Defra Outlines SFI26 Window 2 Plans as Window 1 Funding Nears Full Allocation
The Department for Environment, Food and Rural Affairs (Defra) has confirmed that Window 2 of SFI26 will open to all farmers in September 2026, with the application opening date to be announced after Window 1 closes.
Window 2 will have a budget of £180 million, plus any funding that remains unallocated from Window 1.
New “Start an Application Early” (SAE) functionality for eligible expiring ELM revenue agreements
In Window 2, farmers with eligible Environmental Land Management (ELM) revenue agreements ending by 28 February 2027 will be able to start an SFI26 application before their current agreement expires using the new “Start an Application Early” (SAE) functionality in the application system. This will help to ensure a smoother transition between schemes.
The 28 February 2027 cut-off date is designed to ensure there is enough time for farmers to apply for and start an SFI26 agreement before 1 April 2027, which is required for funding from the current financial year's budget.
The new feature will allow applications for SFI26 actions on land that is still covered by an existing ELM agreement. This is possible because the new SFI26 agreement will not begin until after the current agreement has ended, avoiding any overlap of actions or double funding.
Where possible, although this is not guaranteed, the Rural Payments Agency (RPA) will offer SFI26 agreements before an existing ELM agreement expires.
Farmers who receive an offer early will be able to accept it through the application system, with the new agreement usually starting on the first day of the month after their current agreement ends.
If a farmer has more than one eligible ELM agreement, the SFI26 agreement will not start until the agreement with the latest expiry date has ended.
Window 1 Uptake
The RPA has offered 1,188 SFI26 agreements to Window 1 applicants, of which 922 had been accepted by 31 July, enabling those farmers to start their agreements on 1 August.
On 13 July 2026, Defra reported that around 75% of the Window 1 budget had been allocated based on applications received.
Window 1 has a budget of £60 million and will remain open for up to two months unless funding is fully allocated sooner. It is therefore due to close no later than 11.59pm on 28 August 2026. Eligible farmers who do not apply during Window 1 will be able to apply in Window 2.
Capital Grants 2026
Defra has also confirmed that 75% of the £225 million Capital Grants 2026 budget has now been allocated to funding that helps farmers invest in projects to improve water quality, enhance biodiversity, support nature recovery and promote sustainable land management.
With a significant proportion of the funding already allocated, anyone planning to apply should submit their application as soon as possible, as the remaining budget is becoming increasingly limited.
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