When is PSDS Phase 4 expected to open?

Based on the pattern of previous phases, a Phase 4 Expression of Interest window is anticipated in late 2025 or early 2026, with full applications likely in mid-2026. DESNZ has not confirmed an official opening date as of May 2026. Applicants are advised to prepare technical designs, EPC evidence, and carbon savings calculations in advance so they can submit quickly when the window opens — competitive phases typically close within weeks.

What does a strong PSDS Phase 4 application look like?

Strong applications score well on: (1) low £/tCO2 cost-per-tonne of abatement; (2) a multi-site portfolio that dilutes the cost of complex buildings; (3) verified baseline energy consumption data (AMR or HH metered); (4) a technically credible contractor with public sector delivery experience; (5) a phased delivery plan that demonstrates risk management. Applications citing heat pump installation with solar PV supporting grid load typically score better than solar-only projects because the combined measure achieves greater CO2 reduction per £.

What is causing PSDS applications to be rejected?

The most common rejection reasons in Phase 3 applications were: cost-per-tonne above the informal £250/tCO2 threshold; unverified baseline consumption data (relying on estimates rather than meter data); design specifications provided by a single contractor without competitive procurement evidence; and single-site applications where one difficult building dominates the cost. Public sector bodies without a Net Zero estate strategy on record also scored lower, even where the technical measures were sound.

Can solar PV alone qualify for PSDS funding?

Solar PV alone can qualify, but it is less competitive than bundled heat-and-power packages. The CO2 abatement from solar is calculated using the grid carbon intensity factor — at 0.233 kgCO2/kWh in 2026, a 100kWp system generating 90,000 kWh/year abates roughly 21 tCO2/year. At £120,000 installed cost, that is £286/tCO2 over 20 years — marginal for PSDS. Pairing solar with heat pump conversion, which removes gas consumption at much higher CO2 rates (0.183 kgCO2/kWh gas), dramatically lowers the blended cost-per-tonne.

Finance

“Commercial solar funding” in 2026 means finance, not grants: the four nations compared

Published 2026-09-26 · 6 minute read · By Commercial Solar Finance editorial team

The research question behind the search: is there any commercial solar funding left, and does it depend on where the building is? Short answer: the grants have gone, the reliefs remain, and three of them differ by nation. Checked 26 September 2026.

Type “commercial solar funding” into a search engine and most of the results still promise grants. The Public Sector Decarbonisation Scheme closed to new applications in November 2024 and DESNZ calls Phase 4 its final phase; private-sector capital grants were always regional and small. What is left is a finance decision with reliefs layered on top — the six routes on our commercial solar funding and financing page, and the layers below.

Layer one: capital allowances are UK-wide

Solar is special-rate plant everywhere in the UK (HMRC CA22335). The Annual Investment Allowance relieves the first £1m of qualifying spend in year one; the 50% first-year allowance covers special-rate spend above that for companies; the balance is written down at 6%. Nothing about this changes at a border.

Layer two: business rates differ by nation

Nation	Renewables plant in the rating valuation	Basis
England	Excluded 1 April 2022 to 31 March 2035	SI 2022/405
Scotland	Excluded 1 April 2023 to 31 March 2035 (plant only)	SSI 2023/32
Wales	Separate rules — confirm with the Valuation Office Agency	SI 2022/405 amends the England regulations only
Northern Ireland	Separate rating system	Land & Property Services

Layer three: loans for public bodies exist only in Scotland and Wales

Salix delivers grants in England (PSDS — closed to new applications in November 2024 and now in delivery only — and the Low Carbon Skills Fund) but loans in Scotland (the zero-interest Scottish Public Sector Energy Efficiency Loan Scheme and the Scotland Recycling Fund, both open) and Wales (the Wales Funding Programme, open, and the £20m Digarbon scheme for tertiary education). An English NHS trust or council funds solar from its capital programme, a lease or a power purchase agreement; a Scottish or Welsh one can borrow at 0%.

Layer four: SME loans, with a catch

Business Energy Scotland's SME Loan is interest-free, £1,000–£130,000 over eight years with cashback for efficiency measures — and its page states it is not accepting new applications for solar PV projects. The Development Bank of Wales runs a Green Business Loan Scheme whose term is linked to project payback. England's equivalents are the regional and combined-authority funds, open intermittently. None of these is a grant; each is a cheaper way to do the same finance.

Layer five: planning and the grid

Scotland removed the kilowatt cap on non-domestic rooftop permitted development in May 2024 (Class 6J); England's rules differ and conservation areas bite on road-facing elevations. Distribution network operators also change at the border and inside it — the grid supply group for a postcode decides whom you pre-apply to for G99. The regional pages carry the detail: commercial solar finance in Scotland and commercial solar finance in Wales.

Read next: the six commercial solar financing routes compared, and public sector solar funding for what replaced PSDS.

More insights

FUNDING

UK regional solar funds compared 2026

PUBLIC SECTOR

PSDS Phase 4: the three patterns in funded applications

STRUCTURES

Capex vs PPA: a decision tree for commercial solar in 2026

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