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Scottish government to inject £20m into low carbon heat in fast tracked fund

The fund is to focus on heat pumps, although other low carbon heating solutions will be considered.

The fund is to focus on heat pumps, although other low carbon heating solutions will be considered.

A £20 million low carbon heat fund for social housing is being fast tracked by the Scottish government to kick-start installations.

Heat pumps are to be prioritised by the Social Housing Net Zero Heat fund, although biomass boilers and integrated low carbon heat solutions in existing social housing will also be eligible.

The vast majority of the investment is to be made in the coming year to support the start of construction on shovel-ready projects, with the hope that this will therefore support Scotland’s economic recovery from COVID-19.

“This £20 million Social Housing Net Zero Heat fund will deliver rapid investment to support both our energy and construction sectors whilst reducing bills for those who in many cases have been worst-hit by the economic impact of COVID-19,” Scotland’s energy minister, Paul Wheelhouse, said.

The funding - which is to be provided through a blended model of capital grant funding with loan funding available as partial match - is split into three themes.

The first theme focuses on urban social housing, with air-source, ground-source and water-source heat pumps all eligible alongside connection to existing heat networks.

The second theme is rural and social housing, with all three heat pump technologies eligible as well as small-scale biomass boilers and connection to existing heat networks.

Lastly, the third theme - integrated low carbon heat systems for social housing across Scotland - sees the three heat pump technologies, biomass and connection to existing heat networks eligible, with other low carbon technology such as solar, battery storage and thermal storage able to be considered in conjunction with low carbon heat solutions.

Similar funding was announced by the UK government in August, with heat pumps to be eligible for funding from the £2 billion Green Homes Grant.

This is the second tranche of funding to be recently announced by the Scottish government, which unveiled a £62 million support package for the energy sector in June. The Energy Transition Fund was designed to support the industry through both the impact of COVID-19 and the oil and gas price crash.

“The Scottish government remains wholly committed to ending Scotland’s contribution to climate change by 2045 and to ensuring that we do so in a way that leaves no-one behind,” Wheelhouse continued, adding that the funding for heat is set to deliver on both those principles.

Applications for the fund are now open, with applications welcome from registered social landlords, Local Authorities and energy service companies.

Meanwhile, Scotland's second largest city, Glasgow, is aiming to be the first net zero city in the UK. However, in February ScottishPower launched a roadmap for Glasgow’s net zero transition, finding that the city alone would require over £2.3 billion to be invested in its energy networks, heat pumps and electric vehicles to help achieve this goal.

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