building level assessment of interventions and cross-checking against the policy and strategy review (stage 1) to enable finalisation of the Delivery Areas (LHEES Stage 6). These Delivery Areas should then support actions in the Delivery Plan (Stage 8) that are within the competence of the Scottish Government, local authorities and wider partners. Stage 5: Building-Level Pathway Assessment The purpose of LHEES Stage 5 is to support with delivery area identification of Stages 4 and 6 to establish in more detail the type of intervention(s) required to decarbonise the building from a heating and energy efficiency perspective. This stage provides an understanding of the costs and the energy and carbon savings associated with interventions. Stage 5 enabled South Lanarkshire Council to select and analyse domestic buildings for assessment in the Energy Saving Trust’s PEAT-OR, for the domestic sector only. PEAT-OR enables the local authority to evaluate energy efficiency and heat decarbonisation retrofit options in terms of costs and carbon emissions reduction. Results can be presented at the building level or at a zone level. The buildings to be evaluated can be selected and taken from the analysis in LHEES Stage 3 or Stage 4. It is recognised that PEAT-OR has not been designed specifically to support LHEES. Therefore, in this LHEES, a PowerBI report has been developed to enable the Council to explore potential decarbonisation results in an interactive and customised manner to assess viability and decision making of delivery areas. Stage 6: Finalisation of Delivery Areas During this stage, Strategic Zones, initial Delivery Areas and any building-level assessment were considered alongside the detail included as part of the policy and strategy review and all stakeholder engagement undertaken. The outcomes from this stage are documented in the stage 8 Delivery Plan.
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Argyll and Bute Council LHEES Strategy 96 10.5 Appendix E: Detailed Methodology for the Identification of Potential Heat Network Zones Analysis was undertaken to identify the areas where heat networks present a decarbonisation pathway that could be of strategic importance for South Lanarkshire. Heat Data Point non- domestic properties were filtered to only include semi-public and public buildings. These were refined using OS AddressBase classification codes identified as semi-public or public by the Green Heat in Greenspaces project. Additionally, a sense check of building names was carried out to identify Council-owned buildings. If that was the case, the buildings were added to analysis. This approach was chosen so that only non-domestic buildings that the Council has full or partial control over are treated as potential anchor loads in the heat network zoning. When defining anchor loads, public and Council-owned buildings have been prioritised as the Council has greater control over the operation of these buildings. Heat network zones have been identified based on a 4,000 kWh/yr/m linear heat density (a means of relating annual heat demand to a distance). Areas of greatest potential for heat network development have been further identified based on a solely heat demand perspective where at least two anchor loads were required > 500MWh/yr. Further analysis through feasibility studies and constraints analysis were required to understand the viability of heat network development in each identified area. Existing heat networks have been added to potential heat network zones to identify viability of heat network expansion. For the purpose of LHEES, a 500m radius buffer has been drawn around the existing heat network points to provide a sensible estimate of the area within which heat demand can serve. The methodology for identification of heat networks has been summarised in Figure 19. For a comprehensive methodology, please see the Heat Network Zoning methodology in the LHEES documentation.
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Argyll and Bute Council LHEES Strategy 97 Figure 19: Summary of the methodology for identifying heat network zones
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Argyll and Bute Council LHEES Strategy 98 10.6 Appendix F: Heat Network Opportunities from Argyll and Bute’s Pilot Study.
