Public Sector Decarbonisation Scheme

£3.5 billion scheme focuses on the delivery of current projects - with no future funding available.

The government has announced that it has taken the difficult decision to commit no further investment for the Public Sector Decarbonisation Scheme beyond currently awarded projects.

Following this week’s government Spending Review, which outlined capital and day-to-day funding for government departments over the next three years, we can confirm there will be no additional funding for the Public Sector Decarbonisation Scheme. 

All currently awarded projects in the scheme remain fully funded.

We are currently delivering Phase 3c and Phase 4 of the Public Sector Decarbonisation Scheme and our work supporting these projects will continue until these projects are complete and operational.  For Phase 3c, projects, grant funding will continue until 31 March 2026 and for Phase 4 up until 31 March 2028. 

We look forward to working with organisations across England to deliver these energy-efficiency projects.

The Public Sector Decarbonisation Scheme is run by the Department for Energy Security and Net Zero and delivered by our teams at Salix.

It was launched in 2020 to support public sector organisations in England to install low-carbon heating and energy efficiency measures in their estates. These measures support public sector organisations to reduce their carbon emissions and their energy bills.

In total, more than £3.5 billion has been issued through nearly 1,400 Public Sector Decarbonisation Scheme grants up to the end of 2027/28. More than £1 billion of the Public Sector Decarbonisation Scheme budget will still be invested between now and 2028. 

Salix chief executive Kevin Holland said: “We’re proud to work with governments delivering key projects to reduce carbon emissions. 

“Every day our expert teams work across the public sector as well as the social housing sector to deliver project excellence and meet challenging net-zero targets.

“We remain committed to supporting our Public Sector Decarbonisation Scheme stakeholders as they pursue their Phase 3 and Phase 4 projects.

“We will continue to support these organisations, working with them to meet deadlines and to showcase the incredible work being achieved.”

The government remains committed to building on the existing Public Sector Decarbonisation Scheme and is looking at ways to incentivise the public sector as a whole to take steps to decarbonise. 

At Salix, we use our expertise and knowledge every day to guide organisations through complex net zero challenges, ensuring the best value for money and high-impact outcomes. Our professional teams in finance, energy, technology and delivery will support organisations to explore potential new pathways to decarbonisation.