Appearing in front of the Holyrood Conveners’ Group, the First Minister said the question of how Scotland and its public bodies would pay for the estimated £33bn project is going to be challenging.
Plans from the Scottish Government aim for more than a million homes and a further 50,000 non-domestic buildings to be using low and zero emission heating systems by 2030, to help Scotland meet its Net Zero targets.
Ms Sturgeon said private financing would be “levered in” to help pay for the work, which local authorities have previously said they cannot afford to do as they grapple with what they label a budget cut from the SNP.
Questioning the First Minister on the plans, Dean Lockhart, convener of the Net Zero committee said: “It’s estimated the retrofitting and decarbonisation of buildings by 2030 will cost more than £33 billion.
“How will this be funded?”
Ms Sturgeon said the plans were a “massive obligation” and rejected the suggestion councils are facing a budget cut from the SNP.
She said: “This is a massive obligation, it is central to meeting our overall Net Zero targets.
“Public money will be a key part of how we fund that and we have already made commitments to funding for the duration of this parliament.
“It’s one of the key issues in our spending review considerations right now and it will be issues for future parliaments as we go towards that 2030 milestone.
“But we will also have to work to leverage in private sector investment and that also is a key focus of what we are doing.
“And our efforts have to minimize the financial burden on individuals.”
Mr Lockhart suggested that work on retrofitting would have to start “now, effectively” if targets are to be met.
He said private investment for this work would have to secured within the next two or three years at the latest, adding he was not convinced Ministers were doing enough to ensure this was secured.
The First Minister said: “These plans are well underway within the Scottish Government. We’ve made significant commitments to public funding as a contribution to this over this parliament.”
“I think there would be very interesting and technical debate we could have and would probably need others to contribute to it on the phasing on this that will be needed between now and 2030.
“I do concede your point that much of this will be front-loaded in terms of the infrastructure that is needed.
“I’m not telling anybody anything they don’t know – but this is one of the most significant and difficult challenges we face but not meeting it is not an option.”
The SNP leader was also questioned on whether her party’s shift from a publicly owned energy company to an agency was a “credible” policy, given the fact it will be a “virtual agency with no additional staff, no additional budget, and no additional resource ”.
Ms Sturgeon said the “changing situation” around energy led the government to change its plans and said it would be “very clear” about how the agency will help meet Net Zero targets.
Want to hear more from The Scotsman’s politics team? Check out the latest episode of our political podcast, The Steamie.
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