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Government drops PSDS funding route

13/06/2025

News

You might have seen the recent announcement from Salix regarding future funding for the Public Sector Decarbonisation Scheme (PSDS). Whilst the news is in its infancy, we at Eddisons are keen to assure our clients of what this currently means.

The government's drive to meet Net Zero 2050 still exists, and the government have to finance the schemes and developments needed to achieve that goal. We at Eddisons believe that their efforts to reach Net Zero have not been strong enough, but this update suggests that the government is realigning its budgets to ensure that the allotted money goes further.

As the government look to reduce their overheads, we must remember that the public sector's commitment to decarbonisation will continue, and the work already in progress will deliver long-term benefits, from lower carbon emissions to scalable financial savings across estates. However, it is not just a job for parliament; we as citizens have an obligation to make this work.

The funding will not stop, but the process will change

Salix has commented that new funding beyond what has already been awarded isn't currently planned. However, it's important to remember that over £1 billion is still being invested between now and March 2028. Projects funded under Phase 3c and Phase 4 are fully supported and progressing rapidly.

Some organisations may want to reassess their current plans. This could be a great opportunity to refocus and renew your strategy.

We have seen great efforts from West Midlands and Great Manchester combined authorities, which have their own pilot schemes for funding public sector decarbonisation and locally administer them, holding more power over how they are spent.

We feel that more public sector bodies will adopt this approach, as opposed to using ‘arm’s length’ bodies such as Salix.

There are also other funding opportunities available outside of the public sector, and it is up to us at Eddisons to identify the best ones for our clients. Speak to us to find out about those alternative avenues.

Next steps

Both the Department for Energy Security and Net Zero (DESNZ) and the government as a whole continue to support the public sector in exploring new solutions for decarbonisation.

As your consultancy, we're here to guide you through this next stage:

  • For funded projects: We'll ensure your projects are delivered on time and within budget, with minimum disruption.
  • For future plans: We'll collaborate with you to explore alternative options, whether that is planning, funding, or developing robust business cases that align your corporate and Net Zero goals.

Our focus has always been fabric first and reduction in building energy efficiency into our estates and stock.

The desire for decarbonisation is still there, and we are just as committed to help you achieve it. If you're considering how this might impact your plans, get in touch.

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