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LOCAL HEAT AND ENERGY EFFICIENCY DELIVERY PLAN Argyll and Bute Council July 2024
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2 Argyll and Bute Council LHEES Delivery Plan 2024 LHEES stages This LHEES has been developed over eight stages, as outlined in Figure 1. Completing stages 1-6 provided the data analysis and evidence base that forms the foundation for the Argyll and Bute LHEES Strategy (Stage 7) and Delivery Plan (Stage 8). Figure 1: Summary of LHEES Stages • The LHEES Strategy is a long-term strategic framework over the next 15-20 years for decarbonising heat in buildings and improving energy efficiency across Argyll and Bute, framed around the six considerations outlined below. Argyll and Bute Council’s LHEES Strategy is data-led and justifies the actions proposed. In short, this document demonstrates the direction the Council is moving towards. • The LHEES Delivery Plan accompanies the strategy. The plan will be flexible and iterative, outlining how the Council will implement its strategy over the next five years. It will outline the areas requiring further analysis and investigation and identify low or no-regret measures for decarbonising heat in buildings. It provides a focus for the Council to consult with and work with stakeholders to deliver the LHEES strategic objectives. Both documents will be reviewed and updated periodically to reflect legislative changes, progress towards net zero, new available technologies and funding, and changing priorities in the local authority. Argyll and Bute Council’s LHEES Strategy and Delivery Plan can be found on Argyll and Bute Council’s website. Stakeholders A variety of methods were employed to engage stakeholders in developing the priorities for the LHEES and are set out in detail in the LHEES strategy document. Stakeholders will also play a crucial role in implementing the actions and proposed solutions. Further engagement will take place with stakeholders to develop these proposed actions.
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3 Argyll and Bute Council LHEES Delivery Plan 2024 The LHEES delivery plan is flexible and iterative to capitalise on emerging opportunities and to allow the LHEES to support and enhance other relevant work in Argyll and Bute. Local authority’s LHEES priorities The Council has identified eight priorities for the LHEES: 1. Addressing grid capacity 2. Decarbonising heat sources 3. Challenging fuel poverty 4. Building sustainable and energy-resilient communities 5. Ensuring a “Just transition” to net zero. 6. Tackling supply chain constraints and shortage of skills 7. Improving education and awareness of decarbonisation requirements and solutions 8. Advocating a fabric-first approach to ensure buildings are heat pump-ready. Next Steps The next step is to establish a stakeholder implementation group. This group will further develop, revise, and adjust the proposed actions and solutions set out below. This important task will enable stakeholders to take ownership of delivering specific actions, setting targets, and specifying timelines to achieve them.
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4 Argyll and Bute Council LHEES Delivery Plan 2024 Overarching priority - Improve the accuracy of data. Action Description Who Obtain more accurate data to better inform future iterations of the LHEES Collaborate with local communities, council services, organisations, agencies, and researchers to acquire precise data concerning the implementation of energy efficiency measures and the assessment of heat demands instead of relying on modelled data. The next steps are to: • Identify and acquire relevant data sets which are now being collected by national organisations, such as Ordnance Survey’s building data set. • SSEN and SPEN are also collecting new data sets. • Utilise the findings from the Community Planning Partnerships – Regional Climate Change Plan call for evidence. • Obtain data from BARs. • Consider incorporating gathering data through existing mechanisms such as: o CHAT o NPF4 Local Place Plans • Undertake bespoke research projects to fill data gaps. Local communities, Council services, Community Planning Partnership HIE ALIenergy Researchers AMAZE project. Islay Carbon Neutral Islands Project Iona Heat Network research project Isle of Mull Energy Audit Oban Energy Plan, etc
