Skills Challenge Fund for Heavy Duty Vehicle Decarbonisation 2026/27

Decarbonising heavy-duty vehicles (HDVs) involves transitioning from diesel powered trucks, buses and coaches to zero emission alternatives, including battery electric and hydrogen vehicles. Developing the skills to build, operate, repair and maintain zero emission HDVs (ZE HDVs) and their charging infrastructure is key to enabling Scotland’s HDV sector to take advantage of the technological, economic and environmental opportunities afforded by the transition.

This period of change also offers an opportunity to address long-standing workforce challenges as we meet the skills needs for the sector, including making the sector more attractive to new entrants, increasing retention,improving diversity and supporting progression.

As part of the Scottish Government's commitment to supporting a just transition to net zero transport, Transport Scotland set up the ZE HDV Skills Challenge Fund as a one year fund in 2025/26. The fund enabled participants to test, develop and collaborate on approaches that supported workforce readiness for zero-emission HDVs.

Building on the learning from the projects delivered in 25/26, we are asking for application for projects to be completed in the 2026-27 financial year. Projects that focus on raising awareness, developing skills, and improving access to training and employment opportunities across the sector are encouraged. Projects should also generate learning and set out how that learning will be shared.

In the 2025-26 iteration of the fund, eight projects were successfully delivered by a range of organisations such as local authorities, colleges, regional transport partnerships, third sector, research partners and private companies.

The funded projects generated outputs across awareness raising, workforce training, research and guidance. More than 2,000 individuals were engaged through project activity, including students, local communities and industry stakeholders. The Fund directly supported technical training for 104 individuals, including IMI-accredited ZE HDV training for technicians, apprentices and students, and train-the-trainer provision for college lecturers across Scotland. Research-led projects also generated insights into barriers affecting diversity, inclusion, recruitment and retention in the HDV workforce.

These projects provided valuable learning for future policy and funding design. They highlighted the importance of clearer career pathways, stronger business awareness, accessible and place-based training provision, and practical approaches to supporting underrepresented groups. These findings have informed the 2026-27 fund objectives and the continued focus on shared learning across the sector.

Transport Scotland is inviting applications for the 2026-27 round of ZE HDV Skills Challenge Fund. The fund will support organisations to deliver practical projects that build workforce readiness for the transition to ZE HDVs, drawing on the learning and outcomes from previously funded projects.

For 2026-27, the total available funding for all projects is £900,000. The fund is open to private, public and third sector organisations. Awards for individual projects are not expected to exceed £100,000, and all funded activity must be complete by 31 March 2027.

Projects must address at least one of the following objectives:

• Increasing awareness of the ZE HDV sector, including careers, roles and economic opportunities: addressing the need for clearer, more accessible information on the opportunities, skills needs, roles and career pathways linked to the transition to ZE HDVs.

• Supporting people and organisations to develop skills for the ZE HDV transition: building knowledge, confidence, capability and practical skills among individuals, employers, training providers, regions and regional partners.

• Improving access to opportunities within the ZE HDV sector by reducing barriers to participation in training and employment: addressing barriers that may prevent people, employers or communities from accessing training, employment and progression opportunities, including through partnership working, inclusive approaches and new models of workforce development.

Projects may contribute to more than one objective where appropriate.

Applications will be assessed on the strength and quality of their contribution to the selected objective(s), rather than the number of objectives chosen.

Applications will be assessed against three key areas: Impact, Deliverability, and Project Approach. Applicants should ensure their proposals clearly demonstrate how their prjects address the selected fund objective(s), can be delivered successfully, and contribute to the wider ambitions of the fund.

Impact

This assessment area considers the extent to which the project is expected to deliver meaningful and measurable outcomes against one or more fund objectives.

Assessors will consider:

• The relevance of the proposed activities to the selected fund objective(s).
• The significance and value of the anticipated outcomes.
• The extent to which the anticipated impact is clearly evidenced and measurable.
• The extent to which meaningful collaboration with industry partners supports project delivery and outcomes.

Projects that demonstrate a strong understanding of the challenge being addressed, provide clear evidence of need, and articulate measurable outcomes are likely to score more favourably.

