New Scotland grant funding to decarbonise public sector buildings

A new funding scheme has been launched for Scotland offering up to £20 million in grants to support local authorities, universities and arm’s-length external organisations to decarbonise their buildings.

Scotland’s Public Sector Heat Decarbonisation Fund, which will be delivered by Salix.

The new scheme is intended to increase the number of public sector organisations taking forward heat decarbonisation measures in their buildings.

Scotland’s Public Sector Heat Decarbonisation Fund will run alongside the existing Scottish Energy Efficiency Loan Scheme, which has been running since 2006 and offers zero interest loans for energy efficiency improvement projects.

The existing loan scheme will continue as normal.

The funding forms part of the £200 million already committed to the public sector for energy efficiency and renewable heating over the next five years - part of the wider plan to spend £1.8 billion in this current parliamentary session on decarbonising Scotland’s buildings.

Zero Carbon Buildings Minister Patrick Harvie said:

“Scotland’s buildings account for approximately a fifth of all our emissions and our aim is to ensure that, by 2045, our buildings no longer contribute to climate change. This means that our schools, offices, hospitals, libraries and homes will all need to improve their energy efficiency and install zero emissions heating.

“Public sector bodies have already achieved a lot, but we need to go further. The design of the new scheme reflects the changing needs of the sector, allowing public sector organisations to invest in projects with higher capital costs and which cannot always be invested in on a spend to save basis.

“Moving from a loan scheme to direct grant awards for the first time represents a very significant commitment from the Scottish Government to support the delivery of these challenging targets.”

Salix Finance Chief Executive Annie Shepperd said: “Salix is immensely proud to be delivering Scotland’s Public Sector Heat Decarbonisation Fund.

“Not only will this help Scotland move faster with its net zero ambitions, but it will create better buildings for people to use.

“This is good news for Scotland. In the last few years we have seen the Scottish Government’s influence on international climate change grow.

“And now our Salix teams will be working ever more closely with Scottish Government to support its decarbonisation journey, we are committed to this work.”

How it works:  As per the criteria for the previous scheme, only public sector bodies with borrowing powers can apply to the new fund. Applicants will be required to provide 20% match funding for projects.

Background: Scotland’s Public Sector Heat Decarbonisation Fund is being delivered on behalf of the Scottish Government by Salix Finance, which operates the existing Scottish Energy Efficiency Loan Scheme.

More than £75 million has so far been invested in energy efficiency projects in Scotland through the existing scheme, which is forecast to save the public sector more than £202 million over the lifetime of the projects.

Applications will open via the Salix Finance website later this summer.

Announcements regarding future funding will be made in due course.

Salix will be publishing scheme Guidance Notes for Scotland’s Public Sector Heat Decarbonisation Fund and other information in due course. Please refer to our website regularly and subscribe to our Salix news updates.