Life After The Public Sector Decarbonisation Scheme: What’s Next for Public Sector Decarbonisation?

Let’s not beat around the bush, the Public Sector Decarbonisation Scheme (PSDS) being pulled is a big deal. For years, it’s been the go-to route for public bodies trying to upgrade buildings, cut emissions, and avoid taking on debt. It didn’t suit every project, but it gave the sector confidence to act.

Now it’s gone. No extension. No phased wind-down. Just... gone.

So what does that mean for everyone trying to hit net-zero targets with ageing estates, tight budgets, and mounting political pressure?

Here's our take, and a few viable funding options that remain.

What does the end of the Public Sector Decarbonisation Scheme really mean?

From where we sit, this isn’t just about one scheme ending. It's a reflection of wider budget reshuffling and a changing attitude from central government.

The latest Spending Review suggests a shift toward public bodies doing more with less, putting value for money first and moving away from large grants. Capital-heavy schemes like PSDS were always going to be vulnerable in that climate.

The message is clear: if you want to decarbonise, you need a model that can either fund itself or deliver visible outcomes fast.

Why pausing projects is the wrong move

With PSDS gone, the temptation is to hit pause on everything and wait for the next funding pot.

That’s the wrong move.

There are still practical and scalable solutions to get projects moving, some even more flexible than PSDS ever was.

The key? Understanding what's available and which options make the most sense for your region or organisation.

Renewable Rewards: A Proven Funded Model

Let's start with something we know well - Renewable Rewards.

This is Smarta Energy's fully funded model solution delivering:

• Solar PV

• Battery Storage

• Low-carbon upgrades

With zero upfront cost.

• Not a loan.

• Not a lease.

• And not some complicated framework tie-in either.

Smarta Energy handles the design, installation, maintenance, and provides ongoing reporting and optimisation, and a share in the energy savings. Simple as that.

It’s ideal for sites where the need is urgent, but the capital just isn’t there. Think: fire stations, schools, police HQs, community buildings, we've seen it all.

We are not asking you to jump through a dozen hoops. We are here to help you take action now, without asking for a cheque upfront or tying you into 25-year agreements.

Smarta Energy: Renewable Rewards Process

What's still available in England?

If you’re based in England, your options without PSDS are still there, but they each come with trade-offs.

• Energy Performance Contracts (EPCs) - Good for large estates and internal capacity, but they tend to be big, slow, and not suited for quick wins.

  
  

• Public Works Loan Board - Offers low-interest borrowing, but at the end of the day, it's still debt. Not every finance director wants to stack more debt on the books.

  
  

• Local Salix Funding - Still around, but mostly allocated or used up.

  
  

• Community Municipal Investments (CMIs) - Local green bonds, but slow and admin-heavy. Sounds good on paper, but it can be a headache to set up.

In short, England still has tools in the box. But for quick, no-nonsense delivery? Funded models like Renewable Rewards are often the fastest route to impact.

What about Wales?

Wales has always done things a bit differently, and in this case, that’s a good thing. The Welsh Government Energy Service is still offering support. If you’ve got the time and resources to do proper planning, they are a solid partner.

We are also seeing movement towards more regional collaboration, such as shared procurement and net-zero hubs across councils and health boards. That’s promising. But again, it often takes time to unlock funding, and you still hit CapEx walls.

The best results? Hybrid models. Early-stage planning and support from the government, with Smarta Energy managing funding and delivery to bridge the CapEx gap.

That blend works well.

Scotland's Structured Approach

Scotland, in fairness, has a pretty mature system, with initiatives like:

• Scottish Futures Trust

• Net Zero Nation

• Route Map for Zero Emissions Buildings

All good stuff. But even here, the message is changing. Pressure is building for quicker results.

You’ve got to move quickly. You’ve got to show results. And if you’re sitting on a plan without the budget to act, you still need a way to get it done. That’s where we’re helping Scottish schools, housing associations, and councils, plugging the gap with delivery and funding, while long-term planning continues in parallel.

What you shouldn't do

Here's what our Director of Public Sector Partnerships, Sam Taylor, wouldn't recommend right now:

• Don’t wait around hoping another PSDS will appear.

• Don’t hit pause on everything ‘just in case’.

• Don’t assume the only option is to borrow or go through a national framework.

The public sector can’t afford to stall. Energy costs are still volatile, buildings are ageing, and net-zero deadlines aren’t going away. We’ve got to be more agile than that.

The organisations I see doing it well right now are taking a mixed approach. They’re pushing ahead with what they can fund internally. They’re using Renewable Rewards to get started where CapEx is a blocker. And they’re reserving grant or loan funding for projects that truly need it, like heat decarbonisation or fabric upgrades.

That’s the “Smarta” move. It keeps the wheels turning while still planning for the bigger picture.

What you should do

Yes, losing PSDS stings, but it is not the end.

The landscape is changing, but with the right funding models, smart partnerships, and clear action, the public sector can still lead the net-zero transition.

If you are unsure where to start, we are here to guide you, without upfront cost, red tape, or delays.

Ready to take action without the upfront costs? Reach out to Sam Taylor, Director of Public Sector Partnerships, to discuss your options.

Contact Sam Taylor Here