Energy Efficiency Market Analysis and Economic Opportunity Assessment

Scottish Enterprise commissioned BE-ST (Scotland’s built environment innovation centre) to establish the scale and nature of market opportunities for Scottish businesses across energy efficiency sub-sectors within the retrofit market, both in the UK and internationally.

The project methodology is qualitative in nature and involved comprehensive desk-based research, 100+ literature reviews, 148 responses to 500 stakeholder surveys and 38 online one-to-one interviews.

A successful retrofit strategy would result in warmer homes, reduced energy bills, better physical health for inhabitants, and an equitable sharing of the benefits and burdens of the energy transition. Scotland, with circa 2.6 million domestic properties, is on the frontline of a significant retrofitting challenge. Aiming to enhance energy efficiency standards, and progress towards a net-zero carbon future, with only 1% of the country's existing housing stock achieving an Energy Performance Certificate (EPC) rating of A (denoting a high level of energy efficiency), the task is daunting. With around 79% of households still relying on gas central heating, the dependence on carbon-intensive heat sources is evident. There is a complex network of challenges that the retrofit sector currently faces. Addressing these issues could unlock substantial opportunities, with the primary challenges being ; product and service availability, skills gaps within the supply chain, accessible financing, and demand-side incentives. The report recommends a series of strategies designed to boost the retrofit market and encourage greener practices across multiple sectors in Scotland.

The recommendations from this report are broad and far reaching. It suggests there are many approaches which Scottish Enterprise, Scottish Government and other delivery agencies could take to support the growth of the retrofit market. In addition to supporting innovation for retrofit EEM products and services, unlocking a consistent market demand through green finance and raising public awareness.