Deliverability

This assessment area considers the feasibility of the proposed project and the applicant's ability to successfully deliver the planned activities.

Assessors will consider:

• Organisational capability, experience and staffing arrangements.
• Whether the proposed budget and funding arrangements are realistic and sufficient.
• The credibility of the proposed timeline and delivery milestones.
• The identification and management of project risks.

Projects that provide assessors with confidence in their ability to deliver the proposed activities, within proposed budget and timeframe, are likely to score more favourably.

Project Approach

This assessment area considers how the project will be delivered and the extent to which the proposed approach aligns with the wider ambitions of the fund.

Assessors will consider:

• The extent to which the project adopts a proactive approach to widening participation and engaging individuals or groups who may not typically participate through standard recruitment, training or engagement channels.
• The extent to which the project demonstrates a new, improved or under-utilised approach to addressing workforce challenges and provides opportunities to generate and share learning with the wider sector.

Projects that demonstrate meaningful collaboration, inclusive delivery approaches, and a commitment to sharing learning and good practice are likely to score more favourably.

How to apply

Applicants must complete the application form and financial information spreadsheet attached and the other documents listed below as relevant. Applications must be submitted using the templates provided by Transport Scotland and in accordance with the application guidance. The deadline for applications is 12pm on 18 August 2026. Applications received after this deadline may not be considered.

Required documents

Applicants must submit the following documents:

1. Completed application form
2. Completed financial information spreadsheet
3. Project plan
4. Risk register
5. Project governance structure or organisation chart
6. Partnership letters, where applicable
7. Match funding evidence, where applicable

Incomplete applications may not be assessed.

Completed applications, including all required supporting documentation, should be emailed to:

• jaroslav.sabukevic@transport.gov.scot
• sean.duff@transport.gov.scot
• charlotte.taylor@transport.gov.scot

The email subject line must be:

Assessment and funding decisions

Transport Scotland aims to notify applicants of funding decisions and issue grant offer letters to successful applicants in September 2026.

Applicants should not incur project costs until they have received and accepted a formal grant offer letter, unless otherwise agreed in writing by Transport Scotland.

Pre-application discussions and enquiries

Prospective applicants are encouraged to contact the fund team before applying to discuss project ideas, eligibility and application requirements.

For questions about the fund or the application process, contact:

• jaroslav.sabukevic@transport.gov.scot
• sean.duff@transport.gov.scot
• charlotte.taylor@transport.gov.scot

Fund Timeline

Information Sessions

We will be holding information sessions for prospective applicants on Tuesday 28 July and Tuesday 4 August at 1pm, to provide an overview of the fund and the application process. The sessions will cover the fund objectives, examples of previously funded projects, guidance on completing the application form, and tips on information required to support the assessment of proposals.

Each session will last approximately one hour. To request an invitation, please contact jeryll.fong@transport.gov.scot with the email addresses of those wishing to attend.

Funding

The total pot available is £900,000, with individual projects eligible for up to £100,000 each. There is no minimum amount that a project can apply for.

There is no expectation from Transport Scotland on how much funding a project should request. Each individual project is different, and the funding they request should match both the project’s ambition and ability to deliver.

If an applicant has decided to apply with an element of match funding, they must ensure the details at section 7.2 of the application form are complete and correct.

Within section 1 of the application form, the self-assessment checklist, the final check box requests that applicants submit evidence of their match funding.

This evidence can be the grant offer letter, or another letter which is signed and dated by the funding provider with their name and address as well as the exact reason for the funding, e.g. employing a member of staff.

Grant payments are given in both December and March. The structure of the payments can be discussed with Transport Scotland.

There is no stated requirement for applicants to provide match funding or make a minimum financial contribution to the project.

The application form asks applicants to state:

• the total eligible project costs;
• the amount of Transport Scotland grant requested;
• the percentage of eligible project costs requested from Transport Scotland; and
• any applicant or external match funding, where applicable.

The match-funding section is intended to capture any additional funding that forms part of the proposed project financing.

The section does not establish a requirement for an applicant contribution. Where no match funding is being provided, the applicant should record this clearly and ensure that the total eligible project costs and grant requested are consistent.

