What Is the Social Housing Decarbonisation Fund?

The Social Housing Decarbonisation Fund will upgrade the energy efficiency of thousands of UK homes.

Published 30 March 2023

Author EVO


  • The Social Housing Decarbonisation Fund (SHDF) aims to upgrade the energy performance of social homes across the country.

  • Social housing operators could bid for a share of £3.8bn in funding to install energy performance measures. 

  • The deadline for submissions was 18 November 2022.

  • Social housing providers can still apply for Phase 2 of the Home Upgrade Grant via their local authority. 



Improving the energy efficiency of the UK’s social housing stock is a hot topic at the moment.

Not only will it help the government hit its carbon neutral targets, but it will also help lessen the impact of rising fuel costs on some of the country’s most vulnerable people. 

But according to research by Inside Housing, the total cost of decarbonising Britain’s social housing will be £104bn.

The government has taken steps towards tackling this by announcing the Social Housing Decarbonisation Fund. 

The scheme aims to upgrade the energy performance of social homes across the country.

Social housing operators could bid for a share of £3.8bn in funding to install energy performance measures. 

The money can only be used to upgrade homes with an Energy Performance Certificate (EPC) rating of D or below. 

Unfortunately, if you wanted to secure funding through the Social Housing Decarbonisation Fund but haven’t applied, you are too late. The deadline for submissions was 18 November 2022.

The funding is being issued in two waves: 

  • Wave 1 has already been awarded. 69 projects are receiving £179m in funding, which will help improve the energy performance of 20,000 social houses. 

  • Wave 2 projects will be announced in March 2023. £800 million in funding will be awarded in this second wave.

What other schemes are available?

The government hasn’t recently announced any new green building projects for social housing. 

The  Phase 2 of the Home Upgrade Grant application deadline was 27 January 2023.

This grant scheme aims to upgrade poorly insulated off-gas grid homes or low-income households. 

Local authorities will be allocated an average of £18,000 per property.

However, there are a few downsides that make this scheme less attractive than the Social Housing Decarbonisation Fund:

  • Your local authority has to apply for this scheme on your behalf

  • Social housing can only be used as part of a scheme that mainly targets owner-occupier and privately rented properties.

  • The social housing component should only make up a maximum of 10% of the scheme.

What does the Social Housing Decarbonisation Fund aim to achieve? 

The aim of the scheme is to bring as many social housing properties as possible up to an EPC rating of C. 

Today, almost 40% of social housing homes are below this. 

As well as upgrading the energy efficiency of the UK’s social housing stock, the SHDF also aims to:

  • Lower carbon emissions

  • Reduce fuel poverty

  • Create green jobs

  • Nurture the retrofit industry

  • Improve the lives of social housing tenants

Who was allowed to apply?

Most social housing associations were able to apply, including:

  • Local authorities

  • Registered social housing associations

  • Charities that provide social housing

Bids need to be submitted by a consortium led by a local authority, and all projects must be carried out in England. 

What improvements will the funding be spent on?

The scheme will prioritise improving the fabric buildings over installing new systems. The building needs to be able to reach an EPC rating of C via these improvements. 

The improvements should also give properties a space heating demand of 90 kwh/m2/year.

These rules ensure that properties are suitable for low carbon heating systems in the future.

Social housing owners are allowed to install low carbon heating, but only if a fabric first approach is taken.

Any new heating system that is installed must lower bills compared to the existing system.

The full list of improvements covered by the scheme includes:

  • Cavity wall insulation

  • Internal and external solid wall insulation 

  • Loft insulation

  • New windows and doors

  • Heating systems and controls

  • Water efficiency systems

  • Renewable energy systems like solar panels and heat pumps

How much is spent on each property?

Funding is provided based on the current EPC rating of the property. The lower the rating, the more funding is provided. 

Landlords will need to match at least 50% of the government funding put towards improvements. 

So a property rated G could get a maximum of £16,000 from the Social Housing Decarbonisation Fund. The landlord would then put in £8,000. The total funding available for improvements would therefore be £24,000.

The per-property grant funding can be used flexibly across different homes. So if one property requires more work than the other, the funding can be focused on the house with the greatest need. 

Any administrative and ancillary costs should make up less than 15% of total costs. These are in addition to the costs for home upgrades. Providers must contribute at least one-third of these costs.

What standards must installers meet?

Any suppliers providing upgrades or improvements must be TrustMark registered and compliant.

They should also be fully certificated for the work they are carrying out and certified to MCS standards.

The work carried out must be compliant with the latest PAS 2035:2019 specification and guidance.

Manage Energy Efficiency Upgrades With EVO

The deadline for applying for the Social Housing Decarbonisation Fund may have passed, but the projects it has funded are only just starting. 

This means that social housing associations across the country will have more projects to manage across their properties than ever.

EVO can help make this easier. Our digital platform brings together landlords, tenants and tradespeople all in one place.

  • Our Landlord Dashboard allows you to see all of your properties, including details of tenants, repairs, and service history all in one place. You can quickly access a network of accredited trades to install new energy-efficiency measures in your properties.

  • Our Living App enables you and your tenants to communicate in a way that is convenient and unobtrusive. This makes it easy to arrange for them to let trades in to carry out the upgrades.  

Find out more, read how EVO helps social housing providers to manage trades, tenants and compliance. 


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