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Clean heat

Scotland is working to reduce carbon emissions in its heat industry. Learn about the wide range of opportunities for low carbon heat projects and investment.

Did you know?

Scotland’s commitment to decarbonisation is demonstrated by our world-leading climate change targets, such as net zero greenhouse gas emissions by 2045.

  • £1.8 billion

    of Scotland's public funds are committed to supporting clean heat over the next five years.

  • 50%

    the equivalent of half of Scotland's total energy demand will be met by renewable sources by 2030.

  • 1 million homes

    and 50,000 non-domestic buildings are set to switch to zero-emissions heating by 2030.

Scotland: driving change in clean heat

Scotland is working to decarbonise its economy. With a goal of net zero emissions by 2045, we're aiming to end our contribution to global climate change within one generation.

Heat is the single greatest source of Scotland's carbon emissions. That's why we're transforming our heat industry, setting a pace for the rest of the world and opening massive market opportunities.

Join a world-leading clean heat industry

Scotland's public sector has committed to spend £1.8 billion on decarbonising heat over the next five years.

This means that, right now, you have a huge amount of options if you're looking to invest in low carbon heat. You'll find opportunities across our rapidly growing market for heat pumps, heat networks, energy efficiency solutions and associated components.

As well as a steady stream of orders from Scottish customers, your investment project will also have access to the wider UK clean heat market — set to become one of the biggest in Europe — and nearby EU markets.

By locating in Scotland, you'll join a country known for its innovation and world leadership in sustainable solutions. Our laws and funding programmes will support you before, during and after you invest.

Scotland's clean heat targets

Scotland is committed to a net zero future. Join us and be part of meeting our ambitious targets, which include:

  • Net zero greenhouse gas emissions by 2045
  • The equivalent of half of Scotland's total energy demand (electricity, heat and transport) to be supplied by renewable sources by 2030
  • One million homes and 50,000 non-domestic buildings to switch to zero emissions heating by 2030
  • Heat networks to provide 8% of Scotland's heat by 2030 (equivalent to around 650,000 extra homes)
  • Installation of 200,000 zero emissions heating systems per year by 2030

The Scottish Government's strong, proactive legislation is designed to help us achieve our zero emissions targets on schedule. It also helps drive market growth and creates huge opportunities for companies like yours.

Read our timeline to see how legislation is driving change:

  • 2019 - Climate Change (Emissions Reduction Targets) Act sets world-leading targets
  • 2021 - Heat Networks Act to ensure the development of new heat networks
  • 2021 - Heat in Buildings Strategy to achieve net zero emissions
  • 2023 - Local heat and energy efficiency plans required for every local authority
  • 2024 - Zero emission heating systems required in all new build homes
  • 2025 - Boiler legislation to phase out gas boilers in off-gas areas
  • 2028 - Tighter EPC standards to ensure all private rented properties are at least Energy Performance Certificate band C
  • 2030 - One million homes and 50,000 non-domestic properties to be equipped with zero emissions heating
  • 2030 - Phase-out of new or replacement gas boilers in any building
  • 2033 - Energy Performance Certificate B and C achieved in all private homes where feasible
  • 2045 - Zero emissions from heating homes and buildings

Explore Scotland's clean heat opportunities

Scotland has the resources and expertise to meet the challenges of climate change. The speed and scale of our clean heat development is creating opportunities across the sector.

The heat pump market – which includes manufacturing, components, systems, installation and servicing – is growing quickly in Scotland and the UK. 

By locating in Scotland, you can be part of this evolving market from the start. You can help to create new technology ecosystems, collaborations and value chains. You'll also profit from huge market opportunities in:

  • Heat pump manufacturing
  • Component manufacturing
  • Heat emitters and radiators
  • Installation
  • Smart controls
  • Operations and maintenance

You can take advantage of attractive tax relief at the proposed Forth Green Freeport and Inverness and Cromarty Firth Green Freeport.

You'll also have the ability to manufacture in zones such as AMIDS (the Advanced Manufacturing Innovation District Scotland). This makes Scotland the ideal location for your specialist manufacturing project.

Scotland is one of the biggest potential markets for heat networks in Europe.

Heat networks are central in our transition to green heat, because they'll help us meet our climate change targets and tackle fuel poverty. They'll also create exciting opportunities for companies like yours.

By locating in Scotland, you’ll benefit from strong government regulation and decisive support programmes designed to grow the market and drive the transition.

The Heat Network (Scotland) Act is paving the way for new networks to be developed in all our cities. As part of this, local councils must produce Local Heat and Energy Efficiency Plans and identify potential heat network zones for development. 

This drive is reinforced by a target of 6 terawatt-hours (TWh) of heat networks in Scotland by 2030. This will be worth an estimated £5.2 billion and will connect the equivalent of 650,000 additional homes to low carbon heat networks.