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5 Argyll and Bute Council LHEES Delivery Plan 2024 Priority 1 and 2- Decarbonising heat and addressing grid capacity. Action Description Key Stakeholders Retrofit Private Housing Stock Support PRS tenants and homeowners to transition to a low or no-carbon heat source. Ensure Landlords are aware of their decarbonisation obligations following the enactment of the HIBS Bill. Enhance the promotion of • Warmer Homes Scotland programme • ECO and ECOFLEX Encourage eligible homeowners and tenants to sign up for these programmes. Develop/identify an appropriate toolkit for homeowners to assist them on their decarbonising journey. Landlord Registration Team ABS Team LHEES Officer Retrofit Social Housing Stock RSLs continue to decarbonise the heating source of their housing stock. RSLs are currently decarbonising their stock to comply with EESSH/ EESSH2. In the future, RSLs must adhere to the SHNZS once it is enacted. RSL’s Heat Networks Evaluate the feasibility of the proposed heat networks described in the LHEES strategy. Conduct feasibility studies to determine which Heat Networks are viable. Identify housing sites which are near the potential heat networks outlined in the LHEES strategy. Collaborate with Registered Social Landlords (RSLs) and other developers to share the expenses of infrastructure works. This collaboration may reduce the implementation costs and make another wise, unviable network viable. Explore potential options for heat network delivery models. Develop a business case for feasible heat networks. RSLs LDP Team LHEES Officer The Rural Growth Team Technical experts Potential investors
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6 Argyll and Bute Council LHEES Delivery Plan 2024 Heat Networks Prioritise viable heat networks and support the implementation of the most viable ones. Some heat network projects will already have potential investment streams, such as the Islay and Campbeltown networks. The LHEES Officer Technical experts Potential investors The Rural Growth Team Heat Networks Carefully evaluate the benefits and drawbacks of formally designating Heat Network Zones. If the Council decides to designate HNZ, then the Council will: • comply with the Heat Networks (Scotland) Act 202 requirements. • Use planning policy to designate Heat Network Zones in the Local Development Plan. The LHEES Officer Council Elected Members and Senior Staff The LDP team Heat Networks Promote and facilitate the implementation of shared ground loop opportunities. As part of the LHEES process, research and analysis were undertaken to determine the viability of share-ground loop projects within Argyll and Bute. This desktop research project will be developed further by undertaking the following: • Determining the level of interest among stakeholders regarding the advancement of potential opportunities. • Conducting additional research to ascertain the feasibility of projects that have generated interest. • Support stakeholders in obtaining resources to implement these small-scale heat networks. LHEES Officer Technical experts Stakeholder groups, organisations, businesses and individuals. Grid Constraints Identify areas with available grid capacity and prioritise projects in these locations. We will engage with both Distribution Network Operators (DNO) to assess the implications of individual heat pump installations on the local grid. We will use SSEN and SPEN project planning tools to determine where grid capacity would allow decarbonisation projects to occur. LHEES Officer SPEN SSEN Grid Constraints SSEN’s LENZA tool identifies areas where there are grid constraints. Overlaying this data LHEES Officer SPEN SSEN
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7 Argyll and Bute Council LHEES Delivery Plan 2024 Identify the LHEES priority areas impacted by grid constraints. with GIS maps outlining the LHEES priorities provides a visual representation of the area requiring urgent grid infrastructure enhancements. The Council needs to have access to a similar tool for the SPEN area. Grid Constraints Develop plans and investment streams to resolve grid constraints in LHEES priority areas. Enhancing the grid infrastructure in urban and rural areas is essential to facilitating the transition to decarbonised heat and preventing rural areas from being marginalised or left behind. Support Distribution Network Operators (DNOs) to secure investment in grid infrastructure for the priority areas outlined in the Local Heat and Energy Efficiency Strategy (LHEES). Collaboration and dialogue among the Council, the Scottish Government, and DNOs are integral to accomplishing this target. ABC Senior Management SSEN SPEN SG Decarbonisation Pathways Consider how locally generated electricity that cannot be exported to the grid could be utilised. Consider how this surplus electricity can be used, for example: • Distributed locally to fulfil local energy needs • to create thermal stores, • for battery storage and • for producing green hydrogen. All of which could be utilised locally to provide low-cost clean heat. ABRA Economic Development LHEES Officer Energy generators Decarbonisation Pathways Investigate decarbonisation pathways using emerging technologies or existing technologies in new ways This will include: o Identify potential opportunities for local generation and distribution o Explore solar potential. o Explore hydrogen and what solutions can be provided by the Argyll Hydrogen Hub o Demonstration projects such as hydrogen and gas mix o Thermal stores Climate Change Manager LHEES Officer Economic Development
