Infrastructure and Capital Investment Committee

Meeting date: Wednesday, February 27, 2013

Official Report 571KB pdf

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“Low Carbon Scotland: Meeting our Emissions Reduction Targets 2013-2027”

We move on to agenda item 3—ministerial evidence on RPP2—which will be split into two sessions. The first session, which is on transport, will be with Keith Brown, who is the Minister for Transport and Veterans, and the second, which is on housing and procurement, will be with Margaret Burgess, who is the Minister for Housing and Welfare. I welcome, with Keith Brown, Jonathan Dennis, who is economic adviser to Transport Scotland, and Dr Katherine Falconer, who is head of the sustainable transport team at Transport Scotland. I invite the minister to make some opening remarks.

I thank you for the invitation to talk to the committee about the transport element of the draft second report on proposals and policies for meeting Scotland’s climate change targets.

As members know, in 2009 the Parliament voted unanimously to pass the Climate Change (Scotland) Act 2009. Since then, we have been working together to lay the foundations for what we all hope will be a genuine and sustainable transition to a low-carbon economy and society.

The draft RPP2 sets out options and recognises the uncertainties that are inherent in looking forward across the next two decades. Our ambition is that, by 2050, Scotland will have a largely decarbonised transport sector, and that significant progress will have been made towards that by 2030.

To achieve that, we need to develop a long-term strategy in the context of steadily evolving technologies and behaviours. That is why it is appropriate that the transport chapter focuses on the broad approach of how we want to reduce emissions from transport. It sets out four core packages of proposals; they relate to decarbonising vehicles, encouraging behaviour change and promoting sustainable communities, engaging with businesses on sustainable transport, and ensuring efficient use of the road network. That builds on the approach that was set out in RPP1 and ensures consistency across the two documents. We are using all the levers that are available under our devolved powers and resources to tackle the challenge of transport emissions abatement. It is a highly ambitious agenda and we are building momentum—laying the foundations, as it were—in the early years.

Rightly, the report builds in flexibility in deciding which proposals should be adopted and which options should be held in reserve. We need flexibility. The Scottish Government’s resource budget for the period between 2010-11 and 2014-15 has been cut by 7.7 per cent in real terms, and the capital budget has been cut by 26 per cent. The challenge of finding ways of funding action on climate change is considerable.

As far as the transport contribution to the low-carbon agenda is concerned, we are continuing to invest in sustainable transport and to support climate change action. Considerable work is under way on a broad range of fronts, in line with what is set out in RPP1. Work is being done on modal shift to active and public transport and to rail and water transport for freight, as well as on new technologies such as low-carbon vehicles and hybrid buses.

In the current spending review period, we have committed substantial funding to reducing the carbon impact of transport; more than £200 million is being spent between 2012-13 and 2014-15. The Scottish Government funding is only part of the story. There is a shared agenda, and collective action across the public and private sectors is needed.

To that end, we are working in partnership with a range of organisations and are pulling in matched funding from local authorities and the private sector to increase leverage. A highly significant example of that is the E-cosse partnership, which we established to develop and support the strategic direction in relation to our core aim of decarbonising vehicles in the coming decades. That work is also about getting economic benefit from such developments, by producing or developing things in Scotland.

We are actively supporting the Aberdeen hydrogen project in a partnership that involves Scottish Enterprise and industry, and the cycling action plan for Scotland is very much a partnership endeavour, which relies on local authorities and others playing their part.

Beyond our specific work on low-carbon transport, we are of course continuing to implement a programme of wider infrastructure investment that is geared towards supporting sustainable economic growth in Scotland, which will encourage modal shift to public transport and active travel. We are investing £1 billion annually in public transport, which will support modal shift from cars.

We are committed to fastlink in Glasgow—we will provide up to £40 million over the life of the project—to supporting the modernisation of the Glasgow subway, the figure for which I think is around £300 million, and to supporting the Edinburgh trams, as well as to work to do with park and ride and dedicated busways, which is linked to the Forth replacement crossing.

Last June, I announced a £5 billion package of funding and investment in Scotland’s railways between 2014 and 2019, which includes a commitment to further electrification of the rail network. Work has already started on the Edinburgh to Glasgow rail improvements programme and on enhancements to the Highland main line between Perth and Inverness and to the line between Aberdeen and Inverness. The Borders railway is scheduled to open in 2014-15 and is expected to take 60,000 peak trips off roads in the Scottish Borders and Midlothian every year. It is worth pointing out that that project will increase emissions in the short term, as many construction projects do, but it will achieve that reduction in peak trips on the roads.

Achieving significant emissions abatement from transport is a very long-term agenda. We are setting out the foundations for far-reaching transitions to low-carbon transport over the coming decades. In the meantime, we will continue to track and appraise progress, and to develop interventions accordingly.

Thank you very much.

You mentioned a wide range of projects. Can you measure how much reduction in carbon emissions they have resulted in since the publication of RPP1?

RPP1 was published in March 2011. Emissions data for transport and for the other sectors in Scotland is available only up to 2010. That shows that emissions from transport fell for the third year in a row and are 1.4 megatonnes below the 2007 peak of 14.65 megatonnes, which represents a fall of around 10 per cent from that peak.

It is important to remember that the figures that were set out in RPP1 were abatement estimates—not targets. The only targets are the annual targets for emissions reductions that are set by Scottish ministers under the Climate Change (Scotland) Act 2009, and we monitor progress against them. Those are not sector-specific targets—they apply to the whole economy.

It is worth reiterating that it is an extremely long-term agenda and that transport’s contribution to emissions reduction will be more pronounced in future decades, not least because we are trying to change behaviours, as I have described. Transport is a highly significant area, but we are at the stage of laying the foundations for the future changes that we want. Given that it is less than two years since RPP1 was published, many of the proposals and policies that it set out remain in RPP2, as you would expect. Each chapter includes a summary of the highlights of progress to date. I mentioned the setting up of the E-cosse network to support the transition to low-carbon vehicles, but I did not mention the setting up of the Scottish green bus fund, which is a key part of that. We have also engaged in a partnership with Scottish Enterprise on the Aberdeen hydrogen project.

10:15

At the early stages, when we are looking to back the right new technology to produce the maximum dividends, there is an element of simply having to see how things develop. For example, hydrogen could be hugely significant in carbon reduction. I am aware of one development in the south-west of England—in Bristol, I think—where a ferry has been converted to hydrogen power. It was so successful in reducing the weight of the vessel that further ballast had to be put in, following the removal of the traditional diesel engine. That brings a huge benefit for climate change targets.

The point is that there is no regulatory framework at this stage for that kind of development—for testing and regulating hydrogen-powered ferries, for example. The purpose of that project was as a pipe-cleaner, as it is called—going through one process to help establish a future process. I mention that to underline the fact that we are at the very early stages of some developments.

The received wisdom on hydrogen tends to be that it is more suitable for larger vehicles or vessels, which is why the mainstay of the Aberdeen project is buses. I have seen video footage of a hydrogen-powered car. One of the fears that people might have is about what would happen if there was a fire. When we see what happens to a hydrogen-powered car in a fire, it is far less damaging. In fact, the car is virtually unscathed—the fire comes out in a kind of stream. We have to get beyond the perceptions about hydrogen.

I mention that to illustrate the fact that we will simply have to see how the technologies develop over time. We have invested substantially in electric vehicles, but we will have to see how they develop over time. We must retain the flexibility to move investment and proposals around to reflect how the technologies are developing.

If I understand you correctly, we do not have enough up-to-date data to see how emissions reductions are faring against RPP1. I am not clear about what procedures are in place to monitor emissions reductions that are a direct result of the policies that you have mentioned.

There is a lag between getting the information and seeing what the impact is—I think that that is the point that you are making. For example, the figures that are available now cover the period up to 2010. Other data exist—albeit that they do not yet have the status of official figures—and they give us an idea of how things are progressing. The figures that are available up to 2010 show a reduction from the peak.

We also have carbon accounts for many of the big projects that we do, which give us an idea of the carbon impact of those projects.

Last week, witnesses raised the point that the transport chapter of RPP2 has a lot less detail on predicted emissions reductions for individual policies and proposals than RPP1 did. Could you explain why?

