An update on the Public Sector Decarbonisation Scheme
The Public Sector Decarbonisation Scheme was launched in autumn 2020 and offers £1bn grant funding to decarbonise Public Sector buildings.
The application deadline has almost passed, but with hints of a new round of funding on the way, there may still be opportunities to benefit. Here’s our update on the scheme, and what’s next.
Is there still time to apply for the Public Sector Decarbonisation Scheme?
Technically, yes, although there is very little time left – the deadline for most organisations is 11th January 2021.
Salix, the scheme administrators, say they have already received applications totalling £1bn, and while applications are still open, they will close the scheme once all of the money has been allocated. They will prioritise projects that are able to be completed by 31st March 2021.
- If you’re seeking funding for low carbon heating technologies such as heat pumps and heat network connections (“category one” technologies) then it’s unlikely you will have time to develop a robust proposal ahead of the deadline, unless your feasibility study and business case is already well developed.
- If you’re seeking funding for “category two” and “category three” measures, there may be just enough time to arrange quotes from contractors to support your application, depending on the measure. Category two and three technologies do not directly contribute to the heat decarbonisation of a building, but reduce overall energy demand or enable future heat decarbonisation to take place. The full list of measures is on the Salix website, but examples include insulation, glazing, and lighting.
Do I need to have a Heat Decarbonisation Plan to apply?
Applications to fund only category two and three technologies come with more caveats than those including category one – these are explained on the Salix website and in our full guide. One such caveat is that you will be required to commit to producing a Heat Decarbonisation Plan by 30th September 2021, unless low carbon heating is already installed in the building.
The Plan should set out how the fossil fuel heating systems in your building(s) will be replaced by low carbon heating when the systems reach the end of their natural lifetime.
You can apply for funding to get external support with your Heat Decarbonisation Plan under the Low Carbon Skills Fund – which is running in tandem with the PSDS.
More about the Low Carbon Skills Fund
The Low Carbon Skills Fund (LCSF) was launched alongside, and is complementary to, the PSDS.
Whereas the PSDS provides capital funding, the LCSF funds specialist expertise to facilitate your capital project.
It’s too late to request LCSF funding to help you with project identification/development (that deadline passed on 4th December), but you can still seek funding for project delivery support and help with your Heat Decarbonisation Plan. However you have only until 11th January to apply.
It’s worth noting that you must apply for PSDS funding before you can apply for Heat Decarbonisation Plan funding under the LCSF.
Will there be more public sector funding in the future?
In its recent , the government said it would be providing more funding for the Public Sector Decarbonisation Scheme in 2021. This has not yet been confirmed or officially launched.
The timescales for the current round of funding have been short, and if timescales for future rounds are similar, they don’t allow time to develop proposals properly for heat pumps or heat networks to replace fossil fuel boilers from scratch.
So, if a new round of funding is confirmed, it makes sense to get prepared now by undertaking a feasibility study of your site to understand what decarbonisation technologies work best.
This also helps to ensure you get the maximum benefits from your project. Poorly planned heat pump or district heating schemes will operate with poor efficiency and therefore increased cost and it is important to fully consider insulation, ventilation and heat distribution.
What to do now – our recommendations
- There is still a very short window of time (until 11th January) in which to apply for PSDS funding to support installations. There could be enough time to apply for category one measures if your plans are well developed, or for simpler category two and three technologies such as lighting and insulation.
- You also have until 11th January to seek LCSF funding for external project delivery and the development of a Heat Decarbonisation Plan. This can only be applied for after you have applied for the PSDS
- To best prepare yourself for future rounds of funding, consider undertaking feasibility studies now, in order to understand the right heat decarbonisation options for your estate.
At Concept, we have been supporting clients on several aspects of the scheme, including feasibility studies and the development of Heat Decarbonisation Plans. For advice on the scheme and how we can help, get in touch. You can also read our full guide to the Public Sector Decarbonisation Scheme.