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8 Argyll and Bute Council LHEES Delivery Plan 2024 o Industrial-sized electric battery stores such as Annan Distillery o Smart grid solutions o Keep up to date with novel solutions through conferences, workshops, reports, and research findings, as well as maintain relationships with the industry. Decarbonisation Pathways Implement energy efficiency measures in non-domestic Council assets. Identify the required decarbonisation pathways for council assets. This could be achieved by expanding the Non- Domestic Energy Efficiency Fund to decarbonise further council assets. Climate Change Manager Climate Change Board Decarbonisation Pathways Continued enaction of the Council’s Decarbonisation Plan The council will utilise the Decarbonisation Plan to determine the prioritisation of assets for investment. Climate Change Manager Climate Change Board PRIORITY 3, 4 and 5- Sustainable energy-resilient communities fuel poverty and a just transition. Action Description Key stakeholders Sustainable energy reliance communities Enhance community resilience by encouraging communities to formulate localised “place-based” energy decarbonisation plans. Promote examples of good practice, such as the AMAZE and Zero Carbon Islay community energy plans. Also, investigate if there are opportunities to incorporate heat decarbonisation plans into other community plans, such as: • NPF4 (place-based plans) • CHAT plans(community-led housing plans) • Community Planning Partnership (place plans) LDP Team Housing Services Community Planning Partnership Community Trusts and Organisations Economic Development Sustainable energy reliance communities Explore mechanisms enabling communities to maximise energy generation benefits in their area. I.e. promote Community wealth building could include: • Establishing local energy distribution projects. • Providing cheaper, cleaner energy. Economic Development LHEES Officer
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9 Argyll and Bute Council LHEES Delivery Plan 2024 community wealth building. • Providing communal heating projects. • Creating high-quality jobs in the green economy. Just Transition Identify suitable decarbonisation approaches for remote rural and island communities. When formulating decarbonisation policies and strategies, policymakers must consider the specific requirements of remote, rural, and island communities. For instance, it's essential to ensure that regulations such as the HIBs bill and the Building Control regulations allow biomass to be used in rural areas. This would facilitate the shift from fossil fuels to this carbon-neutral energy source. ABC senior management LHEES Officer Elected Members SG A Just Transition To ensure that the move to net zero is fair and equitable. The price individual building owners must pay to connect to a low or no-carbon heat source is determined by the building’s location. In heat-dense communities, building owners are attractive to heat network investors, resulting in low or no- cost connections to decarbonised heat. Conversely, building owners may face significant costs to connect to a decarbonised heat source in non-heat-dense areas. Therefore, additional support will be necessary for these communities. For example, one solution could be to provide grants to communities where there is a lack of desire to invest in heat networks. SG A just transition Maximise funding and investment in remote rural and island decarbonisation projects. To enhance access to funding and investment for project delivery, it is essential to: • Raise awareness of the existing funding sources • Seek out alternative funding sources to strengthen retrofit/heat decarbonisation efforts Economic Development LHEES Officer
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10 Argyll and Bute Council LHEES Delivery Plan 2024 • Find ways to use existing funding more effectively • Improve opportunities for external investment in heat decarbonisation projects. It is imperative to take proactive measures to prevent the exclusion of remote rural and island communities from funding opportunities due to their high capital costs. This can be achieved through the following steps: • Ensuring that funding entities are well-informed about the underlying reasons for the high capital costs faced by remote rural and island communities. • Advocating for an equitable allocation of resources. • Outlining the restricted opportunities for private investment attributable to the lack of heat density in these areas. Scottish Government and other funders Fuel poverty Prioritise installing heat networks or heat pumps in homes that use direct electric heating. A targeted focus on households dependent on direct electric heating represents an opportunity to alleviate fuel poverty. This is attributable to the cost-effectiveness of heat pumps and heat networks compared with direct electric heating systems. RSLs Landlords Homeowners Fuel poverty Focus on homes where poor energy efficiency contributes to fuel poverty. Buildings with substandard insulation require more heat to maintain a comfortable temperature, resulting in higher heating costs. This increased energy demand can lead to households falling into fuel poverty. Prioritising these properties will help alleviate fuel poverty. ABS Child Poverty Forum LHEES Officer
