The Government has announced that the third round of PSDS funding will open for applications on 6th October, which is fantastic news for public sector organisations looking to decarbonise, but you need to act quickly to secure the funding.
PSDS funding is delivered as a non-repayable grant and is a fantastic opportunity for public sector organisations who don’t have all of the required budget to self-fund the development and delivery of decarbonisation projects, but first they must successfully navigate the applications process.
The priority for PSDS round 3 is to provide funding to replace fossil fuelled heating systems at the end of their working lives, such as gas boilers, and replace them with low carbon heat sources combined with additional energy efficiency measures, to facilitate a ‘whole building’ approach to heat decarbonisation.
Once the total budget for round 3 is confirmed, the majority of the 2022/23 grant funding will be allocated to projects that need to be undertaken between 1st April 2022 and 31st March 2023, where the heating system has reached the end of its working life. A smaller proportion of the funding has been set aside to specifically support multi-year decarbonisation projects where heating systems that are expected to reach the end of their working lives in 2023/24 or 2024/25, but decarbonisation work must start in 2022/23.
With short timescales, predicted over subscription, and Salix Finance (who manage the funding) stating that projects will be assessed in the order in which they’re received, organisations could be forgiven for feeling that the clock is already ticking. Early engagement from an energy specialist, such as Vital Energi, is recommended as it can bring the specialist skills and knowledge necessary to develop a viable suite of projects across a property portfolio.
We have partnered with several clients to support their application, and whilst they must submit the material themselves, we can review the feasibility of range of decarbonisation measures, develop design and costings and energy and financial modelling to develop the information that needs to be submitted. In PSDS round 1, our clients received over £100m in funding, which represented over 10% of the total fund, and we hope to create similar partnerships in round 3. This is a great opportunity for public sector organisations to decarbonise their estate, and PSDS provides a key way of unlocking the incremental funding needed to make these projects a reality.