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Administrative timetable

Request from DESNZ

23 May 2024: The Subsidy Advice Unit (SAU) has accepted a request for a report providing advice to the Department for Energy Security and Net Zero (DESNZ) concerning its proposed Social Housing Decarbonisation Fund Wave 3 (SHDF Wave 3). This request relates to a Subsidy Scheme of Particular Interest.

The SAU will prepare a report, which will provide an evaluation of DESNZ assessment of whether the scheme complies with the subsidy control requirements (Assessment of Compliance). The SAU will complete its report within 30 working days.

Information about the scheme provided by DESNZ

The Social Housing Decarbonisation Fund (SHDF) programme, which is being delivered in Waves, supports the ambition set out in the Clean Growth Strategy, that as many homes as possible are improved to Energy Performance Certificate (EPC) Band C by 2035, and for all fuel-poor homes to reach this target by 2030. Previous Waves of the SHDF include the Demonstrator, Wave 1, Wave 2.1 and Wave 2.2. SHDF Wave 3 is the scheme referred to the Subsidy Advice Unit. 1.21 billion will be spent on SHDF Wave 3 (including through devolution settlements).

The policy objective of the SHDF is to improve the energy performance of social homes to EPC Band C or above. Improving the energy performance of homes is the most effective way to reduce carbon emissions and reduce fuel bills. The SHDF aims to make homes warmer, reduce carbon emissions and improve the comfort, health and well-being of social housing tenants, as well as reducing fuel poverty through reducing energy bills. The specific policy objective of SHDF Wave 3 is for 1.21 billion to be allocated to social housing landlords, which in combination with co-funding from landlords, will enable the energy performance of at least 140,000 social homes to be improved to EPC Band C.

Local Authorities, Combined Authorities, Registered Providers of social housing and Registered Charities that own social housing can apply directly, or as part of a consortium, for funding under SHDF Wave 3 to support the installation of energy performance improvement measures in social homes in England. Arms length management organisations that are not registered providers, can apply as part of a consortium led by an organisation that is eligible to lead an application.

Funding will be available for any energy efficiency and heating measure compatible with the Standard Assessment Procedure that will help improve the energy performance of homes, excluding heating systems which are solely fueled by fossil fuels. Applicants are expected to focus on measures that will help lower household energy bills and reduce carbon emissions from social homes. This includes, but is not limited to, energy efficiency measures (such as wall, loft, and underfloor insulation) and low carbon heating technologies. DESNZ will assess applications against the criteria set out in the SHDF Wave 3 competition guidance to determine whether funding will be awarded to the applicant.

All grant recipients will be eligible to receive up to 7,500 grant funding for each home, averaged across all the homes included in the application. 20,000 of grant funding is available for the installation of low carbon heating in homes on the gas grid (for 10% of total homes), and an additional 7,500 of grant funding is available for the installation of low carbon heating in homes off the gas grid. There is no limit on the size of grant that can be bid for, however grant recipients will be required to provide match funding that is equal to any grant funding received. Wave 3 is expected to open for applications in Summer 2024 and successful applicants announced in Autumn 2024. The Wave 3 delivery window is expected to last for 4 years up to September 2028.

Information for third parties

If you wish to comment on matters relevant to the SAUs evaluation of the Assessment of Compliance concerning DESNZ proposed SHDF Wave 3, please send your comments before 5pm on the date stipulated in the timetable above. For guidance on representations relevant to the Assessment of Compliance, see the section on reporting period and transparency in the Operation of the subsidy control functions of the Subsidy Advice Unit.

Please send your submissions to us at: SAU-SHDFWave3@cma.gov.uk copying the public authority shdfwave3enquiries@energysecurity.gov.uk.

Please also provide a contact address and explain in what capacity you are making the submission (for example, as an individual or a representative of a business or organisation).

Notes to third parties wishing to make a submission

The SAU will only take your submission into account if it can be shared with DESNZ. The SAU will send a copy of your submission to DESNZ together with its report. This is to allow the public authority to take account of the submission in its decision as to whether to create or modify the scheme or its assessment. We therefore ask that you provide express consent for your full and unredacted submission to be shared. We also encourage you to share your submission directly with DESNZ using the email address provided above.

The SAU may use the information you provide in its published report. Therefore, you should indicate in your submission whether any specified parts of it are commercially confidential. If the SAU wishes to refer in its published report to material identified as confidential, it will contact you in advance.

For further details on confidentiality of third party submissions, see identifying confidential information in the Operation of the subsidy control functions of the Subsidy Advice Unit.

Contacts

SAU project team: SAU-SHDFWave3@cma.gov.uk

CMA press team: 020 3738 6460 or press@cma.gov.uk