The following FAQs are intended to supplement some of the details provided within the latest guidance document and to address some of the anticipated questions arising.  Further information can be obtained by emailing whf@awscic.org.uk.  Additional questions and answers may be added as new queries are raised.

FAQs

Your Questions Answered

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Who can apply? Are joint bids acceptable?

Local Authorities (LAs) and Registered Social Landlords (RSLs) are able to directly apply to the WHF. Other commercial organisations such as community groups, charities and private landlords are expected to be part of a bid from a LA or RSL. Joint bids from LAs and RSLs, supported by their partners, are encouraged where there is a clear benefit from doing so e.g. to share a project management team, to benefit from economies of scale in procurement or to encourage wider learning. One party will need to be designated as the lead and will be responsible for completing the application form and underwriting any financial obligations. The funding from the WHF will be paid directly to the organisation named on the Recipient Agreement.

If an organisation was successful in an earlier round, are they precluded from bidding in later rounds?

No.

 

Is there a minimum or maximum size project you are expecting to see from an individual or joint LA bid ?

As funds are limited, we want to set a minimum bid level of £250,000 to encourage scale and therefore hopefully more competitive pricing. As we’ve stated in the guidelines we are looking for ambition and as the delivery window is short (2 years) we are looking at projects that are able to mobilise quickly.

 

You have said that you are not looking for standalone bids in lot 2. Can you clarify why this is the case?

Lot 2 is effectively a replacement for what was previously known as Category 3.  We have seen a number of successful Category 3 projects but we believe the greatest impact on fuel poverty is delivered by a combination of both physical measures and energy efficiency/income maximisation advice.  Our aspiration is that every household receiving a new heating system is afforded the opportunity to receives this advice.

Your guidance refers to a pot of money available for energy efficiency measures. Can you expand on how this can be accessed?

The primary purpose of lot 1 is to provide funding for first time central heating measures.  Our expectation is that other industry schemes will be accessed to ensure that insulation measures can be funded and installed prior to the heating. Should there be a shortfall in funding for insulation measures, successful recipients can apply for ‘gap funding’ by contacting the WHF team and providing appropriate documentary evidence of the shortfall and costs actually incurred. The finances within the lot 1 bid document should only relate to the costs of installing first time central heating.

Can existing staff and infrastructure costs (e.g. call centre costs) be included within matched funding as ‘contributions in kind’?

In submitting your application, it is important that you capture all costs and sources of funding within Section D of the application form.  The element of the staff and infrastructure costs that relate to your bid must be included within the total project costs.  The funding of these costs could then be included within bidders own funds (if it relates to direct costs incurred by the bidder) or in ‘other funds’ as staff resources in kind (if it relates to costs payable to a 3rd party).  In all cases costs should be identifiable and capable of being evidenced.

Are we able to submit appendices in support of our application?

Appendices can be used if necessary to provide additional detail, but you should ensure that any key points are included within the standard application form template. In the guidance at paragraph 1.5.1 (page 6) we have also requested that, where 3rd party funding has been identified, evidence is provided that it is in place e.g. letter of support from funding partner. The application form has a section that will allow attachments to be referenced and embedded within the document.

Can you provide more clarity regarding your expectations of VAT rates and what you will and will not fund

VAT legislation is complex and the application of the standard or the reduced rate of VAT to the supply of both materials and cost of services in relation to the installation of materials for a central heating system and/or other energy saving measures, varies depending on what is being supplied, to whom it is being supplied, where it is being supplied and under what circumstances e.g. grant funded.

Furthermore, whether any VAT incurred by an organisation (Local Authority (LA) or Registered Social Landlord (RSL)) in relation to the installation costs for a central heating system installation or energy saving measures can be recovered will depend on the VAT status of any particular organisation.

The VAT rates to be applied to goods and services to be provided as part of home energy projects are determined by HMRC. Whether VAT incurred by an organisation in such a project can be recovered from HMRC, would again be determined by HMRC.

AWS and the WHF team cannot (and do not hold themselves out to be able to), provide any guidance to bidders on either the VAT rates that would be applicable to goods and services to be provided as part of a home energy project; or the recoverability (from HMRC) of any such VAT cost incurred. In all instances, any queries by bidders should be addressed to their local HMRC VAT officers. The VAT helpline number is 0300 200 3700.

As set out in our guidance document all costs included in the funding application should be stated net of VAT. Where VAT is irrecoverable from HMRC and the bidder wishes to recover the cost from WHF funds, this amount should be captured separately within the application. In relation to funds requested from WHF, at our sole discretion, we will decide whether the bidder is entitled to recover such costs through the Fund. These circumstances will be limited to successful Local Authority bidders who are funding the installation of central heating and other qualifying measures to private homes.

Where funding is requested by a Local Authority to meet costs associated with the installation of measures in private households we require the irrecoverable VAT to be disclosed separately.

Is VAT to be applied to Quarterly Funding Instalment Payment Requests?

In the event that a bidder is successful and enters into a Recipient Agreement with AWS, the agreement makes it clear that there is no VAT chargeable on the amount of any Funding Instalment.

In the application you ask for a breakdown of Finders Fees – what do you mean by that?

This relates to how you intend to target the fuel poor households requiring first time central heating and, in particular, where specific agencies or contract partners provide leads.  It may be that this has previously formed part of the project management or marketing budget but it is now a requirement that they are identified separately.

Are there any restrictions on the tenure of homes which can be included?

