Chamber and committees

The judgments and issues in the energy strategy and just transition plan are informed and influenced by a range of recent developments in the United Kingdom Government’s energy policy and, indeed, by court decisions. Therefore, there remains a rapidly changing landscape—for example, the UK Government’s consultation on future oil and gas policy will be open for stakeholder input over the coming months. We are taking time to reflect on those on-going developments before drawing any conclusions and publishing any final strategy.

I am pleased to update Parliament on the next steps that the Scottish Government will be taking regarding a heat in buildings bill.

In 2019, the Parliament agreed that Scotland will end its contribution to global emissions as soon as possible and by no later than 2045. Our commitment to that ambition is unwavering.

As outlined to Parliament on Tuesday, the Government is also committed to reducing fuel poverty through the limited devolved powers that we hold. It is vital that we find the right balance to both reach net zero by 2045 and reduce fuel poverty.

We have already achieved a great deal when it comes to our transition to net zero. In 2023, 91.2 per cent of electricity generated in Scotland was from zero or low-carbon sources. Specifically, 70.3 per cent of electricity generated was from renewable sources. Our target for 6,000 public charge points was met two years ahead of schedule, and more than 2 million children, young people, disabled people and older people are now benefiting from free bus travel, making sustainable travel more accessible for everyone in Scotland. We have created almost 75 per cent of the United Kingdom’s new woodland since 2019, and an estimated 56 per cent of homes are now rated energy performance certificate band C or better, which is an increase of 11 percentage points since 2019.

Those are just a few of the many examples of tangible progress and Scottish Government actions that have taken us halfway to net zero. However, we all need to do more. We need to see climate action in all areas, by individuals, households and businesses, and by all parts of Government.

The way that we heat our buildings accounts for around 19 per cent of our country’s total emissions. Scotland depends greatly on gas and other fossil fuels for heat. Nearly 90 per cent of our homes use those fuels. In Europe, only the Netherlands has a similarly high dependence on gas as we do. Meanwhile, for communities that are off the gas grid, fuel poverty is even more prevalent—a subject that I will come to in a moment.

I raise all that to underline just how significant an impact decarbonising our buildings will have. That is why the heat in buildings bill is so important. As members know, we consulted on a range of proposals, and that consultation closed last year. It received more than 1,600 responses, and I thank everyone who engaged in that process. We received a diverse range of views. Many people supported the need for legislation requiring energy efficiency standards and prohibiting certain types of heating in buildings; others questioned that need.

Having carefully considered those views and having listened to a range of stakeholders since the consultation concluded, I am today charting a new course that is, I believe, consistent with our goal of removing emissions from buildings by 2045. Our plan to deliver a revised bill responds to the legitimate reservations and concerns that have been raised since our consultation was completed, including the risks of exacerbating fuel poverty and of burdening every individual householder with an overly onerous responsibility as we decarbonise.

Parliament is more than aware that many households, families and businesses across the United Kingdom are facing difficult circumstances. Despite promises from the new UK Government that energy bills would be lowered by £300 a year, since October last year they have risen by almost £300. A unit of electricity presently costs around four times more than a unit of gas, and up-front costs for installing clean heating systems remain higher than those for fossil fuel systems.

A combination of all those factors, combined with a severe cost of living crisis, makes it simply unaffordable for many building owners to make great changes in the near future. I believe that those challenges could be particularly pronounced for those in rural and island locations, whose needs and circumstances we must continue to consider carefully.

All those factors merit important changes in our approach—changes that demonstrate that we are listening and responding to the important concerns that people have raised. Our approach moves away from penalising individuals, and instead commits to collective action. Instead of placing prohibitions on every homeowner, we will establish targets for Government to reach. Rather than looking at action through the lens of decarbonising alone, we will also commit to doing everything within our power to reduce costs for people.

I am confirming today that we will introduce a heat in buildings bill, in this parliamentary session, that will create a target for decarbonising heating systems by 2045. It will send a strong signal to homeowners, landlords and other building owners about the need to prepare for change, while outlining collective actions to help do that, and that will give the supply chain confidence to invest. The bill will underpin our existing work to progress to net zero through the range of support measures and interventions that are already available to households seeking to transition their homes to non-polluting heating systems.