That is because of some of the reasons that I have already mentioned. One of the ways in which we want to effect carbon emissions reduction is to back new technologies; another is to change behaviours. Those things take time and are less easy to measure at the early stages. Whether it is a change to eco-driving or a modal shift, it takes time to effect changes to behaviour, which perhaps accounts for why things are more generalised at this stage. The timescale that RPP2 covers—up to 2027—is very long, and there is a high level of uncertainty about what will be the most effective policy interventions.

Across the world, we are moving into new areas in climate change in general. We in Scotland have set the most ambitious targets, and others have started to catch up by setting similar targets. It is a huge challenge, and the process lasts a long time.

We have concentrated on broad packages of interventions rather than more detailed accounts, not least because we do not at this stage know how quickly things will develop; for example, one could invest in a particular electric vehicle and find that is superseded by another within six or 12 months.

It is right to concentrate on the broad packages and to put in place the foundations to ensure that the behavioural change and any benefits from technological change can be maximised. However, we cannot always specify that at the start.

Are you saying that there was more detail in RPP1 because the timescale was shorter and more immediate so you felt more able to predict whether you could achieve the targets?

We obviously know more than we did then. The best approach for us to take is to develop broad packages and say what areas we should concentrate on—which are the four areas that I mentioned.

However, we must allow ourselves flexibility. That does not represent, and should not be taken as representing, any reduction in our commitment to achieve the targets. It simply seems to us from the work that we have done to try to change behaviours, to effect cultural change and to back the right technologies that we need such flexibility.

One of the other concerns that was raised with us was that the two policies in RPP2 are both delivered by the European Union and the elements that will be delivered by the Scottish Government are only proposals. Will you comment on that? Would you be prepared to consider upgrading some of your proposals—possibly, eco-driving training or the smarter choices, smarter places project—to policies?

The fact that the two policies are based on the EU vehicle emissions standards directives simply recognises the fact that the directives will play a substantial role, not least because of the international context of vehicle production. We support the EU’s efforts to create levers on that.

However, we are taking substantial action ourselves. There is on the market an electric car, much of which can be manufactured, or at least assembled, in any country in the world that chooses to produce it—indeed, the batteries for it are produced in Scotland. It complies with all the EU directives, and we think that it is a good thing to have those directives as the mainstay. The bias towards proposals reflects the fact that the scale and nature of the programme will depend, as it unfolds, on spending decisions that will be made in future spending rounds.

We are developing policies and proposals in an adaptive way that sets out a clear direction. It also allows us to be responsive to a fairly fast-changing technological environment.

The draft RPP2 attempts to balance the need for a long-term credible plan to meet our emissions targets, with the need to remain flexible. It is perfectly appropriate to have that mix of policies and proposals; the Climate Change (Scotland) Act 2009 provides for that mix. It is also important to have flexibility. However, the scale and nature of the programme will depend on spending decisions.

Many of the proposals contribute to continuing Scottish Government policy work. For example, on cycling, we are approaching about £20 million of Scottish Government money in 2013-14 for modal shift, as I mentioned.

We think that the balance is right, but the last part of the question was about whether we should consider a change. Elaine Murray mentioned two examples. We intend to be responsive and to continue to listen. If it seems appropriate to us to change a proposal into a policy, we will do that.

There is also a question of scale. The scale of the two EU policies is much grander than that of some other examples that we could give. That is why we have them in RPP2 as policies.

I refer you to table 7.7 of the report, which is the abatement summary for transport, and page 165, which sets out year-by-year abatement targets. Some of the witnesses were unhappy at the line “Lower Emission Potential in Transport”, which was a string of zeros until 2025, after which significant annual reductions were predicted—250,000 tonnes, and up to 750,000 tonnes by 2027. Will you explain that pattern? Where will the huge reductions in the late 2020s come from?

I will try my best to explain that. There are a number of additional technical points. I had a brief discussion about the matter with Paul Wheelhouse, who has just gone into the room next door to give evidence to the Rural Affairs, Climate Change and Environment Committee, and he helped me to understand some of the science behind the abatement targets.

The RPP2 covers a period of up to 14 years from now and there are inherent uncertainties in predicting technologies and costs over that period. I have said that a number of times; it is key in terms of transport. Even in the relatively short time for which I have been doing my job, we have seen substantial changes in technology, especially in low-carbon vehicles. We based the analysis of abatement on what is technically feasible—notwithstanding the uncertainties that I mentioned. We do not believe that we should put in place definitive proposals to achieve further reductions well into the future because we cannot know the technical and policy contexts that will apply up to 14 years from now. In the future, there might be more effective and economical ways in which we can meet the targets, but those are not yet known to us.

However, the proposal gives us the assurance that the targets can be met in principle. In the future, we could be talking about stronger incentives, but that will be for future consideration. We intend to carry out further analysis and to develop a proposal on how we may realise the abatement potential in the next RPP. That is the right approach to take.

As I have mentioned before, transport is different from the other areas in relation to effecting behavioural change and anticipating technological developments. That perhaps accounts for some of the figures in the abatement targets, along with the less certain route for achieving those things.

For example, manufacturers are putting large amounts of effort and research into development of low-carbon vehicles. There is an often-expressed criticism that we have more charging points than we have electric vehicles—everyone has a go about how many electric vehicles there are—but it is simply a statement of fact that we will not get a big upswing in electric vehicles until we have the infrastructure in place for them. We have to put the infrastructure in place now, and we will see the fruits of that in future years.

That might help you to understand some of the targets.

So there will not be any progress in terms of lower emissions potential in transport between now and then. Basically, you are discounting that over the next 10 to 15 years. Is that really what you are saying?

I will let Katherine Falconer come in on the point, but we are not discounting that. We are focused on the fact that we can achieve real progress. We think that we are achieving progress in the interim period in reducing emissions. That can be done in a number of ways. I mentioned low-carbon vehicles, but it can also be done by getting modal shift from both car and plane to train. That is why we are investing £5 billion over the control period to try to make the best possible progress in making railway services more attractive to people. Also, railway services will become more environmentally friendly through the electrification process that I have outlined.

It is not the case that we will not be doing anything in the meantime; a great deal is going on. However, the fruits of much of what we are doing will be seen in future years because of the nature of transport infrastructure, behavioural change and technological development.

We could probably demonstrate progress on a range of fronts in relation to the milestones in the first RPP. For example, there is a lot of on-going investment to expand the cycling infrastructure as well as to increase the numbers of children who go through cycle training in schools. We saw a small reported increase in cycling journeys and an increase in cycling mileage in the traffic estimates.

We are laying the foundation for an LCV and electric-vehicle charging infrastructure through the E-cosse partnership and we are seeing an expansion of the Scottish fleet and a growing number of electric vehicles across Government and elsewhere in the public sector in Scotland; we have funded 270. By this summer we should have a network of more than 500 double-outlet charging posts throughout the country, of which 300 will be publicly available.

10:30

On travel planning, the smarter choices, smarter places programme has now been concluded and the results will undergo a full evaluation later in the year, which will provide a springboard for further action in the coming years.

My next question is on the difference between RPP1 and RPP2; perhaps you have answered it already, but I am asking you for the record.

Stop Climate Chaos Scotland highlights that the transport emissions reduction targets in RPP2 represent just 65 per cent of the savings that were predicted in RPP1. Can you explain why that is, given that the policies and proposals that RPP2 sets out are effectively unchanged from those in RPP1?

We think that they are the right proposals, and the work that we have done since RPP1 through workshops with stakeholders and others confirms that we are pulling the correct levers. We are working across a broad range of different policy fronts; I mentioned the four packages in my opening statement.

Our understanding is that the likely effectiveness of those specific emissions reductions measures is developing all the time. RPP2 reflects our latest thinking, but it is obvious that things change over time and will continue to change as the data improve.

The important thing is that the total package of policies and proposals shows how the emissions targets can be met. We have used the best available data and modelling techniques in our analysis, although in some instances there is very little Scotland-specific data. Work is on-going to improve the data and the models that we use in order that we can develop our analysis further.

The transport emissions forecasts for the abatement activity that we describe in RPP2 are broadly in line with the profile that has been suggested by the UK Committee on Climate Change, which acts as our independent adviser. Although the forecasts have not been defined by individual sector, the committee has estimated that the savings from transport could reach 4 megatonnes by 2030, which it has estimated would put us on the right pathway to meet the 2050 target.