Because of this focus on heat networks, you’ll find an increasing demand for the manufacture and supply of:

•    Pre-insulated pipe supply
•    Pipe installation in transmission and distribution  networks
•    Heat interface units
•    System integration – including waste heat, storage and renewables into heat networks
•    Smart controls
•    Zero emission energy generation

Scotland is looking for innovative products and solutions to improve energy efficiency in our building stock to help us meet our net zero targets. 

By 2033, all 2.5 million of Scotland’s homes must achieve Energy Performance Certificate (EPC) B and C as a minimum. Currently, only 58% of our owner-occupied houses have achieved this.

This means there are opportunities right now for innovative companies to locate here to provide energy efficiency solutions, including:

  • Sustainable home insulation
  • Double and triple glazing
  • Solar thermal systems
  • Sensors and controls to optimise home heating and cooling

You’ll find opportunities for data and digital technologies across Scotland’s green heat industry. Your project can also benefit from our expertise in digitalising heat through our network of innovation centres.

As our market expands, data and digital technology will be essential to reduce energy consumption and cost for households and individual buildings. It will also allow Scotland's power companies to optimise energy use in the wider energy network.

You’ll get support to develop and deliver advanced technologies that can optimise and improve our heating systems, including:

  • Information and communication technologies (ICT)
  • Modern sensors
  • Big data
  • Artificial intelligence
  • Internet of Things

In addition, digitalisation will create new opportunities in cyber security and secure cloud services.

Scotland has a large number of disused mines. This creates unique opportunities for minewater geothermal technologies to be used in residential district heating and industrial heating.

With 600 cubic kilometres (km3) of disused mineworkings in Scotland’s Midland Valley alone, it’s estimated that minewater geothermal could potentially meet 8% of Scotland’s domestic heating needs. It could also provide up to 40% of heat demand in Glasgow, Scotland’s largest city. This provides exciting opportunities for innovative companies to gain an early advantage.

Centres of excellence

Our centres of excellence and innovation exist to help businesses do incredible things. Here are just some of the centres that could transform your heat business:

Energy Transition Partnership (ETP) opens in a new window is Europe’s largest energy research partnership. It can give you access to specialist expertise in heating and cooling technologies, thermal energy storage, and supply and demand mapping.

CENSIS opens in a new window is Scotland’s innovation centre for sensors, imaging and Internet of Things (IoT) technologies. Its work includes an IoT project to tackle fuel poverty.

Built Environment - Smarter Transformation opens in a new window (BE-ST) is the launchpad to a zero-carbon built environment. It brings together world-class academia, government bodies and industry at all levels.

The Data Lab opens in a new window is Scotland's industry-led innovation centre which enables new data science capabilities. These include a data-informed approach to heating systems.

The University of Strathclyde's Power Networks Demonstration Centre opens in a new window  (opening in 2024) will be a unique 1-megawatt (MW) thermal innovation test and demonstration facility. It will service heating and cooling networks, heat sources, heat load emulators, thermal storage and hydrogen.

Glasgow’s Geoenergy Observatory opens in a new window is the UK’s first geothermal testing facility aimed at de-risking minewater geothermal.

Pioneering clean heat projects

Explore Scotland's portfolio of clean heat projects.

Scotland's active heat networks include:

  • Queens Quay 4G District Heating Network (Clydebank) – the largest water-source heat pump district heating scheme in the UK, which heats 1200 homes and businesses
  • AMIDS 5G District Heating Network (Paisley) – the UK’s first fifth-generation district heat network, which supplies heat and hot water from wastewater to AMIDS facilities
  • Stirling Renewable Heat Demonstration Project (Stirling) – extracts clean heat from wastewater and carbon neutral biogas
  • Care Home Heat Network (West Lothian) – an ambient heat network with networked ground-source heat pumps
  • Borders College Heat from Wastewater Project (Galashiels) – the UK’s first heat-from-wastewater energy recovery system, which provides 95% of the heat for the Galashiels campus
  • Shetland Heat Energy & Power Ltd (Shetland) – Scotland’s longest running district heat network, which uses hot water created from non-recyclable waste to heat more than 1200 buildings

Heat networks in development include:

  • Clyde Gateway 5GDHC Network (Dalmarnock) – a network with heat recovery from wastewater, which will provide heating and cooling for office buildings across Scotland
  • Glasgow Waters and Therme Scotland Heat Network (Glasgow) – will connect 1100 homes, leisure facilities and offices to a heat network supplied by water source heat pump
  • Midlothian Energy Limited (Shawfair) – a heat network using energy from waste, which will heat 3000 homes by 2024
  • Granton Harbour Redevelopment (Edinburgh) – will heat 3500 homes through a heat network
  • Torry Heat Network (Aberdeen) – a heat network using energy from non-recyclable waste, which will heat 300 homes
  • Agile Energy Recovery (Aberdeen) – a heat network using energy from waste, which could heat 32,000 homes and businesses