The most obvious way that the bill will do that is by boosting heat network development, by creating particular requirements for large, non-domestic premises and including powers to require public sector buildings to connect to district heating when it is available. We will, of course, work with those building owners to ensure that appropriate safeguards are developed. Those powers will help to make more heat network projects investible, which will lead to greater choice for households and businesses in how they reach net zero.

My intention is that our bill will enable and support flexibility. It will be technology neutral. Different properties and people will require different solutions; for example, the clean heating solutions in some remote and rural areas may vary from those in urban areas. Reaching our target is likely to need a range of technologies, including bioenergy.

Our bill will also include powers to set minimum energy efficiency standards for owner-occupier and non-domestic properties, as part of a plan to reduce greenhouse gas emissions that are caused by heating systems.

In the meantime, to improve the standard of rental properties and to help to reduce fuel poverty, we will make regulations under existing powers to introduce a minimum energy-efficiency standard in the private rented sector. Those regulations would mean all privately rented properties, as far as possible, reaching the equivalent of EPC rating C. That would improve those homes, reduce energy costs for tenants and support the transition to clean heating.

My officials are working to prepare the bill for introduction in year 5 of this session of the Parliament. It will accompany our related work on a social housing net zero standard and EPC reform under existing powers. The bill will affect everyone, but it will differ markedly from earlier iterations in that it will not be a prohibition but a target and rather than placing all the onus on individual action it will emphasise a collective response. The opportunities that it will present for Scotland are significant.

The proposed legislation will build on the Climate Change (Emissions Reduction Targets) (Scotland) Act 2019 that the Parliament came together to pass, so I am confident that we share its overall intent. Following its introduction, I will work with members from all parties on the points of detail that underpin it to ensure that it works for consumers, home owners, businesses and rural and island communities.

Progress towards decarbonisation in housing depends on action in reserved areas from the UK Government, too. The UK Government could take several vital actions that would accelerate buildings decarbonisation and support the legislation that I propose. That is why I hope that members will join me in calling for the UK Government urgently to clarify its intentions on phasing out gas boilers in existing homes and the future role of the gas grid in heating our buildings, on rebalancing policy costs from electricity to gas bills to incentivise the installation of clean heating in a way that alleviates fuel poverty and on reform of the Great Britain energy markets to support a reduction in the cost of electricity more generally. Without those and other changes, we are severely hampered as we attempt to deliver this societal and economic transformation.

I began by reflecting on the scale of the challenge that faces us. The framework of targets and regulation that I have described can provide certainty to building owners and confidence for investors and supply chains. We will, of course, continue to provide advice and financial support to those who need it most. We are investing a further £300 million in our heat in buildings programmes this year, including support to more than 20,000 Scottish households to save up to £500 a year on their energy bills. Therefore, I ask members to work with me when we introduce our heat in buildings bill to Parliament and to support our calls for the UK Government to take similar action. The actions that I have described can cut carbon and help to reduce fuel poverty at source. They are essential to achieving the goal of net zero, for which the Parliament voted.

A number of members have, rightly, made the point about the different situations that pertain in many rural areas, where there are distinctive housing types—poured concrete is one that is prevalent in my part of the world. Unless we take account of that, we will not succeed. We must have a scheme, and a piece of legislation, that will work for all of Scotland. I agree that striking the right balance between meeting our net zero obligations and ensuring energy affordability will mean that we must take account of those crucial differences across the country.

I thank colleagues from across the chamber for their valuable contributions to today’s debate on the Aarhus convention and the important matter of environmental justice.

As Mr Golden and many others have pointed out, access to justice in environmental matters is vital for both urban and rural communities. As members will appreciate, access to justice does not, and cannot, mean that all parties will always achieve the outcomes that they desire from every decision, but we should, as the Government does, seek to ensure that the rules are fair.

Siobhian Brown set out with great clarity the position in respect to compliance with the Aarhus convention, and it is important that we keep that issue in perspective, as she and many other speakers did. The Aarhus convention includes a wide range of obligations regarding environmental information, consultation and access to justice. We are currently working to address concerns raised by the compliance committee regarding one area that I accept is important: the cost of seeking judicial review of a decision. That is not a challenge to our overall approach to environmental information approvals or permitting, so I do not accept that the Scottish Government has, as some speakers suggested, been ignoring the convention.