We have to recognise the realities of the economic situation. For example, turnover in the Scottish fleet of cars has slowed quite dramatically as a result of the reduction in household incomes and, as I mentioned, the spending reviews have had an impact on our ability to invest. Some of the changes in thinking reflect those realities.

Our thinking has been developing all the time, since we produced RPP1 at the beginning of the process. In order to measure the effectiveness of particular interventions, we must have a suitable database, and we are currently working on that. We are very much at the start of that process, but we expect to see dividends from it further down the line.

It was interesting to hear some of the things that were said with regard to the lower emissions potential in transport post-2020, but I want to talk about the milestones that have been set for 2020. Can you provide us with a progress update on where we are in meeting the 2020 milestones that RPP2 sets out?

In RPP1, we set milestones for 2020, one of which was the development of a mature market for low-carbon cars that would result in average efficiencies for new cars of less than 95g of CO2 per kilometre. We also mentioned the development of an electric vehicle charging infrastructure in Scottish cities. Alex Johnstone may be aware of our recent work on that, which has been quite heavily publicised—we are expanding substantially the number of charging points, not just within cities but between cities, and not only in public sector organisations but in private sector organisations. One of those organisations is the company that provides the batteries for many of those vehicles, which is based in Dundee. We are also working with SSE on a commitment to put in charging points free of charge at people’s homes. That is a pretty dramatic change.

In RPP1, we set out milestones on providing personalised travel planning advice to all households and on effective travel plans in workplaces with more than 30 employees. We have been bold in setting out a highly aspirational aim with significant challenges.

In relation to the milestone for low-carbon vehicles and electric vehicle charging, we have formed the E-cosse working group, which is made up of a variety of major stakeholders, such as WWF, power utilities and the electric vehicle industry. I repeat that it has two functions: to maximise the uptake of electric vehicles to meet the milestone and to maximise the economic benefits in Scotland from being at the forefront of developing electric vehicles.

We are in the third year of funding a programme for Government electric hybrid vehicles across Scotland. We have funded the uptake of around 270 of them, and the spend is a combined total of £8.5 million. We are aiming for a network of more than 500 double-outlet charging posts by summer this year, with 300 being publicly available across Scotland. The low-carbon vehicle agenda benefits in capital investment from the plugged-in places programme for electric vehicle infrastructure. That is a United Kingdom initiative, which we plug into, if you like. We also utilise support from the office for low-emission vehicles. That support was £1.8 million in the past year, and it will be £1.5 million in the coming year.

There is another milestone for travel planning. The smarter choices, smarter places demonstration programme is now undergoing a full evaluation, following which we will determine the next steps for it. Work is also under way with businesses through Scotland’s climate 2020 group.

We are constantly developing initiatives and taking opportunities to add to the policy agenda, but members can see that we are actively pursuing measures that are necessary to get to the milestones that we have laid out going towards 2020. As I have said, that sometimes has to be done in the teeth of public scepticism—about electric vehicles, for example—but it is important that we do that, and we are doing it.

As I get older, I get amazed at how quickly time passes, and I am horrified at noticing that 2020 is only seven years away. With the publication of RPP2, are you more confident that you will achieve the 2020 objectives, or are you starting to worry about them?

Whether or not there is worry, we have to keep the objectives constantly in mind. As you rightly suggest, if we set a target that is quite far off, the temptation can be to put it on the back burner mentally and in what we do, but I do not think that we do that. The officials with whom I work are certainly assiduous in ensuring that they are conscious of the targets and that they know where to try to meet them. They are also conscious of how difficult the targets are. This is a cliché, but it is likened to having a supertanker whose direction we have to shift. Much of that is to do with public attitudes and behaviours that have developed over a long period of time. I am not saying that meeting the targets is without challenges, but I am confident that we are doing the right things to meet them.

Why does the transport section of RPP2 not include any policies or proposals that aim to reduce the demand for travel?

It is interesting that we have not had suggestions about demand reduction from any other political party—I think that I am right in saying that. We have received such suggestions from interest groups; there is no question about that. It is worth saying that, although we have climate change targets, we are not trying to discourage travel per se. We are trying to discourage and eliminate the environmental costs of travel. Our primary aim is not to reduce travel.

To mitigate rising traffic volumes at national level, we are focusing on initiatives that we believe will reduce emissions congestion and increase the proportion of journeys made by public or active transport as we move towards a low-carbon economy. We are developing work around promoting alternatives to travel—I mentioned the influence that information and communication technology can have in relation to that. That is why we have concentrated on those things.

It is also true to say that many of the measures that might be taken to reduce demand have an environmental cost. Take, for example, tolling. If I think back to the tolls on the Forth road bridge, I can well remember sitting in queues, stopping and starting, waiting to pay the toll before going across the bridge. That had an environmental cost to it. We think that, at this stage, we are better concentrating on behavioural change and the technological changes that we think can help us to meet the targets rather than concentrating on demand measures. It will be interesting to know whether committee members have any proposals for demand measures but, at this stage, we are concentrating on behavioural and technological change.

Looking at the most distant figures—those for 2027—in RPP2, we see some very ambitious cuts in emissions contained within the transport section in that column. People will find it hard to believe that those cuts can be achieved without taking a fairly severe approach to demand management. How do you react to the suggestion that the figures as published conceal an intent to take dramatic action against demand at some time in the future?

I do not think that it would be fair to do that, and I do not think that we are doing that. This comes back to the point that I made previously, which is that the measures that we are taking are the start of a process, the fruits of which will come much more heavily further down the line once we have that level of change.

When we have improved rail services, people will want to use them more and more. We are seeing that already, given that we have 82 million journeys by rail and there has been a major uplift in rail travel. We think that we can improve further on that, and the next franchise is all about doing that. As I have said, we have also taken initiatives in respect of electric vehicles, and there is the possibility of other technologies such as hydrogen. As I said earlier, there will be fruits from those as well as of course from behaviour change.

Behaviour is interesting because we are now seeing people much more conscious of the price of fuel. People are tailoring their journeys or perhaps not undertaking as many discretionary journeys as they otherwise might. With behaviour and technological change, it takes time for things to work through. We have to find out which of the technologies will work the best and which of the behaviour changes will be most effective. I think that we have a fair degree of confidence in saying that the benefits of that can be very substantial.

There is no concealed intention to hit anyone with a huge swathe of demand-restrictive practices. That is not part of our agenda. It is perfectly legitimate that we mention that such things have been suggested by other people and we should never discount them, but we are concentrating on behavioural and technological change.

If you want to change behaviour, surely you need to provide some incentives for people to do that. Those can be positive incentives, or they can be negative incentives such as road user charging, workplace parking levies or congestion charging, which might encourage people to get out of their cars and perhaps join car clubs and so on. Is there not a role for those kinds of incentives to be introduced to change behaviour and move it along a bit quicker?

There is an implication of carrot and stick there, but I think that we are much more inclined to use the carrot rather than the stick. You make the point about car clubs and car sharing. Recently, we have taken a number of such measures in relation to the on-going work on the Kessock bridge. Those measures have included opening up a new railway station at Conon Bridge, which has been hugely popular. We hope that the carrot will work, in as far as people who decide at this point to change to rail to avoid congestion on the Kessock bridge because of the current resurfacing works might make that a permanent change and continue to use rail in future. There has also been a huge uptake in car sharing—I think that 400 people have joined in that over a short period.

We are trying to learn from that. It is much better to lead people to where they want to go than to batter them over the head with a congestion charge or tolls. So far, based on what we know, we think that the carrot is working. People can take action on workplace car parking if they want to do so—it does not require a Government to do that, although of course Government can play a part if people want it to do so.

10:45

We are very seized of the need to make it as easy as possible for people to make the shift. People might be quite keen on the idea of travelling by train, but the journeys to get to the train and then to get to work after getting off the train can be such that it does not seem to be worth the bother, so they carry on using the car. We are putting a lot of thought and resources into the issue. People might want to use their bike to get to the train station and then when they continue their journey after they get off the train. In the Netherlands, people just hire a bike; they do not have to take their own bike. Not many bikes are taken on trains, but people can park their own bikes safely all day—in fact they can get punctures fixed and other repairs done where they leave the bike—and then pick up another bike at the other end of the journey, to take them to where they want to go. We want to make it as easy as possible for people to make the transition, rather than using the somewhat blunt instrument of demand measures.