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11 Argyll and Bute Council LHEES Delivery Plan 2024 PRIORITY 6- Fabric first approach- getting buildings heat pump ready. Action Description Who Energy Efficiency Measures Engage with private sector building owners and tenants to encourage greater adoption of energy efficiency initiatives. Increasing uptake of energy efficiency measures may be achieved by: • Raising awareness of the ABS, ECO and ECO flex programmes • Promoting case studies and good news stories to demonstrate tangible benefits. ABS team Energy Efficiency Measures Signposting structures are in place to enable building owners to identify potential resources to fund energy efficiency works. Not all building owners qualify for ABS or ECO funding and may require guidance on accessing funding. Local and national awareness campaigns are necessary to inform building owners about financing options for energy efficiency measures. (See awareness raising section of the plan) SG ABC Energy Saving Trust Home Energy Scotland Energy Efficiency Measures in Mixed Tenure Properties Engage with stakeholders in mixed- tenure properties to implement energy- efficient measures for the entire building. When property owners or residents make inquiries about or receive funding from schemes such as the Argyll and Bute Council’s Scheme of Assistance, then the council would recommend that energy-efficiency measures should also be implemented within buildings. Undertake tailored initiatives such as the Warmer Homes project in Tarbert. This mixed-tenure structure received funding from the Warmer Homes Scotland initiative to address sections occupied by social rented tenants. However, the scheme did not extend to tenants in the private rented sector (PRS) and owner- occupiers. To address this disparity, the council pursued funding from the Special Project Fund under the Area Based Scheme. This allocation covered the financial contribution that would have been required from tenants in the PRS and homeowners to ensure comprehensive treatment of the entire building. Housing Team RSLs
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12 Argyll and Bute Council LHEES Delivery Plan 2024 Priority 7- Tackling the skills gap and improving the supply chain. Action Description Who Skills and Supply Chain Support the development of the supply chain while also identifying the essential skills required for implementing energy efficiency measures and heat decarbonisation. Additionally, it facilitates skills development in these specific domains. Build on the recommendations identified by Historic Environment Scotland following their skills audit in Argyll and Bute. Historic Environment Scotland advised that professionals in education, alongside Skills Development Scotland, should advocate for construction careers as a favourable career path for school students. They also proposed that schools introduce vocational courses to provide students with practical exposure to such careers. Increase the number of apprenticeships in decarbonisation-related roles to alleviate the skills shortages. Identify and address the underlying causes of low enrolment in locally offered decarbonisation and renewable energy courses. Build on Argyll and Bute Council's "Grow your own" scheme to upskill local people and enable them to fill these skills gaps. Collaborate with the Argyll and Bute Skills Development Partnership to establish a skills pathway for local individuals employed in other employment sectors, facilitating their smooth transition to roles within the green economy. For Business Development and Economic Development services to work with existing construction and heating businesses to develop an approach that Education service Skills Development Scotland (SDS) HIE Argyll College Various teams with Argyll and Bute Council Skills Development Partnership LHEES Officer
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13 Argyll and Bute Council LHEES Delivery Plan 2024 enables employees to upskill and equip them with the necessary skills to pursue emerging opportunities within the green economy. Participate in national discussions regarding skills gaps in decarbonisation and identify best practices and successful approaches. Implement the identified solution in Argyll and Bute or adapt it to suit the local context. Priority 8- Knowledge and Awareness Action Description Who Raise awareness of the LHEES Continue to provide workshops and training sessions on the LHEES. LHEES Officer The community knows it needs to decarbonise Enhance the community's knowledge and consciousness of the necessity to decarbonise. Emphasising the localised impacts of climate change and delineating the necessity of strategies for both mitigation and adaptation is essential to motivate individuals to decarbonise their heat sources and decrease their energy consumption. Community Planning Partnership’s Climate Change Project Manager Various