There is clearly much that the Scottish Government can do and is doing to make progress on the outstanding issues. As was said earlier, action has been taken on protective expenses orders and a rule change has been enacted prompting a petitioner to request confidentiality when lodging a motion requesting a PEO, so that any hearing would be heard in chambers. That is progress, as is a rule change enacted in June last year that clarifies that a potential litigant’s exposure to an intervener’s costs is likely to be nil, provided that the litigant acts reasonably.

I accept that there is much more to do, but I will pick up on more areas of progress. A number of speakers referred to the specific point about reform of the system as it applies to sheriff courts. It is for the next court fees consultation, which is due to take place in the coming year, to look at that issue, but the Government certainly hopes that there will be progress.

The bill will be introduced to Parliament this year. The timescales that we are working towards aim for it to receive royal assent by the time of dissolution, so it will be introduced in the present session of Parliament.

I am disappointed that Meghan Gallacher regards the proposed bill as simply a rehashed version of the previous proposal. I had expected her to point to the areas that are different from those covered by the consultation on the original bill, some of which I mentioned earlier. The fact that we are talking about targets rather than prohibition is a fairly significant change. It will not be one that everyone will agree with, but it reflects the fact that the Scottish Government has listened to the people who came to us during the consultation rather than merely going through the motions. I hope that she will come to want to work with the Scottish Government, because we should seek to work together towards an aim for which the whole Parliament voted.

The member will appreciate that wood-burning stoves and heating oil open up two very different sets of questions. I made it clear from the outset that we are seeking to move people on to clean systems of heating their houses by 2045.

The member will be aware that I responded to the issues that were raised about wood-burning stoves and the regulations that surround the building of new houses around rural Scotland. I sought to respond to those concerns and to ensure that communities’ voices were heard, given that, in many areas, those forms of heating remain not only the most suitable but, in some cases, the cleanest form of heating that is available.

Warmer homes Scotland will be 10 years old soon, and it continues to grow in scale, with an expectation that we will support—I noticed recently—our 50,000th customer sometime very soon. To meet the strong demand for the scheme, we allocated an extra £20 million to it in 2024-25, bringing funding to a record £85 million. It is a very important scheme, and the funding has enabled us to support the largest number of households in one year since the scheme began. Each eligible household is offered a bespoke package of measures that takes account of the needs of their property and their household.

I very much respect Patrick Harvie. I am not entirely surprised that, in the course of the questions on my statement, I have been told both that the bill is a rehash of what was in the consultation and that it represents the gutting of what was in the consultation.

Patrick Harvie had a deep involvement in this area of Government and has a great knowledge of it. He had to acknowledge that Government can do only what is possible, and he, along with the rest of us, had to acknowledge that, for instance, decarbonising 1 million homes by 2030 was not possible.

I will not make the mistake of bringing a bill to the Parliament that I know not to be feasible or possible. That would not be fair to the Parliament or the public. I have sought to come forward with a bill that has targets. Patrick Harvie is right about that and in saying that targets mean something only if there is a plan to get to them. There will, indeed, be plans to get to those targets, and that is the next job of work.

The member is right about that particular issue, which exists in rural areas such as the ones that she and I represent. As I mentioned earlier, the best clean heating solutions for some remote and rural areas might, in fact, vary from what is best for our towns and cities. We will take a technology-neutral approach, which will enable building owners in all areas to choose technologies that are right for them and their homes. In some rural and remote areas, that might include bioenergy and biofuels. We need to recognise the differences that exist across the country and the particular problem of fuel poverty, which we in no way wish to exacerbate through that process.

I understand that the Government is working with the Scottish Law Commission on some of those issues.

The member represents Edinburgh Northern and Leith, a constituency that is virtually entirely comprised of Victorian or pre-Victorian tenements. Challenges are faced in an urban landscape like that one that may not be faced in other parts of the country, not the least of which is the challenge of trying to get all eight—or however many—households in a close to act at the same time.

I mention that not to deflect attention to the UK Government but because examples like that point to the need to open up the debate about the price of electricity. Many a heating engineer has told me, when I have been visiting their training in colleges around the country, that they would love to install large numbers of electric boilers in places such as Leith—if the price of electricity were such that it would be an attractive prospect to do so.