We have to take the public with us. Tolls were immensely unpopular and, in many cases, unfair—I still have my conviction for not paying my Skye bridge toll, of which I am very proud. There are different views on how effective congestion charging in London has been. We are concentrating on encouraging people, and we are seeing dividends from the approach at the Kessock bridge and elsewhere.

The issue to do with making it as easy as possible for people to make the shift is the mainstay behind arguments for high-speed rail to come to Scotland. If people can have a decent journey time and the right kind of service between London and Glasgow or Edinburgh, they will choose that option rather than flying. Air passenger duty was meant to be an environmental tax and a demand measure—I think that most people realise that it is nothing like an environmental tax and is a revenue-raising device—but has not led to modal shift.

It would not be much of a tax if it did not raise revenue.

It raises a huge amount of revenue—

Exactly.

Aye, but it was mooted as an environmental tax, and that has not worked. APD is an example of a demand measure that has not led to modal shift. We think that encouraging people is more effective.

I understand that a behaviours framework in relation to RPP2 is due to be published by the end of February.

We do not have the exact date, but it will be published fairly shortly.

How confident are you that a sufficient number of hybrid, hydrogen and plug-in electric vehicles will be bought in Scotland to enable us to meet the vehicle emissions reduction targets in RPP2?

As I said, there is some uncertainty about that but, given that manufacturers are investing more and more in the area and electric vehicles are getting more reliable, with a greater range, we are confident. Some people are evangelical about electric vehicles. I had the chance to go round Knockhill circuit in a very fast one the other day. Even people who quite like performance in their cars are aware that there are high-performing electric cars.

You will remember that people thought that diesel cars were a bit slower than other cars when they were first developed, but diesel vehicles developed in such a way as to become indistinguishable from petrol vehicles in terms of performance. It is a question of making that kind of change, which is always difficult at the start. People often say. “Oh, you’ve got more charging places than you have vehicles.” When people first had the internal combustion engine, there were not filling stations across the country ready to service them; it takes time to build up the infrastructure.

As part of ensuring that enough electric vehicles come here, we are trying to tackle what is called range anxiety. That arises when people are concerned that if, for example, they start off on a trip from the border to Edinburgh, they might not get there. In most cases, however, people do not make journeys of that length in any event. Most journeys tend to involve much shorter distances.

We will continue to invest in the area. Heavy investment is required at the start, for example under the plugged-in places initiative, which the UK Government is also involved in, but I am confident that, if we do the required work, more and more people will take up the option. I am also confident about technological change. The industry is an adaptive one and if it sees an opportunity, it will take it.

There is also willingness to get involved. People are concerned about climate change and they will take the right decisions for the environment if the opportunities exist. Obviously, they have to be mindful of the costs to them.

Even in the electric vehicle market, there are different approaches and different technologies—there are different batteries, for example—and it is not possible to say with a huge amount of confidence which ones will produce the greatest dividends. However, I am confident that the area will grow and develop.

We should also bear hydrogen in mind. That is more talked about in relation to buses just now, but it has the potential to produce huge dividends as well.

If the uptake of electric vehicles is low, do you have any contingency plans in place to meet the transport emissions targets?

We are monitoring the progress that is being made. In general, if we feel that we are contributing to and investing in something that is not producing results, we have to change it, and to do that we need a level of flexibility. We are proceeding with broad proposals so that we leave ourselves that flexibility to move things around. However, it does not seem to me to be that way just now. I have opened a number of charging points recently, including at Edinburgh Napier University and Axeon in Dundee, and the area seems to be growing. What we know of what the manufacturers are doing suggests that they think that it is going to grow, as well.

However, if something that we are doing is not having the desired effect, then of course we have to be responsive enough to change it.

How do you respond to concerns that simply replacing petrol and diesel vehicles with low-emission ones does not provide the health, social and other benefits that are associated with active and public transport?

We have not talked as much as we might have done about active transport or active travel. I think that the two go side by side. We have to try to tackle this in different ways. Reducing the harmful effects of travel by car and replacing it with public transport is important, but that does not mean that we do not think that active travel is important as well. In the example that I gave Adam Ingram, I mentioned the idea of people changing from a car journey to a train and bike journey that is made much easier for them.

At present, someone might be concerned that they cannot take their bike on to the train, that they will have to leave it somewhere that is not secure or that there are no contingency plans if they have a broken chain or a puncture. If we can alleviate those concerns, we can get people to be involved much more in active travel. In the rail franchise, we have set aside moneys for new stations and station improvements. If we can make access to railway stations much more local for people—it may be worth talking about the Edinburgh to Glasgow project in relation to that—there is more chance that people will walk to the station rather than making the whole journey by car.

On the Edinburgh to Glasgow project, if we have the high-speed link that we discussed last time I was at the committee, it will alleviate the pressure on the other lines. The fast journeys from Edinburgh to Glasgow will be on the high-speed link, and more local communities will be able to tap into the other lines. The more we make the rail network available to local communities, the more active travel we will have, with people walking or cycling to railway stations and bus stations.

It is not the case that we are not supporting active travel as well. We are putting substantial moneys into that. It is just one of the things that we are doing. We should not see what we are doing on low-carbon vehicles as being against what we are trying to do on active travel.

Minister, you said earlier that the Government was focusing on bringing about a behavioural change in people’s travel patterns. In evidence to the committee last week, Sustrans, Cycle Scotland and Transform Scotland have suggested that intelligent traffic systems and average-speed cameras may, by smoothing traffic flow, make driving more appealing and harm efforts to encourage modal shift to active travel and public transport. How do you respond to those concerns?

There are intelligent transport systems on the Forth bridge, which I have used a great deal, and there will be such systems on the new Forth crossing. If people are coming in from the north and stopping and starting on the way into Edinburgh, which has often been the case, that causes a lot more environmental damage than might be caused by smoothing the traffic flow. Apart from reducing journey times, which is obviously a consideration, smoothing the traffic flow has an environmental benefit, and we should not set it against the other measures that we are taking. It is beneficial to the efficient movement of people and goods across the network, and it is good for the economy, which is a positive improvement.

That is not incompatible with a low-emissions transport sector. We must make the best use of the existing infrastructure and, as I mentioned, reducing congestion contributes to efforts to decarbonise transport. By deploying ITS systems on congested sections of the trunk roads and motorways, we will encourage more efficient driving and smoother traffic flow. However, we must balance that approach with other efforts on a range of fronts, including the promotion of new low-carbon vehicles and fuel options as well as alternatives to private car use.

We should not set one element of progress against other elements. My response is similar to the one that I gave to the previous question: we must do both of those things.

Nigel Holmes from Scotland’s 2020 climate group suggested that the Scottish Government should investigate the effectiveness of the in-cab intelligent transport systems that are used by major haulage companies to reduce fuel consumption, with a view to assessing their cost effectiveness in reducing emissions. Are you considering that?

The industry already uses such systems, which suggests that they have become market ready. We are looking at the wider use of telematics as part of the work that we are doing to promote fuel-efficient driving. Many companies now invest quite a lot of money in ensuring that their drivers drive in the most fuel-efficient ways for straightforward economic business reasons.

For our part, Transport Scotland is grant funding the Energy Saving Trust to promote fuel-efficient driving. As part of that work, it is running a pilot that uses telematics linked to driver training, although that has still to be evaluated.

Good practice continues to be shared among organisations—such as Scottish Natural Heritage—that are using in-vehicle telematics as part of their fleet management. The EST is promoting the FuelGood app for smart phones through its website for those who are participating in fuel-efficient driving training, as well as for members of the public and public sector drivers. The app provides a tool to keep track of the fuel impact of different driving styles and encourage improvements, which makes financial sense. Most people are driving relatively modern cars nowadays and have something on the dashboard that tells them how much fuel they are using, so there is already some awareness, but the app refines that somewhat. We are interested in that idea, and we will look at how we can evaluate and encourage it further.

The 2020 climate group’s final criticism related to the Government’s trunk- road building programmes, such as the dualling of the A9. How are such schemes compatible with the Government’s emissions reduction commitments?

I have made the point before that, if we have roads, they should be in as good and safe a condition as we can possibly make them. It is also true to say that much of our public transport uses roads. Buses would find it hard to get around without roads, as would trams in Edinburgh—a subject that I know is close to the member’s heart.

