This study enhances the classical energy norm based adaptive procedure by introducing new refinement criteria, based on the projection-based interpolation technique and the steepest descent method, to drive mesh refinement for the scaled boundary finite element method. The technique is applied to p-adaptivity in this paper, but extension to h- and hp-adaptivity is straightforward. The reference solution, which is the solution of the fine mesh formed by uniformly refining the current mesh, is used to represent the unknown exact solution. In the new adaptive approach, a projection-based interpolation technique is developed for the 2D scaled boundary finite element method. New refinement criteria are proposed. The optimum mesh is assumed to be obtained by maximizing the decrease rate of the projection-based interpolation error appearing in the current solution. This refinement strategy can be interpreted as applying the minimisation steepest descent method. Numerical studies show the new approach out-performs the conventional approach.