Public Sector Decarbonisation Scheme (PSDS)
Funding large-scale energy efficiency and low‑carbon upgrades in public buildings to drive net‑zero outcomes.
Making public buildings more sustainable
The Public Sector Decarbonisation Scheme (PSDS) is a UK Government grant programme that funds low-carbon heating and energy efficiency upgrades in public sector buildings. Administered by Salix Finance on behalf of the Department for Energy Security and Net Zero (DESNZ), it helps organisations replace ageing fossil fuel systems and reduce their carbon footprint.
How the scheme works
PSDS is delivered in phases:
- Phase 1 (2020–21 & 2021–22): £1 billion in grants to launch retrofit efforts.
- Phase 2 (2021–22): Further £75 million with a focus on heat decarbonisation.
- Phase 3 (2022–25): £1.425 billion distributed across multiple application windows—Phase 3a launched in late 2021, followed by 3b and 3c.
Phase 3c alone allocated around £611 million across 209 public sector projects—with an average grant value exceeding £2.5 million per project.
Phase 4 (2025–28) has been confirmed in principle, with funding to be allocated across those financial years. Applications closed in November 2024, and grant offers are expected to be issued by approximately May 2025.
Eligibility and funding
The scheme is open to public sector bodies in England, including:
- Local authorities.
- NHS Trusts.
- Schools, academies, and universities.
- Emergency services.
- Central government departments.
Some organisations in devolved regions may also be eligible if they are responsible for reserved functions.
Funding levels vary by phase and project size. There is no strict per-property cap, but all projects must meet value-for-money requirements. In recent phases, grants have ranged from hundreds of thousands to several million pounds per project, depending on scope and scale.
Our role in delivery
While we don’t manage PSDS applications, we work with successful applicants to deliver their projects to the highest standard. We:
- Ensure all works meet the technical requirements of the funding.
- Manage installations to minimise disruption.
- Communicate clearly with building users and stakeholders.
- Provide full compliance documentation for grant claims.
Why Work With LMF?
We’re not just an installer — we’re a long-term delivery partner for social housing providers seeking impact, compliance, and value.
- Award-Winning, Accredited Installer - With over 30 industry awards and accreditations including TrustMark, PAS 2035, MCS, and NAPIT, we’re trusted by councils, housing associations, and energy suppliers nationwide.
- Experienced in Social Housing Delivery - We understand the unique challenges of social housing, from compliance to resident care. Our teams are trained to work respectfully in occupied homes and vulnerable households.
- Scalable, End-to-End Service - From small-scale programmes to multi-site rollouts, we provide a complete solution — from initial assessments to funding, installation, and compliance.
- Dedicated Project Teams - You’ll have a single point of contact backed by a multi-disciplinary team, including retrofit coordinators, surveyors, and resident liaison officers.
- Transparent Reporting and Compliance - We provide clear documentation, post-installation reporting, and ongoing support to help you meet your obligations with confidence.