The critical requirement is that households are in or at risk of fuel poverty.  We are particularly interested in proposals which target homes in the private sector (including private rented) and will restrict the funds for social housing to 25% of funds awarded during this round of bidding.

You have included a cap of 30% on the volume of ‘D’ rated properties that are eligible within a programme. While this is consistent with HUGs, it is lower than the allowed numbers in ECO4. Why is this?

Our aspiration remains that the worst-rated properties are targeted and treated first.  On further reflection, we recognise that WHF funds are most likely to be combined with ECO funds to deliver improvements to both insulation measures and heating systems.  On that basis we are prepared to allow a maximum of 60% of the Funding Amount awarded by WHF to be directed at Band D properties in the private sector only.  In the social sector, the cap of 30% will remain around Band D properties.

Would a property with a coal fired back boiler central heating system qualify under the scheme?

Yes. We are seeking to remove as many fossil fuel heating systems as possible.

Do we need to validate the eligibility of all households to receive central heating measures or would it be satisfactory to confirm eligibility for the majority of households within a scheme?

In order to receive central heating measures the eligibility of each individual household would need to be confirmed against the WHF criteria.

Your eligibility criteria no longer includes households in top 25% IMD areas. Why is this?

For ease of administration we have tried to align our qualifying criteria to other industry schemes.

Are we able to install new heating systems in replacement of old warm air systems?

Individual homes will be considered on a case by case basis. Communal systems powered by a gas heat source would not be eligible.

Can households with partial heating systems (where only some of the rooms are on the wet heating system) be included in the bid?

No, the programme covers first time central heating systems only.

Will WHF fund hybrid solutions that combine (e.g.) ASHP with gas boilers?

No, this is a first-time central heating programme so homes with existing gas boilers are not eligible to have an ASHP installed.  Installing a hybrid solution (two or more technologies) in homes without a wet heating system does not seem appropriate and limits the scope and breadth of the WHF programme.

Your guidance states that “all properties are expected to be insulated in line with the pre-install EPC”. In some cases, particularly where homes are of solid wall construction, some insulation measures may not be viable. What are your expectations?

The primary purpose of lot 1 is to provide funding for first time central heating measures and therefore the finances within the lot 1 bid document should only relate to the costs of installing first time central heating.  Our expectation is that other industry schemes will be accessed to ensure that insulation measures can be funded and installed prior to the heating.  Where measures may not be considered economically viable e.g. industry standards might suggest something like external wall insulation, but it may not be feasible from a cost perspective, this should be documented in your proposal (if specific properties or archetypes are known at that stage) and referenced in any future Funding Use Report.  Successful recipients can apply for ‘gap funding’ by contacting the WHF team and providing appropriate documentary evidence of the shortfall. For the avoidance of doubt the WHF team are under no obligation to provide such funding.

Are there any penalties for under delivery against the forecast number of installations in the bids?

We would ask organisations to be realistic in their ambitions to reflect what can be delivered.  The WHF is a finite ‘pot’ of money and therefore we’d expect fairness in the award process.    Recipients are contractually obliged to provide ‘own use funding’ in accordance with their Agreement.

Can the payment terms be negotiated as payment quarterly in arrears presents some challenges for us?

No – bidders should factor this into their cashflow requirements.

How long do we need to keep information relating to the households and properties who receive assistance under the scheme?

We may exercise our rights to audit at any point during your project so information should be retained at least until the project closure report has been approved by ourselves and outstanding liabilities settled. Beyond that you should ensure that all information relating to the project is held for a period consistent with your organisation’s data retention requirements.

In earlier rounds the retention payment was 5% to a maximum of £50,000. Why has it now increased?

This is a reflection of the scale that we are looking for in the bids and a 10% retention is more appropriate to that scale.

We are not able to work with the Recipient Agreement, how do we negotiate changes?

The Recipient Agreement represents the terms and conditions for managing awards under the WHF and we will not enter into negotiations regarding those terms.

We are unable to obtain outstanding post install EPCs due to the Covid-19 crisis. What is your guidance around this?

The decision tree below combines both our existing guidelines and some additional flexibility arising from Covid-19 to set out how we will deal with missing EPCs.  The guidance seeks to distinguish between process issues which are the Recipient’s responsibility to address and specific Covid-19 related delays.

 

What happens if a scheme includes a mix of measures? How is the average cost/measure for payments derived? What would happen if a bidder installs the expensive solutions in the mix first?

All funding payments will be made at the same average cost/measure over the entirety of the planned scheme for ease of administration. This needs to be considered by bidders in the plans submitted for the schemes. The type of measures that you actually deliver will need to be consistent with your application and planned installations. Variances from your application may require additional ‘Own Use Funding’

What happens if our costs are less than planned and the amount of WHF funding reimbursed on the cost per measure basis exceeds the amount required to fully fund the project?

In accordance with the contract terms your own funds should be used in the first instance with WHF monies used as a ‘top up’ to enable you to complete the installations. If you have delivered your project and there are surplus funds available, our preference is that you deliver an agreed number of additional central heating systems to utilise those funds. If properties cannot be identified into which additional first time central heating systems can be installed, WHF will seek reimbursement of the surplus from the Recipient.

You require EPC certificates both pre and post measures. What if an EPC rating is already in place for the property?

You will need a pre and post measures assessment and one of those can be a desktop calculated report. We expect the initial EPC to reflect what is in the house immediately prior to installation and if an EPC has been lodged within the last five years and nothing has changed, this can be used.