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On 18 December 2023, the Government announced £6bn of future funding for energy efficiency to support families, business, and industry to cut energy use and bills.

As part of this £1.75bn of combined funding has been announced for a new local authority retrofit scheme and future waves of the Social Housing Decarbonisation Fund (SHDF), subject to business case approval and value for money assessments. This includes £1.25bn of further funding for SHDF.

Overview of SHDF Wave 3

We anticipate the application window for the next wave of SHDF to open in Summer 2024.

SHDF Wave 3 will provide grant funding for social housing landlords to improve the energy performance of their properties through the installation of energy efficiency measures and low carbon technologies.

The Wave 3 fund’s objectives are to reduce bills, improve home warmth, reduce the number of tenants in fuel poverty, and reduce carbon emissions. Furthermore, it aims to build capability in the supply chain and social housing sector, developing knowledge and capacity to deliver retrofit works in the future.


Registered providers of social housing and registered charities that provide social housing are eligible to apply for funding.

Two application routes

Two application routes will be implemented for SHDF Wave 3 – The Challenge Fund, and Strategic Partnership routes. These routes have been designed to reduce resource burden at application stage and give greater flexibility.

  • Strategic Partners - Strategic Partners will be led by organisations that can deliver retrofit on a large scale and at lower cost due to their past experience and expertise.

  • Challenge Fund - The Challenge Fund has been designed for most applicants to access whereby funding will be available in principle for bids that have met the minimum standard. There will be a multi-stage application process which enables grant recipients to develop detailed proposals once they have passed the initial stage.

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