When we undertake those road projects, we also look at how we can improve the cycle network and active travel options, and those are very much under consideration in the A9 programme. The cycle network is quite well served just now, but we can do more to improve it, as we are currently doing on the A82 from Fort William to Inverness.

Any modern economy has to have roads, and—I am perhaps stating the obvious—if we have roads they should be as good as they can be and go to the right places. I do not think that that is incompatible with doing the right things for the environment.

11:00

I want to clarify a few points from your evidence this morning before moving on to other areas that I want to explore.

First, you mentioned cyclists travelling on trains. Has that issue been considered as part of the brief given to train operating companies on the renewal of the ScotRail franchise? Is having a level of provision for cyclists part of that brief?

Secondly, you said that the smarter choices, smarter places demonstration projects were being evaluated. What is the timeline for that?

On the first point, we have not finalised the brief for the next ScotRail franchise. There are still some things that we have to do. We have made it clear that we expect operators to have regard to integrated transport and we are exploring the extent to which we can make it an obligation, for example, that rail timetables will respect and integrate with bus timetables. That sounds obvious, but it has been talked about for a long time. The ScotRail franchise is one of the Government’s tools—it will be the Government’s biggest procurement exercise. We are exploring the extent to which we can oblige the operator to integrate in relation to both buses and cycling.

In relation to cycling, the issues are allowing people to take their bikes on to trains and enabling them to cycle to and from train stations. I had a discussion yesterday with a Dutch railway operator, which has limited access for bikes on trains. It decided that the best route was to ensure that its stations have secure places for bikes, usually associated with a workshop that can carry out any necessary repairs. In addition, bikes are made cheaply available. That is an interesting approach.

We hope to improve the general level of rolling stock in the next franchise but there is a limit to what we can do. We will explore the ability to make more space available for bikes on trains, but that has a limit. We should also explore ways to make cycling more feasible for those who use trains, for example to make sure they can get to the station, perhaps leaving their bike there and picking up another bike elsewhere.

On the second question, we have not given a specific timeline for the smarter choices, smarter places evaluation, but it will be later this year—I would hope in late spring.

Thank you. That is helpful.

I want to explore how the Government’s commitment to sustainable and active travel can be embedded into policy through appropriate targets and policies, and how evidence-based policy making informs ministers’ spending decisions.

In considering how we embed targets and policies into Government policy generally, I want to build on the point Elaine Murray made earlier about upgrading proposals to policies. I am interested to hear your thoughts on that and on how you prioritise the areas where we are seeking to make improvements.

We heard evidence from Colin Howden of Transform Scotland in last week’s round-table evidence session. Notwithstanding the fact that he thinks that more money should be invested in sustainable transport, he acknowledged that the Government was investing in cycling, walking, car clubs and eco-driving. He said that such items should be moved above the line from proposals to policies.

I want to push you on Elaine Murray’s point. Will you say whether you think that that should happen and if not, why not? Why should some things be proposals and not policies? Is that no more than a semantic point, or does it illustrate the priority that the Government attaches to certain areas over others?

I am not sure that there is much that I can add to the response that I gave to Elaine Murray. We think that the policies in RPP2 are the right policies, not least because of the scale of the EU directives.

It perhaps reflects where we are in the development of our work on climate change that such work is proposal based. Proposals can become policies if they reach the level at which that is appropriate, so the ability to respond to change is there.

The approach is right; as I said, perhaps it indicates where we are in the development of the work. If I did not give enough information in my response to Elaine Murray, perhaps Katherine Falconer can add to what I have said. We have taken a judgment at this stage, but the wording is not final—the process will go to RPP3, which we will look at in future. As always, we will listen to people such as Colin Howden and others.

On the wider point, it is important that the Government takes its own view on how to embed policies and make them as durable as possible, so that they are not subject to the caprice of things such as spending reviews. However, it is also important to recognise the extent—which we might not always want to recognise—to which people such as you, Transform Scotland and many cycling lobbyists have helped to drive Government thinking. None of those people is about to disappear from the argument, so the pressure will—rightly—be there and we will take it seriously.

I do not think that I have met an interest group that does not want us to spend more money on its interest; I would be interested to meet a group that said that. I understand the point. The pressure will not go away. A perfectly legitimate part of how the Government forms its policies is to listen to such arguments.

You will be glad to know that I am going to move on to funding, but I have one question before we leave policies. Pedal on Parliament said in its evidence that the target for 10 per cent of journeys to be made by bicycle by 2020 should be embedded in policy as a national indicator. Do you have a view on that?

That target—I do not think that it was expressed as a target when it was proposed—is not just for us. It involves other people, such as local authorities and other groups, so it would not be right for us to say that we will have that target and we will achieve it. However, we must contribute to achieving it, and we are doing that. I very much look forward to discussing funding with you, which we will come on to.

It is true of a lot of aspects of RPP1 and RPP2 that they are about not just what the Government does but what other people do. The 10 per cent was expressed as a vision, not a target, when it was first discussed. That is one reason why we would not want to say that it is down to the Government; a much broader approach must be taken.

I will press you on that. I am not sure why you say that the target cannot be a national indicator. If you attach importance to it—as you clearly do—will you say for the record why it cannot be a national indicator?

We have set a national indicator of increasing the proportion of journeys to work that are made by public or active transport. Performance on that is monitored through the Scottish household survey. The cycling target feeds into that. Increasing the number of cycling journeys also contributes to a separate national indicator—

Are you telling us that what is suggested has already been done?

It is covered by a number of other areas. It feeds into the national indicators of increasing physical activity and of increasing the proportion of journeys that are made by public or active transport, as I said. There is a corporate element—it is not just the Scottish Government that is involved.

On funding, I have read the technical annex to RPP2 with interest—in fact, I have scoured it to try to find a reference that I do not think is in it. My point relates to the statement on page 50 of the technical annex that

“Investment in cycling and walking infrastructure is based on evidence of intensive cycle programmes in Europe which have involved expenditure in the order of £5 per person per year over a 10 to 15 year period.”

As that figure appears to be disputed by a number of cycling organisations, I would like to know—probably from the expert advisers who are at the minister’s side—what the evidence base for the statement is.

As you said, there is some dispute about the basis of the evidence. It is difficult to get precise data on the spend, and people’s definitions of what spend on cycling constitutes vary from group to group. How money is spent also matters to the impact that it has.

You are right to say—not least because you quoted the technical annex—that the issue is quite technical. Jonathan Dennis wants to speak about it.

The £10 figure concerns two pieces of information on cycling: the UK energy research centre’s wide review of information that was available from studies that have already taken place; and the “Bicycling and Walking in the United States” report, which is a benchmarking report that includes a look at Europe and gathers ideas about what has been happening in places such as Amsterdam, Copenhagen and Berlin, as well as in America.

As the minister has already said, it is difficult to define what is actually spent on cycling and by whom. However, the numbers suggest that spend can get up to around £26 per head in Amsterdam, but that is because 35 per cent of travel there is undertaken by bicycle, which means that there is a lot of support for that spending. The report suggests a 20 per cent modal share for cycling in Copenhagen, where spending is around £8 or £9 per head. The share is also 20 per cent in Berlin, but spending there is around £4 per head.

You are describing a range of figures, but the document contains a very specific figure.

In putting the numbers together, we have to plump for a figure. There is a recognition that we forecast the numbers based on the information that is available. Rather than having a huge range of figures for expenditure and how much impact it might have, we plumped for something that is somewhere in the middle, recognising the fact that a lot of those cities in Europe are spending a lot of money because cycling already accounts for a significant modal share in those cities. Our target under the cycling action plan is for 10 per cent of journeys to be made by bicycle.

Because of the constraints of time, I will not press you too much further, but I am genuinely confused. The statement in the document related to cycling investment in Europe and gives a figure of £5 per person, yet the range of figures that you have just quoted contradicts that. It would be helpful if you could make available to the committee the references that support the figure in the document, and the other pieces of work that you have just referred to. That would help to inform our understanding of the issue.

Certainly.

There are lists of figures that could have been mentioned and, as Jonathan Dennis said, we have to plump for a figure. Other expenditures that could be mentioned are as low as $3.43, so there is quite a range. However, we are more than happy to provide that information to the committee.

