In March, the Scottish Government’s Energy Secretary, Gillian Martin, announced that the Heat in Buildings Bill would be delayed. This was not entirely surprising.
The current outline of the Bill, for which a consultation had been published in 2023, was largely the work of the Greens in government and, with the ending of the Bute House Agreement the following year, it had lost its leading sponsors.
With little over a year to go until the 2026 election, it seemed as if a bill setting legal deadlines for homeowners and private landlords to improve the energy efficiency of their properties and to introduce low-carbon heating systems would be too controversial. As such, it appeared likely that the commitment to bring forward a new Heat in Buildings Bill would be kicked to after the election.
It was therefore surprising that, among a smattering of uncontroversial bills announced for the final year of this parliamentary session in May’s Programme for Government, a commitment to bring forward the Heat in Buildings Bill remained.
This is even more interesting when we consider John Swinney’s apparent strategy to focus on delivery and drop the more contested elements of the SNP’s recent agenda.
Yet despite this commitment, a bill has yet to be produced. With the Scottish Parliament in recess until the start of September, this gives very little time for a bill of this significance to be effectively scrutinised and passed ahead of the election.
This also does not account for the large amount of legislation already going through parliament. This includes not only a number of Government bills, but also a large number of Member’s bills which will at least require Stage 1 scrutiny by both their respective committee and the wider parliament.
Even with the usual end of session late sittings and cramming it is hard to see how such a significant bill could be scrutinised and passed in little over half a year including breaks.
One such sign that there may soon be progress was the appointment in June of Màiri McAllan as the first ever Cabinet Secretary solely for housing, with explicit responsibility for the heat in buildings programme. However, with the Scottish Government having declared a housing emergency last year, energy efficiency in homes will not be the only pressing issue in her brief.
Nevertheless, even with the Bill being taken forward, it is unclear what shape it will take and how it will address the issues from the 2023 consultation. The most controversial parts of this include a 2028 deadline for private landlords and 2033 for homeowners to achieve a minimum energy efficiency standard and making the installation of a clean heating system a condition of purchase for buying a home. The consultation also proposed a 2045 cut-off for all buildings to have a clean heating system installed.
While the Scottish Government has a grant and loans system in place, in many cases at least some of the costs for these upgrades and installations would come from property owners.
Increased energy efficiency may lead to savings in bills but, in many cases, these would take years if not decades, even with the current high energy prices, to offset the upfront costs of retrofitting properties and installing clean heating systems. In 2021, the Scottish Government estimated that decarbonising Scotland’s homes and buildings would cost £33 billion – a figure that is likely to be significantly higher today.
The Climate Change Committee, advising the Scottish Government on their pathway to net zero by 2045, have stated that 40% of homes will require a clean heating system by 2035, with installations needing to hit nearly 35,000 annually by 2030. They have called on the government to “urgently” produce new legislation to set minimum energy efficiency targets.
The latest available data shows a stark chasm between these ambitions and the current reality. In 2023, just 2% of homes used a heat pump as their primary heating source and only 51% of owner-occupied properties achieved EPC C standard or above with 11% being EPC E or below. For the same year, 6,388 heat pumps were installed.
In order to hit climate targets, the revised Heat in Buildings Bill is going to have to set deadlines to incentivise a speeding up of the rollout of clean heating systems and energy efficiency upgrades.
However, it would be a difficult sell for the SNP to go into next year’s election, with families continuing to struggle with cost-of-living pressures, delivering or proposing policies that would explicitly cost homeowners thousands or even tens of thousands of pounds over the next decade.
At the same time, they will also be concerned at being seen to be watering down climate action and continuing uncertainty for the decarbonisation sector
So how could the Scottish Government square this circle? In a hint of what may be forthcoming, Alasdair Allan, the former acting Minster for Climate Action, in April said that the new Bill “rather than placing all the onus on individual action it will emphasise a collective response” suggesting a shifting of costs from homeowners to the government.
However, given the significant costs of decarbonising homes, it is unclear how this could be delivered to the original targets within the Scottish Government’s budget without substantial savings elsewhere or tax hikes. Barnett Consequentials from funding for home decarbonisation in England through the Warm Homes Plan will only cover a fraction of these costs.
Another possible option to avoid parliamentary crunch ahead of the election would be to publish a draft bill with the intention of actually passing said bill in the next session.
This would meet the commitment to bring forward a Heat in Buildings Bill in this session but leave its debates to the next session and parliament. However, kicking the can down the road may lead to the government being criticised over climate inaction during the campaign, including from their former Green partners, while still having proposals on the table containing significant costs to the public.
A further option would be to pass a so-called framework bill and leave the controversial areas, such as the setting of deadlines and the implementation of any owner responsibilities, to secondary legislation.
The Cabinet Office defines framework legislation as “A bill or provision that consists primarily of powers and leaves the substance of the policy, or significant aspects of it, to delegated legislation”, with the use of legislation of this type increasing in the Scottish Parliament in recent years.
This provides perhaps a best-of-all-worlds situation for the Scottish Government, allowing it to deliver on its commitment to pass a bill but leaving details on its implementation until after the election. However, it is likely to still face challenge in parliament and will leave the decarbonisation sector and homeowners with continued uncertainty.
Whatever action McAllan and the wider Scottish Government decide to take in this area, it is clear that the looming election will have a major influence on legislation to decarbonise homes.
Both in parliament and for voters, the SNP face the challenge of finding the right balance between introducing new costs for homeowners or the taxpayer and going far enough in setting an approach to credibly claim progress towards Scotland’s climate targets.
On both sides of the debate, they risk giving opponents another campaigning issue in a challenging election. Yet the parliamentary clock continues to count down on passing this contentious bill.
