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District Heating Loan Fund

District Heating Loan Fund

The Scottish Government’s district heating loan fund closed in April 2024. It was designed to help address the financial and technical barriers to district heating projects.

Location notice

Please note that this page contains information and links most relevant for people living in Scotland.

As part of Scottish Government’s regular review of its support programmes, it decided to close the district heating loan fund on Wednesday 24 April 2024.

This will enable funding for grant programmes to be prioritised and ensure that it’s better placed to make projects financially viable through its existing funding packages. This includes Scotland’s Heat Network Fund.

The Scottish Government remains committed to achieving its ambition that homes and buildings will no longer contribute to climate change.

Accelerating the deployment of heat networks continues to be pivotal in helping achieve the transition to net zero and end the use of polluting heat in buildings.

The Scottish Government continues to offer funding support for heat network projects via the following funding offers:

District heating case studies

District Heating Loan Fund supporting Glen Mhor ESCO in Inverness

District heating loan fund helps ng homes replace ageing electric storage heaters with community heating systems.

District heating loan fund helping to provide low cost heating in Wick

District heating loan fund supports sustainable local regeneration in Foyers

District heating loans evaluation

Heat network skills in Scotland report

The Heat Networks (Scotland) Bill was introduced to the Scottish Parliament by the Scottish Government on 2 March 2020 and formed part of the Scottish Government’s response to the global climate emergency.

The bill aims to stimulate the deployment of heat networks in Scotland by providing regulation, which will increase investor, consumer and supply chain certainty, as well as build trust in the sector.

Consequently, heating networks in Scotland are expected to create new demands on the supply chains needed to design, install, commission and maintain these networks.

Following a stakeholder workshop in November 2019,* which highlighted that there was a range of skills gaps (for example, design, installation and project management) that were creating challenges for the sector, Energy Saving Trust and the Scottish Government commissioned research to help identify the skills gaps and training needs of the heat network supply chain in Scotland.

*Including product suppliers, energy companies, local authorities, consultants and public sector organisations

You can read a full copy of the report.

Find out more about this research and what the key recommendations are.

Database of renewable heat installations

The Scottish Government had set a target for 11% of non-electrical heat demand in Scotland to come from renewable sources by 2020.

In order to help measure progress towards this target, we maintain a database of renewable heat installations on behalf of the Scottish Government. The database records installations known to be operating and those currently in various stages of development, and contains data on the capacity and yearly heat output of those installations.

Read the latest report.

The District Heating Loan Fund was funded by the Scottish Government.

Last updated: 25 April 2024