There has been a significant announcement this week on cycling. Sustrans Cymru has announced that the Active Travel (Wales) Bill 2013 will place a legal duty on councils to create a network of routes for walking and cycling. Has the Government had time to consider that? I apologise for putting you on the spot.

We knew that that was coming, as the Welsh Government presaged it some time ago. We are considering the issue. I would not seek to undermine or criticise something that another Government was doing, but it is fair to say that we are not yet certain of the impact of that legislation. It might not be as effective as some people think that it will be.

The short answer to your question is yes, we are aware of the proposal and will take a close interest in how it develops.

On the issue of business engagement around sustainable transport, last week, Nigel Holmes from the climate 2020 group highlighted initiatives to decarbonise freight logistics that are already under way. He asked why there is a lack detail on that in RPP2, particularly with regard to the decarbonisation of road freight. Could you say something about that?

Counterintuitive policies seem to be emerging elsewhere in these islands, particularly from the Office of Rail Regulation and its introduction of track access charges for coal freight, which seems likely to drive a modal shift from rail to road for that form of freight. Could you comment on that, too?

11:15

I will take the second of those questions first. I am not sure that the issue is the introduction of track access charges so much as the increase in the level that is proposed for coal and one or two other kinds of freight.

As you suggest, we are quite concerned about that. It seems to us to be, if not counterintuitive, certainly against the grain of where we want to go. We have made representations to the ORR about that—we did so before it came to a decision—but we have no ability to direct it. In fact, the UK Government has no ability to direct the ORR, which comes to a view on its own. The ORR listened to what we had to say and has changed when the increase was to happen and reduced the scale of the charges.

A large number of coal trains go through my constituency, servicing Longannet power station. If we can keep that freight off the road, that must be better for the economy. The ORR has been less punitive in relation to other fuels, such as nuclear fuels. That is a concern to us.

We have tried to encourage a shift from road to rail freight. The UK Government dispensed with the freight facilities grant in, I think, 2005 but we kept it going for many years after that. However, it proved difficult for many private companies to get through the European regulations on the grant, so many of the proposals that were made were not developed right the way through and the budget was never fully expended. We are starting to encourage further activity in that area because it is beneficial.

I agree with Nigel Holmes to the extent that he says that we should take what measures we can to get freight off road and on to rail—or, sometimes, water. If we can do that, it will benefit the environment.

There are signs of progress. The EU plays a key role through, for example, the policy on emissions from vans. The national atmospheric emissions inventory, of which I am sure you are a regular reader, gives some detail on that. The UK CCC report on the fourth carbon budget states that increasing amounts of freight are being lifted, with a significant increase in road tonnage kilometres travelled since 1990. However, despite that, payloads have also increased.

Looking ahead, options include further modal shift to rail—or water, as I have said; supply chain rationalisation, which could produce real dividends; and continued improvement in payloads. One of the issues that we have encountered is the availability of the correct stock—the wagons themselves. We are examining what we can do on that.

Perhaps the matter is given the space that it is given in RPP2 because we are still trying to make further progress on it and because of some of the constraints on doing more—you mentioned the ORR. However, that should not be taken to mean that we are not keen to do more on it. We are actively doing more, and we are considering some proposals.

There are no final comments or questions. It has been a long hour and a half, but I thank you very much for your full answers.

I suspend the meeting briefly to allow for a changeover of witnesses.

11:18 Meeting suspended.

11:26 On resuming—

Agenda item 3 is further ministerial evidence on RPP2. We will hear from the Minister for Housing and Welfare on housing and procurement aspects of the Scottish Government’s draft RPP2.

I welcome the minister, Margaret Burgess; Peter Brown, programme manager in the procurement policy branch; Rebecca Carr, who is a policy adviser on the renewables route map; David Fotheringham, who is a team leader in the housing sustainability and innovation funding division; Steven Scott, who is a team leader in the building standards division; and Bill Ward, who is the team lead for the procurement reform bill.

I invite the minister to make some opening remarks.

Thank you, convener.

I welcome the opportunity to talk about the housing and procurement elements of the draft report on proposals and policies. It includes policies such as our ambitious national retrofit programme to refurbish Scotland’s older homes, as well as proposals to regulate standards of energy efficiency in new and existing homes.

My portfolio includes responsibility for existing homes in all tenures. The finance and sustainable growth portfolio leads on renewable heat and regulating standards in new-build homes.

It is right that we regard homes and communities as a single package. Housing—together with transport, which Keith Brown addressed earlier—has been the focus of a good deal of attention from environmental stakeholders, not only because a significant proportion of carbon emissions comes from our homes but because poorly insulated, poor-quality housing has a damaging impact on people’s lives.

The committee knows of our commitment to eradicate fuel poverty as far as reasonably possible by 2016. In the face of punishing fuel price increases and cuts in welfare spending, raising energy efficiency standards in housing is the most effective way that we can tackle fuel poverty now and cut carbon emissions at the same time.

We are making progress, with nearly 65 per cent of homes being rated good for energy efficiency by 2011. However, we are not complacent. That is why we are using all available mechanisms within our devolved powers to tackle the problem of older, colder homes.

The Scottish Government is spending around £250 million on energy efficiency and fuel poverty over the spending review period. In contrast, Westminster has cut fuel poverty funding in England from £350 million in 2010-11 to £100 million in 2012-13 and zero thereafter.

Fuel poverty and cutting carbon emissions remain priorities for the Scottish Government. I welcome any questions on them.

Thank you very much, minister.

Witnesses whom we had before the committee last week voiced clear concerns about the lack of depth and detail in the draft RPP2. How does the Government plan to respond to those concerns in the final RPP2?

We recognise and take on board some of the criticisms that were heard. The draft RPP2 is a large and complex document. It is longer than RPP1 and also has 77 pages of technical annex.

It is a draft. During the drafting, there was a view that we should try to avoid complication, but I do not know whether that was successful. We will be happy to reflect on suggestions that members of the committees and other stakeholders make at this stage.

11:30

Is it possible that the final document might replicate the tabular form of RPP1, so that there can be clear charting of progress and some ease of comparison?

We chart progress in housing against our milestones. I cannot commit to having clear tabular progress right across to enable comparisons, but we are certainly happy to say to members that we want to make sure that the document will be understood and that progress can be shown.

If the committee would like, we can show it the progress that we have made on housing. We will certainly be monitoring and charting our progress on that.

Thanks.

RPP1 suggested that the Scottish Government could cut carbon in the homes and communities sector by 36 per cent. What is the expected percentage for the cut under RPP2?

The 36 per cent target was ambitious. The expected target for RPP2 is around 37 per cent, which we also think is ambitious.

Is it ambitious enough?

I think that it is ambitious enough. We are all contributing to meeting the 42 per cent overall carbon emissions target in Scotland. The 37 per cent target is ambitious given that we have tackled the easier part through the universal home insulation scheme and the energy assistance package scheme, which implemented a lot of measures that were cheaper to do. We now have to tackle the harder-to-treat homes, which will cost more. Therefore we think that the 37 per cent target is ambitious and realistic.

Could RPP2 do more to factor in post-implementation monitoring to give us information on actual rather than just expected carbon emissions savings?

The comparisons are not that straightforward. David Fotheringham, could you come in on that?

We monitor progress across our proposals and policies, and we publish detailed data on performance of Scottish Government programmes on the Energy Saving Trust website. We publish data on things such UHIS and EAP, which have been running over the past few years, and that includes data on carbon emissions.

Looking at the proposals and policies in RPP, we are now talking with the Office of the Gas and Electricity Markets and the UK Government about the information that will be available from the energy company obligation regarding delivery in Scotland. We want to continue moving that forward.

One issue is that we can get modelled information, which is based on installed measures and the emissions that we assume come from those measures, but it is much more difficult to measure what happens on the ground. The information that we get from the Scottish greenhouse gas emissions inventory is for the residential sector as a whole, rather than being related to individual policies, so it gets a bit more difficult.

We are certainly monitoring our programmes and publishing the data, which we want to continue to do.

Is there an underlying objective to increase the availability of information as we move from the theoretical stage to the practical implementation of policy?

As the Scottish greenhouse gas emissions inventory publishes more data, that helps us to track what is happening in the residential sector. For example, under the ECO we want to get as specific information as possible on what is happening in Scotland.

