The Scottish Government has launched a new £2.3m fund to encourage the development of large scale water source heat pump schemes to lower carbon emissions.

The Water Source Heat Pumps Challenge Fund is part of the Low Carbon Infrastructure Transition Programme.

It will support the development of projects which require assistance to attract further investment, with an initial £375,000 being made available to help build investment grade business proposals.

A further £2m will be available to those with a fully developed investment grade business proposal, but who have been unable to secure private investment.

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Energy Minister Fergus Ewing said: "Supporting the development of district heating and wider low carbon technologies will help maximise the economic opportunities from Scotland's low carbon sector.

"Today I am pleased to announce that we are turning our attention to accelerating large scale Water Source Heat Pump Projects to support low carbon district heating schemes in Scotland.

"Heat is estimated to account for over half of Scotland's total energy use and responsible for nearly half of Scotland's greenhouse gas emissions, so the imperative to take action is very clear.

"We have already made significant progress and will continue to work together with energy experts, businesses and communities to move towards our target of having have 40,000 homes connected to district heating by 2020."

(LM/CD)