The lead applicant should be the legal entity that will enter into the grant agreement, receive and account for the funding, employ or contract the relevant resources, and exercise control over the project’s income and expenditure.

Where a hosted programme does not have a separate legal entity, bank account, independently approved annual accounts, or authority to enter into agreements in its own name, the host university would need to act as the lead applicant.

The hosted programme may be identified within the application as the programme or delivery unit responsible for the proposed activity. On that basis, the financial and due-diligence information should relate to the university as the proposed grant recipient.

The application should also explain clearly:

• the relationship between the university and the hosted programme;
• which body will receive and account for the grant;
• who has authority to sign the grant agreement;
• how financial control and project governance will operate;
• the programme’s role in delivering the project; and
• the university’s responsibility for oversight, reporting and compliance.

The application form’s eligibility checklist requires the applicant organisation to have a UK bank account, annual accounts approved by its management committee or board, and control over all income and expenditure. It also requires an authorised representative of the lead applicant to sign the declaration and enter into the grant agreement.

Scottish Government due-diligence guidance requires checks on the proposed recipient’s legal status, financial stability and annual accounts, governance arrangements, audit reporting, previous grant performance where relevant, and project plan. Therefore, the accounts submitted should be those of the legal entity that would receive and be accountable for the award.

Transport Scotland may request further information to establish the appropriate lead applicant and governance arrangement before making an award. The application form expressly reserves the right to seek clarification or additional information from applicants and partners.

The fund documentation does not require individuals to participate on a voluntary basis. A reasonable payment for an individual’s time may be included as a proposed project cost where the payment is lawful, necessary to deliver the project, proportionate, and directly attributable to the approved project activities and outcomes.

The proposed arrangement must accurately reflect the individual’s role in practice. An applicant should not describe a person as a volunteer where the practical arrangements create an employment.

Transport Scotland cannot determine an individual’s employment status on behalf of the applicant. The applicant is responsible for obtaining appropriate legal, payroll or HR advice and for complying with employment, tax, safeguarding and other applicable requirements.

Yes, project delivery and the submission of all associated financial claims are expected to be completed by the end of the 2026/27 financial year, which is 31 March 2027.

Eligibility

Yes, staff costs may be eligible where they are directly related to delivery of the proposed project and are necessary, reasonable and proportionate to achieving the agreed project outputs and outcomes. This applies to eligible public, private and third sector applicants, including NGOs and public organisations. The fund information presented to applicants confirms that the fund is open to public, private and third sector organisations.

Eligible costs must, however, be clearly defined and broken down. The relevant staff roles, time allocated to the project, calculation method and relationship to the funded activities should therefore be set out in the application and Financial Information Spreadsheet.

Applications supporting skills development across any career, profession, or discipline associated with the Zero Emission Heavy Duty Vehicle (ZE HDV) sector are welcome. The fund is not limited to technicians and encourages projects that address skills needs across the wider industry.

Yes. Projects may be delivered in partnership by multiple organisations. However, there must be a designated lead applicant who will take overall responsibility for project delivery and act as the primary point of contact with Transport Scotland.

Yes. Organisations may submit proposals for multiple projects, and each project will be assessed on its own merits. Please note that each organisation is subject to the relevant subsidy control limits, including any government funding received through schemes other than the Skills Challenge Fund.

There are no specific areas of society that are expected to be targeted in the projects. Objective number three focuses on reducing barriers to the sector. This may encourage exploration of communities that are under-represented, however it is expected that projects determine their own audiences.

No. There is no minimum number of participants required for a project to be eligible to apply. However, applicants must clearly state the intended impact of their project, including an estimate of how many target individuals are expected to benefit from it.

There is no expectation or need for projects to continue beyond the funding end date. Transport Scotland hopes that projects have a lasting impact, which can be achieved in different ways, for example employees taking the next step in their career following training being delivered.

Examples

No. We do not publish full details of projects from previous funding rounds. We have brief summaries of some projects which we previously supported available by request.

Collaboration

One of our partners, Energy Skills Partnership, offered to provide projects with connections to colleges. If this is something you would be interested in, please contact Rachel.