Funding School Solar in 2026: Salix, PSDS & CIF Grants
Every school leadership team now faces the same twin pressure: energy bills that jumped after 2022, and a growing expectation that the estate moves toward net zero. Rooftop solar answers both at once - but only if you can fund the upfront cost without raiding a stretched capital budget. The good news is that schools and academies have funding routes that ordinary businesses simply don't get. The confusing part is that those routes all have different names, different owners and different rules.
This guide breaks down the three you will hear most often - Salix, PSDS and CIF - and explains how solar increasingly sits alongside battery storage and heat pumps in a single, fundable decarbonisation plan.
The three funding routes schools actually use
PSDS - the Public Sector Decarbonisation Scheme
PSDS is the flagship. It is government grant money, delivered by Salix on behalf of the Department for Energy Security and Net Zero, aimed at helping public-sector buildings cut carbon. It has run in successive phases, and maintained schools, academies and colleges are all eligible applicants.
The important nuance: PSDS is a heat-decarbonisation scheme first. Its core purpose is replacing fossil-fuel heating - typically gas boilers with heat pumps - and solar PV is usually funded as an enabling measure that offsets the extra electricity a heat pump draws, rather than as a standalone project. In practice that means the strongest PSDS bids present solar, insulation and a heat pump as one connected package, with a clear carbon saving stated for every pound of grant requested.
CIF - the Condition Improvement Fund
CIF is a different animal. It is capital funding for eligible academies, sixth-form colleges and voluntary-aided schools, run by the Department for Education, and it is competitive and annual. Its primary job is keeping buildings safe, warm and watertight - so it is strongest when your solar and energy work rides alongside a genuine condition need, such as replacing a failing roof. Fitting panels at the same time as a re-roof is far cheaper than doing it twice, and assessors look favourably on projects that solve a condition problem and cut running costs together.
If you are a maintained (council-run) school rather than an academy, CIF is not open to you - but your local authority's own capital programme and School Condition Allocation may fund similar work.
Salix - the delivery body and the finance
Salix Finance is the organisation that administers PSDS, so you will deal with it directly on any public-sector grant. Historically Salix also offered interest-free loans for energy-efficiency measures to public bodies; loan availability changes between funding rounds, so it is worth checking what is currently open when you apply. Either way, Salix is the name on most of the paperwork.
| Scheme | Who it is for | What it best funds |
|---|---|---|
| PSDS | Maintained schools, academies, colleges | Heat pumps with enabling solar and insulation (heat-first) |
| CIF | Academies, sixth-form and voluntary-aided schools | Solar alongside condition work such as re-roofing |
| Salix finance | Public-sector bodies | Administers PSDS; interest-free loans in some rounds |
No capital to spare? PPAs and community energy
Not every school can wait for a grant round, or wants the procurement burden of owning a system outright. Two routes remove the upfront cost entirely:
- Power Purchase Agreements (PPAs). A third party funds, installs and owns the panels; the school simply buys the electricity generated, usually at a rate below the grid price, under a long-term agreement. There is no capital outlay - though you give up the free power a fully owned system would eventually deliver.
- Community energy. A growing number of local co-operatives raise money from residents to put solar on school roofs, sharing savings with the school and modest returns with investors. It is slower to set up, but keeps the benefit local - often a natural fit for a school's ethos and curriculum.
Why battery storage and heat pumps belong in the plan
Solar on its own has an awkward feature for schools: the best generation months are the summer holidays, when the building is nearly empty. During term time the fit is much better - weekday daytime loads from lighting, IT suites, catering and, increasingly, heating line up reasonably well with the sun.
Two additions sharpen the case considerably:
- Battery storage captures midday generation and releases it into the morning and late-afternoon peaks, and can hold some summer output back for weekday cleaning, holiday clubs and lettings. It also unlocks smart half-hourly tariffs.
- Heat pumps turn heating into an electrical load your solar can partly serve, which is exactly why PSDS wants to see them together. Swapping a gas boiler for a heat pump is where the largest carbon saving on most school estates sits.
Treating solar, battery and heat as one system - rather than three separate projects competing for attention - is what turns a nice-to-have into a genuinely fundable net-zero estate plan.
One thing not to assume: the domestic schemes don't apply
It pays to be clear about what schools cannot use, because the domestic renewable schemes are far more visible in the press. The 0% VAT rate on solar panels and heat pumps applies to homes only, not to school or commercial buildings. The £7,500 Boiler Upgrade Scheme grant for heat pumps is likewise a domestic-only scheme. For schools, the public-sector routes above are the ones that count.
That distinction matters for the families and staff around your school, too. A caretaker, teacher or parent looking at panels or a heat pump at home is firmly in the domestic world, where the £7,500 grant and 0% VAT do apply. If your school sits in the South West, it is worth pointing them toward a clear regional guide to solar panel and renewable energy grants in Cornwall, which sets out the household schemes without the jargon.
Where to start
Begin with a proper energy audit of the estate - half-hourly consumption data, roof condition and the age of the heating system - because every funding bid, PSDS or CIF, is judged on carbon saved per pound and needs that baseline to stand up. From there you can decide whether to chase a grant round, invite a PPA, or phase the work across a re-roofing programme. In the end the right route depends less on the technology and more on whether you are an academy or maintained, and on how patient your capital plan can afford to be.