Subsidy control

Introduction

Digarbon Round 2 - The decarbonisation fund for tertiary education in Wales will not grant any subsidies that are considered to be of particular interest, as defined in Section 3 of the Subsidy Control Regulations 2022.

However, we understand that some public sector bodies may have specific arrangements that require further investigation.  

This includes cases where public sector organisations,

  • operate as an enterprise
  • include buildings that are leased to private enterprises in their application 
  • include buildings that are rented by the public sector organisation from private landlords in their application or
  • include Private Finance Initiative (PFI) buildings in their application

In these cases, Salix will require further evidence to support these applications and confirm their eligibility to the scheme. 

As a public sector applicant please consider the scenarios below. 

If any apply to your application a further investigation will be required and further information will be requested prior to the award of funding:

Scenario Type of potential subsidy
1. Do you operate as an enterprise in the building(s) included in your Application? This means you are engaged in economic activity by offering goods or services on a market Yes Direct subsidy (type A)
No No subsidy
2. Do you lease any of the buildings in your application to an enterprise? Yes Potential indirect subsidy to the enterprise via lower energy bills as a result of the proposed Digarbon works in the building. (type B)
No No subsidy
3. If the answer to question 2 is yes, do the proposed Digarbon works in your application result in predicted lower energy bills? Yes Potential indirect subsidy to the enterprise via lower energy bills as a result of the proposed Digarbon works in the building (type B)
No No subsidy
4. Do you rent any of the buildings in your application from a private enterprise? Yes Potential indirect subsidy to the private landlord due to benefitting from the value of the measures installed in their building (type C)
No No subsidy
5. Do any buildings under PFI contracts in your application transfer to the public sector ownership at contract expiry? Yes No subsidy
No Potential indirect subsidy to the private landlord due to benefitting from the value of the measures installed in their building (type C)

If your answers to any of the above questions results in a potential subsidy, please see the table below for the further documents required as part of your application to demonstrate compliance with the subsidy control principles. 

Below is a table of the types of evidence that will be required for each type of subsidy.  

Templates for all forms can be found at the bottom of this page.

Type of Subsidy Requirements/ Evidence Requested
Direct Subsidy (type A) • If the subsidy is under £315,000 a minimal financial assistance declaration form from the enterprise
• If the enterprise is involved in economic activity in goods between Northern Ireland and the E.U. a Windsor framework declaration form
Indirect Subsidy (type B) Buildings leased to enterprises, who pay a portion of the energy bills • Leasehold agreement • An energy bill savings cap declaration form from the enterprise and public sector applicant.
Indirect Subsidy (type C) Buildings leased from enterprises • Leasehold agreement • If the subsidy is under £315,000 a minimal financial assistance declaration form from the private landlord • A financial recovery agreement – this is a tripartite agreement between the public sector organisation, their private sector landlord and Salix. This must be signed and satisfactorily completed before funding is awarded and a Loan Agreement issued.
This agreement is required to evidence that the relevant landlord(s) understands that funding could be recovered, should the lease terminate early due to this being considered a misuse of the indirect subsidy. Public sector organisations will need to provide the following information to complete this agreement,
Landlord name, Landlord address, Lease start date/ entered into, Persistence factor of all installed measure – this will be taken from the application form, Address of premise(s), Director & Secretary (2 directors) from each of Loan Recipient and Landlord
Indirect Subsidy – PFI Contracts • A copy of the PFI contract is required to show either the transfer clause in the contract or the remaining PFI length. This must be provided in the application portal under additional supporting evidence.

Evidence will be requested from applicants following application submission. Once Salix has confirmed the type, the required additional evidence and signed documentation will be requested prior to funding being awarded.   

If your project falls under any of the above categories and you would like more information, please contact us at [email protected]. 

We recommend that you get in contact with the relevant enterprises and landlords as soon as possible to avoid any potential delays to receiving the loan. 

Subsidy control form templates