The Department for Education (DfE) has recently encouraged academy trusts and schools to reconsider how they procure energy, as ongoing market volatility continues to affect costs across the education sector.

In its March 2026 update for academies, the DfE highlighted concerns around the limited availability of competitive fixed-price energy contracts and recommended that schools explore longer-term variable-rate purchasing arrangements instead – particularly through the DfE’s Energy for Schools scheme.

For academy trusts with energy contracts due to expire within the next 12 months, now is an important time to review available options and consider future procurement strategies carefully.

What is the V30 energy contract?

Schools and academy trusts joining the DfE’s Energy for Schools initiative are placed into the V30 energy purchasing framework, managed through the Crown Commercial Service (CCS).

The framework operates by purchasing energy gradually over a period of up to 30 months ahead of delivery. This approach is designed to reduce exposure to sudden market fluctuations and help smooth pricing over time.

Participating schools continue to manage their own energy consumption and billing arrangements directly, while benefiting from the wider purchasing power of a national public-sector procurement basket.

Additional academy sites can also be added to the arrangement during the contract period where required.

According to pilot data published by the DfE, some schools may achieve significant savings compared with traditional procurement methods, although savings will vary depending on market conditions and existing contract arrangements.

Potential benefits for academy trusts

The DfE highlights several potential advantages associated with the V30 framework, including:

  • greater protection against short-term energy market volatility
  • reduced reliance on unregulated energy brokers
  • less administrative burden around procurement
  • compliance with public-sector procurement requirements
  • improved budget forecasting and financial planning stability

For many trusts, the predictability offered by a longer-term purchasing model may support more effective medium-term financial planning.

Important contractual considerations

While the V30 arrangement may offer advantages, academy trusts should also carefully consider the contractual commitment involved.

One of the most significant features of the framework is the requirement to provide 30 months’ notice to exit the contract. This makes it a long-term strategic decision rather than a short-term procurement exercise.

Trustees and finance leaders should therefore review their operational needs, growth plans and longer-term energy strategies before entering into the arrangement.

Who can apply?

The Energy for Schools scheme is available to all state-funded schools and academy trusts in England.

Application routes differ depending on organisational structure:

  • single academy trusts (SATs) and individual schools can apply online directly
  • multi-academy trusts (MATs) are required to register interest separately and complete the onboarding process with support from the DfE team

Additional schools within a MAT can be incorporated into the framework as needed throughout the contract term.

Key deadline for the next V30 basket

Academy trusts wishing to join the next V30 purchasing basket, due to commence on 1 April 2027, must submit applications by midday on Tuesday 15 September 2026.

Depending on existing contract end dates, some trusts may initially move onto interim arrangements before transitioning fully into the V30 framework.

Key points to review before renewing energy contracts

The DfE has also issued wider guidance to help academy trusts approach energy procurement more effectively.

Important considerations include:

Start planning early

Energy contract changes can take several weeks to complete, with switching processes often taking up to two months. Some procurement options are only available within certain timescales before renewal dates, making early planning essential.

Avoid contracts lapsing

Allowing an energy contract to expire without replacement arrangements can result in schools being moved onto expensive “deemed rates,” which are typically significantly higher than negotiated contract prices.

Compare quotations carefully

Trusts should ensure all quotations are assessed consistently, including:

  • unit rates
  • standing charges
  • VAT
  • Climate Change Levy charges
  • kVA charges
  • broker fees and commission

Exercise caution when using brokers

Where brokers are involved, trusts should request full written disclosure of all fees, rebates and commissions. Letters of authority should be limited appropriately and should not authorise brokers to enter contracts on behalf of the trust.

Ensure procurement compliance

All energy procurement activity must comply with public-sector procurement rules as well as the trust’s own internal approval processes. Using approved frameworks can help demonstrate compliance more clearly.

Supporting sustainability and climate planning

Energy procurement decisions may also form part of wider sustainability objectives and Climate Action Plans.

While renewable energy contracts do not always represent the lowest-cost option, stable pricing arrangements can help trusts budget more effectively for future carbon reduction initiatives and energy efficiency improvements.

Energy procurement is now a strategic issue

The latest DfE guidance reflects a wider shift in how academy trusts are expected to approach energy procurement.

With continued uncertainty in energy markets, trusts can no longer afford to treat renewals as a routine administrative exercise. Careful planning, procurement compliance and long-term financial consideration are becoming increasingly important.

For trusts approaching contract renewal, reviewing whether the V30 framework – or a similar risk-managed solution – is suitable should form part of broader strategic financial planning.

This article was originally published to https://www.uhy-uk.com/insights/dfes-v30-energy-contract-guide-academy-trusts and is shared with kind permission.