My final question relates to the fact that we have missed an early target. The 2010 figures were disappointing. We know that that was because it was a cold year, and we hope that the figures will average out over time. Can the Scottish Government specify what measures in RRP2 will address most the shortfall that has been accumulated?

A combination of measures being taken across the economy and by all departments will address that. Things will fluctuate. You mentioned that the housing target was missed because of the cold winter. Even though more houses were built, we missed a target. However, we are dealing with that as best we can.

Emissions were 7 per cent lower in 2011 than they were in 2010. We are confident that housing-related emissions are coming down and that we will contribute to meeting the shortfall and the overall target. We are not expecting that winters will be so cold. We are putting energy efficiency measures into homes, and related emissions are showing a downward trend.

A number of witnesses in evidence to the committee made the point that there is a requirement for regular monitoring and evaluation of insulation programmes to ensure that standards are met and maximum savings are achieved. RPP1 set out a number of milestones to be reached by 2020; for example, every home is to have loft and cavity wall insulation where that is cost effective and technically feasible. No direct update has been given in RPP2 on progress made on that. Why is that? Will you provide an update on what progress has been made in achieving that milestone?

The latest figures from the Scottish housing conditions survey show that, by the end of 2011, 86 per cent of homes that could have loft insulation have had loft insulation of at least 100mm. Some of those houses have had loft insulation of 200mm or more. Two thirds of the houses that can have cavity wall insulation have had cavity wall insulation.

The boiler replacement scheme is a Scottish Government priority. We should reach our target of replacing 30,000 boilers well ahead of our anticipated timescale. We are confident that every home will have a good standard energy-efficient boiler by our 2020 milestone.

Two thirds of houses have had cavity wall insulation and you are confident that the target can be achieved by 2020.

Yes. We are confident that we will achieve it. Those programmes are running and, on top of those, we have the national retrofit programme. Any measures achieved will become business as usual, but we are increasing the figures.

I will ask you about the private sector. We received evidence from Mike Thornton of the Energy Saving Trust, who made the following observation:

“a lot of the money will have to come from home owners investing in their own properties. In order to do that, they have to be convinced that the measure is technically sound, and that it will drive property prices and make the savings that are promised.”—[Official Report, Infrastructure and Capital Investment Committee, 6 February 2013; c 1343.]

With regards to the Scottish Government’s commitment through RPP2, what further measures are needed to encourage home owners to make such an investment in order to transform the property market in the way that he suggests? Please hold your thoughts on that for a moment.

I will try.

I like to get all my questions out before I get an answer.

Secondly, the Government set up a working group on energy efficiency standards specifically for the private sector. Will you provide an update on that work?

I will start with the working group. We have a commitment to set up a working group and we intend to do that shortly. We are looking at energy efficiency standards in owner-occupied houses and houses in the private rented sector.

The national retrofit scheme, the green deal and other incentives are for private owners as well as the private rented sector. We want to encourage the uptake of those schemes. However, I take your point that home owners have a responsibility, too.

The home report system is due to be reviewed in December this year. We are looking to strengthen the energy performance part of the home report and to highlight its significance.

As we move towards that and as the working group is set up, we have to encourage home owners and show that energy performance will matter. For example, when someone sells a house, energy performance is mentioned on the advert. The issue will be significant, particularly as we move towards ensuring that home owners improve their home. Although we are not committed to regulation, the working group will consider the regulation of the private sector.

Market transformation is important. There is still work to be done on it, and we are doing that work. We absolutely recognise the need to do that.

When will the working group report?

I do not want to say off the top of my head, but it will start work very soon, and I think that we were looking for it to provide its final draft by 2015.

Yes. The idea is that draft regulations will be ready by 2015. The thinking is that the regulations will apply from 2018, to give people a reasonable lead-in time to prepare for the changes and so that they know what they need to do.

That sounds rather a long way away so, just to be clear, are we talking about the development of energy efficiency standards and the implementation of those standards? Have I understood that correctly?

Yes. Is that correct, David?

Yes. The idea is that we will have draft regulations by 2015.

Why will it take so long? Why do you require that amount of time to develop the regulations?

The group is just being set up. It might come up with a different view, but that is the approach that we have set for now.

In the meantime, under existing schemes such as the green deal, the national retrofit scheme and all the other schemes that we have running, we want to incentivise home owners to improve their homes and use the schemes, as we work towards regulation. In England, regulation is due in 2018, and our regulation is likely to tie in with that. However, in England, the regulations will cover only the private rented sector, whereas we are looking at the whole private sector. We are looking at a fair bit of work.

That is helpful. Does the Government have a view on how tax levers—specifically tax reductions—can be used to drive energy efficiency improvements? For example, could the land and buildings transaction tax and the council tax be used as fiscal levers to drive the policy intention?

We are considering that seriously. I understand that the Finance Committee is taking evidence on the land and buildings transaction tax. We will look at that.

Thank you.

There are a lot of initiatives to assist private landlords and individuals to upgrade their houses to make them more environmentally friendly, but unless people know about them they will not access them. What are you doing to raise awareness among the general public so that they access the initiatives to make their houses more environmentally friendly?

We are doing that through the Energy Saving Trust and our energy advice centres. That is the start of the journey for people who are considering energy efficiency measures. People can get advice on the correct measures for them.

We have done a fair bit of publicity on the green deal and cashback vouchers. By the end of January, 1,300 cashback vouchers had been taken up in what is a very new scheme. We are getting information out and we will continue to do that through every available avenue. We see the energy advice centres as the starting point in the journey for people to access the initiatives, which have been widely publicised.

11:45

I would like to ask about funding. What is the Scottish Government’s view of the potential of European regional development funding as a means to improve energy efficiency measures? I understand that in Wales and France money has been ring fenced for that purpose, which has led to successful retrofit schemes.

We think that that is a good idea. We have looked at mainstreaming European funding into policy and projects, and we have some projects going that are funded by European funding. For example, the West Whitlawburn Housing Co-operative’s scheme to convert 543 houses and replace the old storage heating with renewable energy is funded through European and Scottish Government funding. We are looking forward to the Commission’s proposals to have, from 2014 onwards, a tighter focus on investment in economic growth. The right way of spending that funding is to spend it on low-carbon skills.

Planning on future programmes is still at an early stage. The Scottish partnership agreement is being prepared on a UK-wide timeline. We will hold a public consultation on that, but we think that scope exists to use it for energy efficiency and retrofit programmes throughout Scotland.

Thank you for that.

I want to ask about the priority that is attached to energy efficiency. We are going through a difficult time economically and financially, and people are feeling the strain. In addition, the welfare reform process is hitting families hard. What can we do to ensure that energy efficiency in their homes is a very high priority for families? What can we do to reinforce the message?

We can do that in a number of ways. Energy efficiency is clearly an issue for families as far as the cost of their heating is concerned. Reducing their bills will probably be their first focus.

Energy efficiency is an investment priority for the Scottish Government. We will continue the energy assistance package to ensure that vulnerable people who have not already benefited from energy efficiency measures under the old UK programme will benefit from them under the new programme. We have set aside money to continue the EAP for that very purpose. In addition, there is the retrofit programme.

We continue to put money into energy efficiency and reducing fuel bills. That is a priority for us, because it is part of the overall target of the Scottish Government to eradicate fuel poverty as far as is possible by 2016. It is high on our agenda, and it is certainly on the agenda of people in their homes who have bills to pay. We want to ensure that we can help them to reduce their bills.

Is there more that we could do to reflect that priority in RPP2? Should we look at that?

We will reflect what we are doing in RPP2 in the milestones in our sustainable housing strategy. In that strategy, we will lay out what our milestones are for the next stage. Energy efficiency is a priority, which is why we have established the sustainable housing strategy and the sustainable housing strategy group. We will continue to put money into energy efficiency measures.

You touched on the national retrofit programme, which RPP2 introduces. If my understanding is correct, it will replace the home insulation scheme, the boiler scrappage scheme and the energy assistance package. Initially, it will focus on fuel-poor areas. What is the timescale for rolling it out across Scotland? How will it be funded?

We will start to roll it out from 1 April this year.

The Scottish Government has committed funding of £79 million to it—an additional £14 million was included in Mr Swinney’s most recent statement. The programme is for 10 years, but we can take the figures only to the end of the next spending review period.

