Green Finance Fund: applicant information

Renewable energy projects seek to decarbonise energy and increase the flexibility of the energy system. This includes:

• Renewable sources – operating at lifecycle emissions of less than 100gCO₂e/kWh.
• Secondary or waste heat sources – the delivered emissions intensity of a heat network should be less than 83gCO2e/kWh. Support may be provided to a heat network exceeding this amount only if (i) the emissions intensity of the heat source is below 83gCO2e/kWh; and (ii) a decarbonisation strategy that puts the heat network on a pathway to net zero and achieving the 83gCO2e/kWh threshold by 2050 is provided.

This category includes schemes that contribute to the decarbonisation and flexibility of the energy system.

Investments will also be available for the use of secondary or waste heat sources, often along with heat pumps, in district heat networks, system level storage and demand management or flexibility services.

Core indicators

• Annual greenhouse gas emissions (GHG) reduced and/or avoided in tonnes of CO₂ equivalent.
• Installed renewable energy capacity (MW).
• Annual renewable energy generation in MWh/GWh (electricity) and GJ/TJ (other energy saving).

Other indicators

• Number of heat network supported.
• Installed storage capacity in kW/MW.

Energy efficiency projects seek to improve energy efficiency and EPC ratings in existing buildings with the aim of helping London’s buildings get to an average EPC B rating.

Projects are expected to deliver at least one of the following:

• improve by a minimum of one and preferably by two EPC bands
• uplift the energy efficiency score (or reduce consumption) of a building by at least 30 per cent
• get to a ‘good practice' Energy Utilisation Index (measured in kWh/m2) for the building according to its typology.

This also includes investments that:

• enable monitoring and optimisation of the amount and timing of energy consumption such as smart meters, load control systems, sensors or building information systems
• reduce losses in the delivery of bulk energy services or enhance integration of intermittent renewables such as energy storage, smart grids, demand response
• upgrade street lighting to LED lighting.

Core indicators

• Annual (GHG) emissions reduced/avoided in tonnes of CO2 equivalent.
• Annual energy savings in MWh/GWh (electricity) and GJ/TJ (other energy savings).

Other indicators

• Percentage reduction in building/portfolio energy demand compared to pre-intervention baseline.
• Pre- and post- intervention Energy Utilisation Index for building/portfolio in kWh/m2.

Clean transportation projects are expected to deliver improved air quality and a reduction in tonnes of CO2 equivalent through either:

• operations that reduce emissions (both GHG and pollutants) of vehicles or the transport system  – for example ultra-low emission zones
• zero direct emission vehicles (including public transport and electric vehicles) and associated infrastructure (example electric vehicle charging points)
• infrastructure to support expansion of active travel modes and options, specifically walking and cycling infrastructure.

Core indicators

• Annual (GHG) emissions reduced/avoided in tonnes of CO2 equivalent.
• Reduction of air pollutants such as particulate matter (PM), sulphur oxides (SOx), nitrogen oxides (NOx), carbon monoxide (CO), and non-methane volatile organic compounds (NMVOCs).

Other indicators

• Number of charging points installed.
• Number and size of upgrades to the electricity network to support charging infrastructure.
• Kilometres of paths for walking.
• Kilometres of paths for cycling.

The Fund can lend at below the Public Works Loan Board (PWLB) prevailing rate. The rate offered will be project specific and decided by the Green Finance Fund's Credit Committee. Where organisations can access PWLB, the GFF offers loans with flexible terms at interest rates of at least 40 basis points below PWLB prevailing certainty rates.

The factors considered when assessing whether a lower interest rate can be offered to a project include:

• annual cost savings, and/or other revenues generated because of the decarbonisation measures, that are less than the annual interest or principal repayments to the fund
• investment costs per tonne of CO2 saved below £3,500
• Additionality; meaning evidence that the project would not go ahead, would be delayed or would achieve a lower impact without subsidy.

The GFF offers flexible loan terms, up to 25 years. The Credit Committee will ultimately issue the offer to the project for loan terms. The project team will work with you to understand your organisations needs.

We can consider applications that aggregate several smaller project into one loan, provided each project meets the eligibility criteria.

This lending 'facility' will let you to draw down finance for project implementation as and when needed. This provides a more flexible arrangement than other lenders might consider.  

The information needed will likely be project specific, so please complete an EOI or contact us on [email protected] to discuss this option.

No matched funding is required to access the fund. The GFF can fund up to 100 per cent of the costs, depending on the project and borrower.

We are happy to lend alongside other funders and financers in either the public or private sector.

Round five expressions of interest period closes on September 4 2025. We might open further rounds, subject to the availability of funds.

We've designed the application process to minimise the time spent on applying for applicants.

Applications are in two stages, starting with an expression of interest (EOI), which should take no more than one hour to complete.

We'll assess the EOI to ensure your project meets our minimum criteria. After this, we’ll arrange a discussion with you to learn more about the project and your financing needs.

If your project is finance-ready, you'll be invited to complete a full application.

If your project is not yet finance-ready we’ll direct you to our project development support funds and keep in touch for when you are ready for finance.

This will vary depending on your project. A more advanced project with pressures to access funds quickly will be able to accelerate the process, whereas others will be able to take longer with the application process, allowing for internal governance etc.

For further detail, please take a look at the application timeline on our Green Finance Fund page.

In the first instance, projects that are invited to submit a full application will have met the gateway criteria.

We'll assess full applications based on their fit with the Mayor’s Environment Strategy and full business case, including:

• technical feasibility
• commercial viability
• capacity for delivery
• risk analysis
• project monitoring and reporting arrangements. 

If we receive a high number of good quality applications, we'll prioritise applications with the fastest delivery and largest expected carbon reduction (that is maximising reduction in tonnes per year per £m).

There is no due diligence fee. However, for complex projects where extensive, external support is required we may pass on such costs.

Procurement should be launched within 6-9 months from the financing agreement.

Construction should begin within 18-21 months and should be operational within three years.

Where projects are delivered in phases, at least the first phase should be completed within this timescale.

You can choose your own contractors and suppliers.

The GLA will make it a requirement for project sponsors to provide regular reports on eligible project implementation (including application of proceeds) and achievement of impacts.

Where applicable, for each eligible project we will track:

• a brief description of the project
• the amount allocated to the project
• the expected impact of the project
• progress on implementation
• tCO2e reduced per annum
• tCO2e reduced during project lifetime
• tCO2e avoided per annum
• tCO2e avoided during project lifetime
• as appropriate, additional indicators may be required.

Energy savings (kWh) = (Baseline energy use in kWh per annum) - (Post-installation energy use in kWh per annum)

The fund’s impact will be reported through a yearly Allocation and Green Impact Report.