A quick guide to the new grant funding for public sector buildings
The Public Sector Decarbonisation Scheme (PSDS) launched in autumn 2020, and a new round of funding (Phase 3) opens on 6th October 2021.
The scheme aims to support the public sector in taking a ‘whole building’ approach to decarbonising heat in their estates.
Here’s our 3-minute guide to the scheme.
Phase 3 of the PSDS… in a nutshell
Decarbonising the way buildings are heated is one of the biggest challenges facing the UK as it aims to reach its ambitious 2050 net zero target. This is particularly true when it comes to public sector buildings which still largely rely on fossil fuel heating systems. As these systems come to the end of their useful life, it is an ideal opportunity for organisations to make the transition to low carbon heating.
The government launched Public Sector Decarbonisation Scheme in 2020, to fund low carbon heating projects in public sector estates. Projects should take a ‘whole building’ approach to heat decarbonisation, i.e. combine low carbon heating system upgrades with energy efficiency measures.
The scheme is managed by Salix and aims to put the public sector at the forefront of decarbonising buildings, showcasing projects that pave the way to help the UK meet its net zero target.
What projects can be funded under Phase 3 PSDS?
You can find a full list of technologies that are eligible for PSDS funding on the Salix website. Projects must include the replacement of fossil fuel heating systems (e.g. gas boilers) with low carbon heat sources, such as heat pumps or district heating connections. Existing heating systems must be coming to the end of their useful life.
The focus is on taking a “whole building” approach to heat decarbonisation, so these measures should be ‘bundled’ with energy efficiency measures such as insulation and building controls. The point is that the building should be made as efficient as possible before installing low carbon heating systems
Are there any new eligibility criteria?
There are two key new elements to Phase 3 of the scheme. First, there is no funding cap, so applicants can apply for any grant value they like. However, they must demonstrate in the application that they have the resource and supply chains required to deliver the project by the agreed dates.
Second, applicants can apply for multi-year funding. 15% of the funding is being allocated to more complex projects where boilers are expected to come to the end of their working lives in the next two or three years, and where the work to prepare the buildings for low carbon heating needs to start in the financial year 2022/23. For example, buildings may require significant upgrades to their fabric or electrical infrastructure before low carbon heating can be installed.
The full eligibility criteria list for Phase 3 PSDS can be found on the Salix website.
Who can apply?
- Central government departments and their arm’s length bodies
- Emergency services
- Institutions of further and higher education
- Local authorities
- Maintained schools within the state education system, including academies, Multi-Academy Trusts and free schools
- Nursery schools maintained by a local authority
- NHS Trusts and Foundation Trusts
Schools funded by charities, private schools, private colleges and private universities are not eligible to apply.
For central government departments where their roles are reserved, funding may be used for estates located within the UK.
Can I apply for funding again if I applied in previous phases?
Yes. However, projects funded under the first phase must continue to meet their deadlines.
How much can I apply for?
There is no cap on the amount of funding an applicant can apply for under Phase 3 of the scheme. However, you must demonstrate in the application that you have the resource and supply chains required to deliver the project by the agreed dates.
Does my organisation need to contribute to costs?
Yes. The PSDS funding is for costs over and above the like-for-like replacement costs of a fossil fuel heating system. So, you should expect to contribute costs equivalent to replacing your system with a conventional boiler.
When do I need to apply?
Applications open on 6th October 2021, and applications will be assessed in the order in which they are received, so it is best to apply early.
The application portal closes four weeks later, on Wednesday 3rd November 2021.
Applications should be for projects incurring costs no earlier than Friday 1st April 2022, and no later than:
Friday 31st March 2023 for single year projects
Sunday 31st March 2024 for two year projects
Monday 31st March 2025 for three year projects
For more information visit the Salix website.
