Wave 3 of rebooted SHDF opens for applications on 30 September

Warm Homes: Social Housing Fund

 

Several changes have been made to Wave 3 of the scheme, including the introduction of a new cost cap and two new application routes.

 

Each home has access to £7,500 of grant funding but applicants are required to contribute at least as much co-funding as grant funding used on each home. There is an additional £7,500 of grant funding available if the grant recipient installs low-carbon heating measures in homes off the gas grid.

 

The two new routes to access funding under WH:SHF Wave 3 are the ‘Challenge Fund’ and via strategic partnerships. Individual and consortium applications will be permitted through both routes.

 

All applications that meet the minimum standards of the Challenge Fund will be awarded funding. However, if oversubscribed, this may not be the full amount of funding requested. This model will facilitate the phased approach to delivery taken by many organisations, DESNZ said.

 

The department said organisations with a “proven track record of successful delivery” and whose applications display ambition aligning with the government’s strategic priorities, including delivery at scale, can access funding through a strategic partnership.

 

DESNZ said, to reflect the capability evidenced by these organisations and to support delivery at scale, these grant recipients will not be required to provide detail on specific homes and measures until works are being carried out, as part of routine delivery monitoring.

 

Applications for Wave 3 of the Challenge Fund must include a minimum of 100 eligible social housing properties at EPC Band D to G per application. There is an exception in the case of small social housing landlords, defined as those which own or manage fewer than 1,000 homes. These can apply with fewer than 100 homes and for such landlords, there is no minimum application size.

 

Meanwhile, DESNZ said strategic partnership applicants will be expected to propose projects which display “ambition” aligning with the government’s strategic priorities, including delivery at scale.

 

The SHDF was launched in 2020 with the promise of £3.8bn over a 10-year period. Three waves of funding have been allocated, after an initial £61m demonstrator fund.

 

SHDF Wave 1 improved energy performance in up to 20,000 social housing properties and Wave 2.1 awarded £778m of an available £800m of government funding in March 2023. Wave 2.2 then launched as a ‘top-up’ competition in March 2024 and allocated over £75m.

Energy efficiency targets

 

The last government said the application dates were expected to be announced in the summer, but the new Labour government has announced the opening of the scheme this month alongside the launch of its Warm Homes Plan.

 

Within the announcements, the government said it will “now shortly consult” on proposals for private and social rented homes to achieve EPC Band C or equivalent by 2030, as promised in its manifesto.

 

A spokesperson from DESNZ told Social Housing: “We will be consulting by the end of this year on our plans for all private and social rented homes to achieve EPC Band C or equivalent by 2030, which is expected to lift over one million households out of fuel poverty.”

 

The previous government had confirmed in October 2023 that it would launch a consultation on minimum energy efficiency standards for the sector in England by early 2024, but this did not happen. The government had previously vowed to launch a consultation on improving energy efficiency in social housing within six months of the Social Housing (Regulation) Bill becoming law.

 

Now, DESNZ has said that currently, private rented homes can be rented out if they meet EPC Band E, while social rented homes have no minimum energy efficiency standard at all. There is a 2030 target for ‘fuel-poor households’, but this places no obligation on social housing landlords to achieve this.

 

Other schemes

 

DESNZ has also announced a new Warm Homes: Local Grant scheme and confirmed the continuation of the Public Sector Decarbonisation Scheme (PSDS).  

 

Warm Homes: Local Grant, which replaces the Local Authority Delivery Scheme, will begin delivery in 2025. It will provide energy performance upgrades and low-carbon heating via local authorities, to privately owned low-income households in England that have an EPC rating between D and G.

 

An expression of interest window is expected to open in October 2024.

 

Meanwhile, PSDS supports public buildings such as schools and hospitals to switch to cleaner heating and cut their emissions, accelerating to net zero.

 

DESNZ said that over one million households are set to be lifted out of fuel poverty via its plans for the “biggest potential boost to home energy standards in history”.

 

“Today’s announcements kickstart delivery of the government’s Warm Homes Plan, which will transform homes across the country by making them cleaner and cheaper to run, from installing new insulation to rolling out solar and heat pumps,” the department said.

 

‘Hugely welcome’

 

Rachael Williamson, head of policy and external affairs at the Chartered Institute of Housing (CIH), said it is “hugely welcome” that government has confirmed the continuation of existing retrofit schemes, something that the CIH had called for in its submission to the Autumn Budget.

 

She said: “Warm, safe homes are one of the building blocks of health and well-being, but some homes are still too difficult to keep warm in the winter.

 

“The funding will enable social housing providers to continue their work tackling fuel poverty, and some small tweaks made to the schemes, especially to the grant funding profile in the social housing fund, will help to accelerate delivery in the coming years.”

 

Ms Williamson added that the CIH has also long called for the introduction of minimum energy efficiency standards in the rented sectors, especially in the private rented sector, “where residents are too often exposed to unaffordable energy bills”.

 

“We look forward to responding to the consultation, and working with our members to ensure the proposals provide a strong regulatory framework for eliminating fuel poverty,” she said.