Council services Other third-sector and community organisations Community Groups Individuals Business decarbonisation requirements Increase engagement with the business community to raise awareness of energy efficiency and heat decarbonisation requirements. Ensure that business representatives are aware of the legislative requirements, the tools available to assist them in decarbonising, and the financing options to facilitate this transition. Business gateway Argyll and Bute Council business support team Federation of Small Businesses the Chamber of Commerce Council Staff and Elected Officials consider the carbon implications of their decisions. Increase the number of Council staff and Elected Members who have completed carbon literacy training. For the Council to move from bronze to silver carbon literacy accreditation. Elected Members Council Staff
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14 Argyll and Bute Council LHEES Delivery Plan 2024 Elected Members and Council staff have knowledge and awareness of why it is imperative to decarbonise and have pledged to decarbonise. To continue participating in conferences, workshops, and training courses to improve and enhance knowledge of energy efficiency and heat decarbonisation. Meet with practitioners from industry to improve knowledge and understanding of heat decarbonisation and energy efficiency. Bespoke advice Businesses, the community, and individuals can access bespoke advice on decarbonising heating and improving energy efficiency measures tailored to their buildings. Signposting to Home Energy Scotland for bespoke energy efficiency and heat decarbonisation advice and information about funding. Signpost to EST, who can provide information about renewable technologies and case studies of early adopters. Investigate the tools available on the market that provide bespoke advice on decarbonisation and energy- efficient measures for specific buildings. Evaluate how businesses, community organisations, and individuals can use these tools and what safeguards must be established. EST HES Various Council Services LHEES Officer Knowledge of decarbonisation programmes Continue to collaborate with RSLs to ensure they are aware of the support available to decarbonise their stock. Promote and circulate information regarding programmes and initiatives which implement energy efficiency measures or install technologies to decarbonise heat to: • The Argyll and Bute Strategic Housing Partnership, • The SHIP Officers Group and • Argyll ad Bute Energy Efficiency Forum RSLs Housing Services Knowledge of decarbonisation programmes Increase knowledge and awareness of energy efficiency and heat decarbonisation support to PRS Continue to promote ABS programmes to owner-occupiers and tenants in the PRS. Promote ECO, existing grants and loans and other relevant programmes that become available to owner- occupiers and PRS. ABS team
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15 Argyll and Bute Council LHEES Delivery Plan 2024 tenants and owner occupiers. Knowledge of decarbonisation programmes Increase knowledge and awareness of energy efficiency and heat decarbonisation support to non- domestic building owners. Promote existing and new programmes as they become available to non-domestic building owners to support them in improving energy efficiency or decarbonising their heat source. Business gateway Argyll and Bute Council business support team Federation of Small Businesses the Chamber of Commerce Refuting misconceptions Refuting misconceptions surrounding heat pumps. Signpost to case studies of early adopters of heat pumps and promote local success stories. Various Council Services Community Planning Partnership Climate Change Project Manager RSLs Other third-sector and community organisations
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16 Argyll and Bute Council LHEES Delivery Plan 2024 Appendix 1: Abbreviations Acronym Description CPP Community Planning Partnership DNO Distribution Network Operator ECO Energy Company Obligation EES Energy Efficient Scotland EESSH Energy Efficiency Standard for Social Housing EPC Energy Performance Certificate EST Energy Saving Trust GIS Geographic Information System HA Housing Association HES Home Energy Scotland HES ? Historic Environment Scotland HIE Highlands and Islands Enterprise EESABS Energy Efficiency Scotland: Area Based Schemes ABS Energy Efficiency Scotland: Area Based Schemes INTOG Innovation and Targeted Oil and Gas Leasing LA Local Authority LDP Local Development Plan LHEES Local Heat and Energy Efficiency Strategy LES Local Energy Scotland LPG Liquefied Petroleum Gas
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17 Argyll and Bute Council LHEES Delivery Plan 2024 OGG Off Gas Grid PEAT Portfolio Energy Analysis Tool PRS Private Rented Sector RSL Registered Social Landlord SHIP Strategic Housing Investment Programme SHNZS Social Housing Net Zero Standard SPEN Scottish Power Energy Networks SSEN Scottish and Southern Electricity Networks SDS Skills Development Scotland WHS Warmer Homes Scotland