The Public Sector Decarbonisation Scheme explained

The Public Sector Decarbonisation Scheme (PSDS) is a UK government initiative aimed at helping public sector organisations reduce their carbon emissions and transition towards net zero. Through this scheme, public institutions can access funding to implement energy-efficient and low-carbon technologies in buildings. This guide will explain the PSDS, who it’s for and how public sector organisations can boost their efforts to decarbonise using it.

What is the Public Sector Decarbonisation Scheme?

The Public Sector Decarbonisation Scheme was launched by the UK government to help reduce carbon emissions in public buildings, which are responsible for a significant portion of the country's overall emissions. The scheme provides grants for public sector organisations to fund projects that install low-carbon heating systems, improve energy efficiency and implement renewable energy technologies.

The scheme is administered by Salix Finance on behalf of the government, and it is part of the larger effort to achieve the UK’s 2050 Net Zero targets. The PSDS plays a crucial role in decarbonising public sector buildings, aiming to cut emissions by 75% by 2037, compared to 2017 levels.

Who can apply for the Public Sector Decarbonisation Scheme?

The scheme is open to a wide range of public sector bodies, including:

• Local authorities: Councils can apply to decarbonise offices, schools, leisure centres and other public buildings.
• NHS Trusts: Healthcare facilities are a key focus, given the large amount of energy they consume.
• Schools and universities: Educational institutions, from primary schools to large universities, can benefit from funding to install energy-efficient systems.
• Government departments and agencies: Central and regional government offices are eligible for support​

These organisations can apply for funding to upgrade buildings by introducing heat pumps, solar panels, energy-efficient lighting, insulation improvements and more.

What does the PSDS fund?

The Public Sector Decarbonisation Scheme offers grants for a variety of carbon-reducing measures, including:

1. Low-carbon heating systems: Funding can be used to replace outdated boilers and heating systems with modern heat pumps or district heating schemes that rely on renewable energy​.
2. Renewable energy solutions: Organisations can install solar panels, wind turbines or other renewable energy technologies to generate clean energy and reduce reliance on fossil fuels.
3. Energy efficiency measures: This includes upgrading lighting systems, improving insulation and installing smart energy management systems to reduce energy consumption in public buildings.
4. Building retrofits: The scheme supports retrofitting older buildings to improve energy efficiency, reduce emissions and ensure that they comply with modern energy performance standards​.

Why is the PSDS so important?

Public sector buildings account for a significant portion of the UK’s carbon emissions. The scheme helps reduce this impact by promoting the adoption of low-carbon technologies. By upgrading to more efficient systems, public sector organisations can reduce their energy consumption, leading to lower energy bills and cost savings in the long term. Additionally, the public sector is seen as a leader in the fight against climate change. Through the PSDS, government bodies and public institutions can showcase best practices in sustainability and inspire others to follow suit​.

How to apply to the Public Sector Decarbonisation Scheme

To apply for the Public Sector Decarbonisation Scheme (PSDS), public sector organisations need to submit a detailed proposal outlining their plans to reduce carbon emissions in their buildings. Applications should focus on how the project will improve energy efficiency, reduce emissions and achieve cost savings. Key criteria include:

• Cost-effectiveness: Projects that provide significant carbon reductions relative to the amount of funding requested.
• Long-term impact: The sustainability of the proposed measures and the long-term benefits in terms of carbon savings and energy cost reductions.
• Scalability and feasibility: Projects that can be scaled or replicated across multiple sites, as well as those demonstrating clear feasibility in terms of implementation.

For organisations interested in securing funding, it’s important to act quickly. The deadline for applications is November 25, and proposals submitted after this date will not be considered​. Applicants should ensure that all necessary documentation, including energy performance data and a detailed financial breakdown, is submitted by this date.

Start your decarbonisation journey with Oakray Renewables

If your public sector organisation is considering applying for the Public Sector Decarbonisation Scheme, Oakray Renewables can help. Our expertise in renewable energy, low-carbon heating and energy efficiency solutions ensures that we can support you every step of the way, from planning and application to implementation.

Contact us today to learn more about how we can help you decarbonise your public buildings and take full advantage of government funding through the PSDS.