More funding for public sector to lower energy use and cut carbon emissions

More schools, hospitals and other public buildings will be able to reduce energy use, save on bills and cut carbon emissions for the long-term through the latest round of funding from the Public Sector Decarbonisation Scheme.

Public sector organisations can bid for a cut of £230 million of government funding to support significant low-carbon energy upgrades to their buildings, ranging from heat pumps and solar panels, to new energy efficiency measures such as insulation and low-energy lighting.

The opening of the latest bidding process coincides with the 3-year anniversary of the scheme, which has so far allocated more than £2 billion to almost 1,000 public sector organisations across England, helping them reduce energy bills and carbon emissions in the long term.

The funding marks another step in the government’s pragmatic and proportionate approach to reaching net zero, by scaling-up energy efficiency of buildings across the country and supporting the switch to more low-carbon heating.

The commitment follows significant progress the UK has already made towards reaching net zero - cutting all emissions by 48% between 1990 and 2021, which is faster than any other G7 country. Decarbonising the public sector with low carbon heating and energy efficiency measures is also expected to save the public sector an estimated £650 million per year on average to 2037.

Lord Callanan, Minister for Energy Efficiency and Green Finance, said: “We are a world-leader when it comes to reducing carbon emissions - and for us to reach our goal of net zero by 2050, we want to help public bodies like schools and hospitals to do their bit.

“We’ve made fantastic progress so far, helping more than 1,000 schools, hospitals and leisure centres. Today’s funding will now help even more organisations across England bring their bills down, while also cutting their emissions.”

The funding has been made available through Phase 3c of the scheme, with organisations able to spend the money allocated in the 2024 to 2025 financial year – on top of further funding for 2025 to 2026.

Organisations that have benefited from a share of more than £2 billion under the scheme over the past 3 years include:

• University Hospitals Coventry and Warwickshire NHS Trust have saved £54,500 on their annual energy bill thanks to a new air source heat pump at the Hospital of St Cross in Rugby and new solar panels and pipework insulation
• Staffordshire County Council have installed air source heat pumps and solar panels at the new Kingston Centre in Stafford. The school will also receive new energy efficiency measures, including a building energy management system, LED lighting, double glazing, roof insulation, cavity wall insulation, and pipework insulation. This is due to save them £79,700 on their annual energy bill
• Upper Norwood Library and the Waterloo Action community centre in the London Borough of Lambeth will see their energy efficiency improved – saving the council £5,200 on their annual energy bill. Air source heat pumps were installed at both sites, alongside LED lighting, double glazing, insulation and building energy management systems. Solar panels have also been installed at the Waterloo Action community centre

The Public Sector Decarbonisation Scheme aims to support the government’s commitment to reduce emissions from public sector buildings by 75% by 2037, compared to 2017 levels, as first set out in the 2021 Heat and Buildings Strategy.

Ian Rodger, Director of Programmes at Salix, said: “Salix is delighted to be delivering the next phase of the Public Sector Decarbonisation Scheme to support public sector bodies in their net zero transformation journey. The scheme is empowering organisations across England to make significant reductions in their carbon footprint from heating public buildings.   

“The huge enthusiasm for the scheme shows how much public sector bodies care about their carbon emissions and Salix is proud to be able to support them with finance and technical support to achieve their ambitions.”