Public sector bodies abandoned one in six decarbonisation projects awarded funding through a £553m scheme, after “changes in the wider economic climate” took their toll.
Public sector bodies that received funds from phase 3a of the Public Sector Decarbonisation Scheme (PSDS) were forced to abandon 17 per cent of their projects, the latest report into public decarbonisation reveals.
A Department for Energy Security and Net Zero report said these schemes were “abandoned subsequent to receiving a PSDS grant offer letter”.
Phase 3a launched in October 2021, and in the following year it allocated funding to 231 projects run by 170 public bodies over the financial years 2022/23 to 2024/25.
The “majority” of the projects that received funds from the PSDS struggled with delays and cost inflation, according to the report.
Public sector bodies can get grants from the PSDS to fund heat decarbonisation and energy efficiency programmes across the UK. The government pledged £1bn to the scheme in its Autumn Budget last year.
The latest report reveals that, despite the struggles, most of the grant-funded projects were installed on time – by the deadline of 31 March 2023.
But clients on the scheme blamed “challenges in the wider economic climate” for their difficulties, as well as new carbon regulation rules.
The department gathered the data from five workshops and 100 qualitative and semi-structured inte