The case for deploying energy conservation measures and onsite renewables is compelling, particularly with high energy prices being the new normal and the need to hit net-zero targets.
However, one hurdle that can derail a project is the availability of finance.
OnGen has collated a number of funding sources that can help that could add weight to the business case for deployment.
England
Public Sector Decarbonisation Scheme
- Up to £335 million is currently being allocated to the second year of Phase 3c.
- Guidance for Phase 4 applications will be published in Summer 2024.
- £1.17 billion in funding was confirmed in December 2023 for the PSDS and will be distributed as follows:
- £670 million in 2025 to 2026
- £300 million in 2026 to 2027
- £200 million in 2027 to 2028
- The aim of the scheme is to help public buildings decarbonise their heating by replacing end-of-life boilers with heat pumps.
SME Energy Efficiency Scheme (SMEES)
- For businesses located in Tees Valley.
- Funding available for businesses wanting to improve their energy efficiency.
- Capital grants used to lower GHG emissions and lower energy consumption
- Covers up to 45% of the upfront cost of the project, between £10,000 and £100,000.
Coventry and Warwickshire Green Business Programme
- Specifically for SMEs in the regions of Coventry, North Warwickshire, Nuneaton and Bedworth, Rugby, Leamington Spa, Stratford on Avon, and Warwick.
- Grants between £1,000 and £50,000 (up to 40% of the total project cost) for organisations of no more than 249 employees.
- Funding will mean SMEs can access energy efficiency grants, the Green Business Network, a free energy audit, and support to improve their energy efficiency and low-carbon technologies.
Green Heat Network Fund (GHNF)
- Grant funding that will support new low and zero carbon heat network projects and retrofitting and expansion of existing heat networks.
- Open for public, private and third sectors in England.
- £288 million in funding is available with the scheme running up to 2027-2028.
Scotland
The Scottish Recycling Fund
- Grant funding for retrofitting of energy efficient measures to support the Scottish Government’s carbon reduction target.
- Aims to increase long-term investment into energy-efficient technologies throughout the public sector.
- 100% interest-free repayment.
- Any financial savings generated by the projects will be reinvested into further eligible projects, hence why it is called the recycling fund.
Scottish Public Sector Energy Efficiency Loan Scheme
- 0% interest loan for public sector bodies funded by the Scottish Government.
- Loan value up to 75% of the total project cost.
- Part of the Scottish Public Sector Energy Efficiency Loan Scheme launched in June 2021.
- The scheme will run for 5 years from June 2021.
- Supports energy efficiency improvement projects.
- £75 million has been invested by Salix since 2008, saving more than £200 million over the lifetime of projects.v
SME loan scheme
- Funded by the Scottish Government.
- Up to £100k loans available and £30k cashback grants.
- Can be used for financing the installation of energy efficiency measures, systems, equipment, and building fabrics.v
- Must be a small or medium sized enterprise, not-for-profit, or charity.
- Cashback grants available:
- 75% of costs can be covered up to £20k for energy efficiency measures.
- 75% of costs can be covered up to £10k for renewable heating measures including heat pumps, biomass heat, and solar thermal.
- Please note that due to the high number of applications related to solar PV, the Scottish Government is currently not accepting applications for projects of this nature.
Wales
The Wales Funding Programme
- For public sector businesses in Wales.
- 100% interest-free loans to support public bodies to contribute towards Wales’s 2030 net zero target.
- Aid for energy efficiency projects and renewable projects.
Business Wales
- Government funded organisation.
- Finance finding tool embedded within the website to help businesses locate the correct funding opportunities.
UK Wide
Barclays Green Loan
- Borrow up to £5 million to fund sustainable projects and green energy for your business.
- Help for improving EPC ratings.
- The length of the contract will affect the interest rate you pay.
- Capital repayment holiday available.
- Variable or fixed rate interest available.
- Flexible repayment.
- Your business must have fewer than 250 employees and a turnover less than £25 million.
NatWest Green Loan
- Eligible for projects relating to energy efficient retrofits, clean energy (renewables and energy storage systems), and clean transport (EV technology).
- Borrow from between £25,001 and £10 million.
- Repayments between 3 months and 25 years.
- Repayment holidays available.
- Fixed interest rate or variable rate with no upper limit.
Green Asset Finance with Lombard
- Helps businesses to invest in a wide range of sustainable assets, including onshore wind, CHP, battery storage, biomass boilers, LED lighting, EV chargers, roof and ground mounted solar arrays.
- There are different finance options available including:
- Hire purchase: spreading the cost of the asset, having the option to own it at the end of the contract.
- Residual Value Lease: benefit from the ownership of the asset without the depreciation risks of disposal costs.
- Finance Lease: lease high-value equipment with lower repayments and reduced risks.
RBS Green Loan
- Support for a range of sustainability projects including retrofitting, renewable energy generation, agriculture, and clean transport.
- Start borrowing anything from £25,001 with fixed and variable interest rates.
- Repayments between 3 months and 25 years.
- Repayment holidays available.
Lloyds Bank Clean Growth Financing Initiative
- Discounted lending to businesses for sustainable purposes.
- Anything from small scale improvements to reduce a business’s environmental impacts, up to large scale renewable energy projects.
- For any business with an annual turnover of between £3 million to over £25 million.
HSBC Green SME Fund
- Eligible uses for this loan include renewable technologies, energy efficiency improvements and climate change adaptation.
- Eligible for UK businesses with an annual turnover of up to £25 million.
- Loans of between £1,000 and £50,000 are available for asset finance, with a maximum potential loan value of £300,000.
Horizon Europe Funding
- Funding provided for any type of organisation across Europe and the world.
- Some funding options will allow for a single organisation to apply, although some options will require a team or partner organisations to form a consortium.
- Usually, a consortium consists of 3 organisations from different countries.
- Funding can be provided for:
- Projects that include groundbreaking research or new technologies.
- Project which improves research training and development, or research infrastructure.
- Projects that respond to challenges such as climate change.
Boiler Upgrade Scheme (BUS)
- Aims to help support the decarbonisation of heat in UK buildings.
- Upfront capital costs provided to support the installation of heat pumps and in some cases, biomass boilers in homes and non-domestic buildings in England and Wales.
- £5,000 off air source heat pumps, £5,000 off a biomass boiler (rural areas only), and £6,000 off the cost and installation of ground source heat pumps, including a water source heat pump. Sizing is capped at 45kW.
- £450 million of funding is available between 2022-2025. When this runs out, the scheme will end.
Check with your local council to determine if they offer funding/grants for a energy efficiency or renewable energy related projects.
