Salix announces Phase 4 of the Public Sector Decarbonisation Scheme

 
 
 

On 23 September 2024, Salix announced Phase 4 of the Public Sector Decarbonisation Scheme.  The fund will focus primarily on the decarbonisation of heat. The application portal opened on Wednesday 9th October and will close on Monday 25th November.

What is Phase 4 of the Public Sector Decarbonisation Scheme (PSDS)?

Phase 4 of the Public Sector Decarbonisation Scheme will provide funding for public sector organisations looking to improve their energy efficiency as well as reduce carbon emissions in their buildings.

The scheme offers grant funding to public sector organisations in England and those with reserved functions in devolved administrations to install energy-efficient measures and decarbonise heating systems. The Department for Energy Security and Net Zero will release funding for projects from 2025/26 to 2027/28, with further details to follow.

Key Features

  • Eligibility: Open to public sector organisations in England or those with reserved functions in devolved administrations. Buildings must either be owned or leased, with responsibility for maintenance on the applicant. Buildings under Private Finance Initiative (PFI) agreements are also eligible.

  • Heating Systems: The existing heating system must be fossil fuel based and over 10 years old.

  • Contribution: A 12% contribution from the applicant is required to support a like-for-like replacement of the fossil fuel system.

  • Additionality: Projects must be new and not legally required.

  • Whole-Building Approach: Applicants should consider energy efficiency and building fabric improvements to reduce heat and energy demand.

  • Low-Carbon Heating: All projects must include low-carbon heating systems; fossil fuel-reliant technologies are not eligible.

What are the timescales?

  • Applications open: Wednesday 9th October 2024

  • Applications Close: Monday 25th November 2024

  • Funding Decisions: May 2025

  • Project Completion: 31 March 2028

Single year projects must be completed by 31 March 2026. Multi-year applications are for projects which will take more than one financial year to deliver and are required to complete by 31 March 2028.

What’s different from previous Phases?

  • Targeted Allocation: In previous phases, funding was awarded on a first-come, first-served basis. Instead, applications will be prioritised based on their “grant carbon cost” (grant value divided by carbon savings) meaning that lower carbon costs have a higher chance of receiving funding.

  • Grant Carbon Cost: Projects must have a grant carbon cost of no more than £510 per tonne of carbon saved in order to qualify.

  • Updated Public Sector Definition: Applications will need to align with the Procurement Act 2023, which may affect the eligibility of some higher education institutions.

What’s the same?

  • The scheme is open to the whole public sector.

  • Applications can still be combined with other technologies (such as LED lighting, Solar PV) as part of a “whole building” approach, where they are supporting the heat decarbonisation project.

  • The additional criteria are the same i.e., the project must not have already started. 

What do we do next?

Careful consideration will need to be given to identifying suitable projects.

  • Have you got a heating system at the end of its useful life?

  • Were you intending to replace the system in the next 1-3 years?

  • Do you have the funds to carry out a “like for like” replacement?

  • Do you have a developed feasibility, design or Heat Decarbonisation Plan?

If yes, you may be eligible to submit an application. Dukefield Energy can assist with this process. Dukefield Energy can also support with developing a Heat Decarbonisation Plan.

If you would like to discuss your project, please contact us.

info@dukefieldenergy.co.uk

0345 4022 461


 
Daniel Lunn