With the £79 million, we hope to lever in funding from the energy company obligation and bring the figure up to about £200 million. That is a good target. With £3.5 million, the pilot schemes have brought in a further £13 million from the energy companies and money from the landlords who operate those schemes. We think that the figure that has been set is realistic and can be achieved.

We hope that the energy assistance package, which is for people who would miss out under ECO, will continue in some format. We hope that that will happen seamlessly, to ensure that people who have made applications can get help and that people can still submit applications.

Page 163 of the draft RPP2 gives abatement figures for the national retrofit programme. Will you explain why those figures grow in the first five years then stay steady, with no growth, in the remaining 10 years of the RPP2 period, to 2027?

That might be a presentational issue that is to do with the difference between policies, which we have committed to, and proposals. I ask the technical expert, David Fotheringham, to explain the position.

The minister has basically explained it. It is just a presentational question that concerns the difference between a policy and a proposal. As the minister said, a policy is a firm commitment, and a proposal is the subject of further development.

The figures recognise that, although the aim is to have a 10-year programme, the NRP’s scale will be subject to spending decisions by future Administrations. In the figures on proposals, the NRP continues to offer emissions abatement well beyond 2018, but we have presented the programme as a proposal from then onwards.

What monitoring and evaluation of the figures will take place and when will that be completed?

We have not set out in detail how we plan to report on the national retrofit programme. However, just as we are presenting information on the universal home insulation scheme and the energy assistance package, I am sure that we will produce something similar with data on the NRP.

Page 102 of the draft report contains a table that summarises abatement. In the past 18 months, I have gradually got used to civil service speak, but I am not quite sure what is meant by

“Additional Technical Potential in Fabric and Energy Efficiency”.

Will you explain that? Why are the expectations for that measure so high?

I will say a bit about that, and then my officials will talk about the very technical bit.

The reference is to additional technical proposals on energy efficiency that we know can be achieved. We are looking ahead to 2027, which is 14 years away. In that time, technology could change and measures could be done more cheaply or differently. We know that the abatement can be done, but we have not determined at this stage how we will do it, because we do not know what is ahead of us. We would hope to lay that out in the next RPP, which I think will be issued in 2016.

I pass over to David Fotheringham to talk through the modelling.

The abatement potential has been identified through the DEMScot model, which we use for a lot of the modelling in the RPP in relation to the physical fabric of homes. That draws on data from the Scottish house condition survey, which is the annual survey that we do to give us a good picture of the conditions in Scottish housing.

Looking at that, we have identified that potential in the housing stock but, as the minister has said, if we are to look that far ahead we will need to do further work on the best way of achieving all that potential. It could happen through additional incentives, stronger regulation or something else that we are not currently looking at but which could emerge over that time period.

I think that I am a wee bit wiser now.

Margaret McCulloch has a question on how the UK schemes fit in to RPP2.

RPP2 also covers the UK Government’s green deal programme, which allows occupants and housing providers to install energy efficient measures without up-front costs. How exactly is the Scottish Government going to ensure that the green deal and the energy company obligation meet Scotland’s needs, given that previous UK-wide supplier obligations have underdelivered?

I would not say that such obligations have underdelivered. When, for example, the carbon emissions reduction target scheme was introduced, it had a fairly low take-up. However, when the Scottish Government provided finance to help it out, there was much higher take-up. Scotland has 9.4 per cent of the houses in the UK and 9.5 per cent of those that benefited from the programme. We are getting our share of that scheme and would expect to get our share of the ECO under the green deal scheme.

We are talking to energy companies to see whether they want to work in Scotland. Neither they nor we are obliged to get into that discussion, but we are preparing for it and have done a lot of work in that respect; indeed, the Deputy First Minister has spoken to the big six suppliers. We feel—and they feel—that Scotland is an attractive place in which to do business, and we are quite confident that we in Scotland will get our proper share of that carbon obligation.

Not only have the planned improvements in the new building regulations standard slipped from 2013 in RPP1 to 2014 in RPP2, but the ambition with regard to emissions reduction has also been reduced from 60 to 45 per cent. Why have there been such slippages and reductions in those planned improvements?

As the Minister for Local Government and Planning has made clear, we have had to strike a balance between ensuring that we build houses—after all, we want to keep building houses, but it is much more expensive to build them to higher energy efficiency standards—and reducing carbon emissions. The balance that has been struck in RPP2, which we think is the right one, is being consulted on at the moment.

Perhaps our colleague from building control will say a bit more about that.

The initial recommendation for a 60 per cent reduction in the 2007 level of emissions came from the Sullivan report, which was produced back in 2007. Since then, the economic situation has changed quite significantly and the figures for house building are now significantly lower. As the minister has made clear, our proposals seek to strike a balance between delivering on climate change targets and ensuring that we can still build houses in Scotland.

The proposals offer a reasonable improvement in carbon emissions. Building standards are already fairly good—for example, carbon emissions are 70 per cent lower than they were in 1990, which is the baseline year for climate change analysis—and these proposals will save probably 3kg to 6kg of CO2 per square metre per year. If the average house emits about 2 tonnes of carbon a year, we will be looking at saving about 20 per cent with these emissions reduction proposals. The average cost per unit is, I think, between £4,000 and £5,000, which is quite significant given the current economic situation. Again, it is a matter of balance.

Basically, you have lowered building standards in order to increase housing supply.

We are still looking to drive forward standards at an appropriate rate.

The 2010 building standard proposed a rise in carbon abatement, reaching a peak of 142 kilotonnes of CO2 in 2027; however, the 2014 standard is significantly lower with a high of 55 kilotonnes in 2027. Why is there such a difference? Should we not expect the later standards to achieve more than the earlier ones?

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The main difference is that the 2010 projections were based on a build of around 24,000 units per annum, while the current projections are based on build of around 15,000 or 16,000 rising to about 19,000 or 20,000 in future.

So it is because of less house building.

Proportionately, the emissions reduction is being achieved, but the overall abatement is less because we are building fewer houses.

Finally, what is the Scottish Government doing to ensure that developers comply with the building regulations and how can that be more effectively reflected in RPP2?

Are you talking about buildings performing as intended?

Yes.

In Scotland, all building warrants are dealt with by local authorities and we are undertaking a programme of work with them to deliver service improvements and ensure that buildings comply with the regulations. Moreover, only last November, a UK agenda looking at design versus as-built performance was introduced; although it is being driven by colleagues in the Department for Communities and Local Government through the zero-carbon hub, the Scottish Government is also involved in that 18-month programme to ensure that we do what can be done to deliver the product that people are looking for. The focus is on the whole delivery system from initial ideas and procurement through to operation and use and the role that local authorities and building standards can play in checking that things are being built properly, post-occupancy testing and so on.

I have a question tangential to the issue that Jim Eadie raised about energy efficiency standards in the private sector. If you regulate, what will happen to properties that do not reach the standard? Will people be unable to let or sell them?

I certainly do not want to look into the future and suggest such a thing. However, we will have to look at those issues if we regulate, which is why we need a standard that is achievable and practical and why we need to ensure that people in the private sector, private landlords and so on can tap into the funding available from the energy companies.

The Government intends to introduce a procurement reform bill, which I understand will come before the committee and will include a national framework for sustainable procurement. Is there an opportunity even in advance of that legislation for RPP2 to include firm and clear statements on the intended shift to more sustainable procurement methods and the contribution that such a move could make to emissions reduction?

Procurement is not my area of expertise, but we can certainly look at that issue and I think that what you suggest could be done.

When RPP2 was published, the Scottish Government was still developing the policy content for the procurement reform bill. However, the report gives a clear commitment to developing a plan—the date, if my memory serves, was by October 2013—that will cover what more might be done through procurement activities. That will provide more detail on the role of procurement.

What are the priorities for the bill? Does the proposed change in name from “sustainable procurement bill” to “procurement reform bill” reflect any shift in policy priorities?

The proposed change in name reflects no such policy shift. I do not think that the bill’s title matters; what is more important is the intention behind it, which is clearly to provide a legislative framework for procurement decisions that supports the greater use of clauses on social and environmental sustainability . That is what we are committed to and the change in title does not reflect any change in policy.

As members have no more questions, I thank the minister and her colleagues for their very helpful evidence.

That concludes our evidence gathering on RPP2. We hope to consider our draft report on 13 March.

12:04 Meeting suspended.

12:06 On resuming—