Scotland's active heat pump projects include:

  • North Glasgow Homes (Glasgow) – air source heat pumps installed by Easy Heat Systems, heating 592 homes
  • Stromness Warehouse Buildings (Orkney) – two 40-kilowatt (kW) sea-source heat pumps are providing heat to a multi-purpose facility, using warmth absorbed from Stromness Harbour
  • BODYHEAT (Glasgow) – a world-first project using ground-coupled heat pumps to capture body heat generated by nightclubbers at music venue SWG3, stored in boreholes for on-demand heating and cooling

Heat pump projects in development include:

  • Cairngorm Geothermal Potential (Aviemore) – exploring geothermal heat as a renewable energy source at Cairngorm Ski Resort

Scotland's current heat storage battery projects include:

  • EastHeat (Lothians and Falkirk) – the world’s first heat storage battery, which uses phase change materials to lower emissions and tackle fuel poverty in 625 homes
  • West Highland Housing Association (Oban) – 79 properties upgraded with Sunamp thermal battery storage, enabling access to low-cost electricity tariffs

Scotland's green heat research projects include:

  • H100 (Fife) - a world-first demonstration project with a dedicated green hydrogen production facility, which delivers clean heat to around 300 households
  • Electrification of Heat Project (South East Scotland) – 250 heat pumps installed in the south-east of Scotland
  • Whole Energy Systems Accelerator (Glasgow) – more than 500 homes connected to PNDC’s test and demonstration infrastructure

A supportive business environment

With a compact geography, engaged and connected industry leaders, and active support from the Scottish Government, it's clear that community is an important part of doing business in Scotland.

An innovative and connected supply chain

Scotland is building a robust and sustainable clean heat supply chain and ecosystem. This includes dynamic industry clusters and over 500 companies already active in the clean heat value chain.

But our ambition to increase the local manufacture of clean heat equipment means you’ll be supported to set up and grow here, immediately becoming part of our connected heat community.

You’ll also be located alongside innovative global businesses such as Mitsubishi Electric, Star Renewable Energy and Sunamp.

Clean heat funding and support

In Scotland, you’ll benefit from a range of targeted support to incentivise our homeowners, businesses and public sector to transition to clean heat.

Read more about the funding and support initiatives that provide stability and confidence in Scotland's clean heat market.

Housing Net Zero Heat Fund

• £200 million fund
• Supports social landlords to install zero emissions heating systems and energy efficiency measures

Green Public Sector Estate Decarbonisation Scheme

• £200 million fund
• Supports heat decarbonisation and energy efficiency in the public sector, including the NHS

Heat Network Fund

• £300 million fund
• Supports the development and roll out of heat networks across Scotland

Community and Renewable Energy Scheme (CARES)

• Supports the Community Heat Development Programme
• Technical support for locally generated, low and zero carbon heat project ideas

Clean Heat Innovation Support Programme

• £17.6 million in funding to support innovation and capital investment
• Accelerates the roll out of green heating solutions

SME Loan Scheme

• Interest-free loans for small and medium sized businesses
• Up to 75% cashback for renewable heating systems and energy efficiency measures

Scottish Government MCS Certification Fund

• Grant support for heating engineers to become MCS certified in heat pumps (air, ground or water source)
• Pays 75% of the certification fees

Business Energy Scotland

• Free, impartial support and access to funding
• Designed to help businesses save energy, money and carbon

Home Energy Scotland

• Grant funding and support for energy efficiency improvements
• Up to 75% funding for new heat pumps and optional interest-free loans

Warmer Homes Scotland

• Aimed at those living in or at risk of fuel poverty
• Funding support for energy efficiency improvements, including heating and insulation

Area Based Schemes (ABS)

• Delivered by local authorities
• Energy efficiency programmes to reduce fuel poverty

Influential organisations and programmes

You’ll benefit from our established and influential industry networks, enjoying the sharing of knowledge, networks, research and best practice from the moment you set up here. Some key organisations/programmes include:

High-value manufacturing support

Scotland is committed to becoming a global leader in high-value manufacturing.

Building on our long and rich history in invention and manufacturing, you’ll benefit from our transformational investment in manufacturing infrastructure, innovation and skills initiatives.

Here are just a few key facilities that could help your clean heat manufacturing business:

  • The Advanced Manufacturing Innovation District Scotland (AMIDS) is a leader in collaborative innovation. It has a net zero campus, which is home to institutes of excellence, major research centres, international manufacturers, and business park infrastructure.
  • The National Manufacturing Institute Scotland (NMIS), including the Advanced Forming Research Centre and the Lightweight Manufacturing Centre, enables collaboration on groundbreaking research to transform productivity levels, competitiveness and skills.

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