AI for Decarbonisation Innovation Programme: Stream 3

Key Features

Stream 3 of the programme will support the development of innovative AI approaches that will address critical challenges in decarbonisation.

Programme:     DESNZ

Award:     Share of up to £350,000

Opens: 14th Aug 2023

Closes: 10th Oct 2023

! This scheme is now closed


This AI for Decarbonisation innovation programme will support the development of innovative artificial intelligence (AI) technologies for decarbonisation applications to support the transition to net zero. The programme will also promote  coordination and collaboration between AI and carbon-emitting sectors in the UK in order to maximise the economic and carbon benefits of AI solutions in solving our most critical decarbonisation challenges.


The main objective of Stream 3 of the programme is to support the development of innovative AI technologies that will address critical challenges in decarbonisation. We are now launching
Stream 3 with £2.25M in grant funding split across the following categories:

Lot 1: Using AI to accelerate decarbonisation across generation, demand, transmission, and distribution of electricity

Lot 2: Using AI to optimise energy use in decarbonised transportation

Lot 3: Using AI to optimise and identify land use for renewables generation

The funding will be allocated according to a ranked order starting with the highest total scoring project. A minimum of one project will be funded in each Lot. Further information on the
funding allocation can be found in Section 3.3 below.

Applicants can apply for up to £350,000 grant per proposal and projects must end no later than 31st March 2025. Applicants may be part of multiple bids and Lots for unique projects delivering different innovation. Only one proposal per lead company may be submitted.

During the application process, applicants will be expected to demonstrate a robust evidencebased case for funding, which will include but not be limited to:

• The potential impact of their AI approach on decarbonisation and UK’s net zero target
• The innovative level of their approach
• The potential impact on developing UK AI capability in decarbonisation and growth
• The technical credibility of their innovation including a coherent development plan that will commercially progress the innovation.
• Value for money and additionality.

The Competition is eligible for all sizes of organisation but the technologies in scope must be between TRL 3 – 7. Projects can work with international partners, but at least 70% of the project activities, by project cost must be conducted in the UK.

Applicants will be expected to demonstrate that their project proposals meet the definition of either Industrial Research, Experimental Development or a Feasibility Study.

Project Types

Applicants will be expected to demonstrate that their project proposals meet the definition of either Industrial Research, Experimental Development, or a Feasibility Study. Funding levels will vary for each project type according to conditions as set out in Section 4.

Fundamental Research Fundamental research is defined as experimental or theoretical work undertaken primarily to
acquire new knowledge of the underlying foundations of phenomena and observable facts, without any direct commercial application or use in view.

Industrial Research

Industrial research is defined as ‘the planned research or critical investigation aimed at the acquisition of new knowledge and skills for developing new products, processes or services or
for bringing about a significant improvement in existing products, processes or services.’

Activities may include:

• the creation of component parts of complex systems
• the construction of prototypes in a laboratory environment or in an environment with simulated interfaces to existing systems
• pilot lines, when necessary for the industrial research and notably for generic technology validation.

Experimental development

Experimental development is defined as: ‘acquiring, combining, shaping, and using existing scientific, technological, business, and other relevant knowledge and skills with the aim of
developing new or improved products, processes, or services. This may also include, for example, activities aiming at the conceptual definition, planning and documentation of new
products, processes or services’.

Activities undertaken may include prototyping, demonstrating, piloting, testing and validation of new or improved products, processes, or services in environments representative of real-life
operating conditions where the primary objective is to make further technical improvements on products, processes or services that are not substantially set. This may include the
development of a commercially usable prototype or pilot which is necessarily the final commercial product and which is too expensive to produce for it to be used only for demonstration and validation purposes.

Experimental development does not include routine or periodic changes made to existing products, production lines, manufacturing processes, services, and other operations in
progress, even if those changes may represent improvements.

Feasibility study

A Feasibility Study is defined as ‘the evaluation and analysis of the potential of a project, which aims at supporting the process of decision-making by objectively and rationally uncovering its
strengths and weaknesses, opportunities and threats, as well as identifying the resources required to carry it through and ultimately its prospects for success.’


To be eligible for funding, the project must meet all of the following criteria.

Innovation and Technology Readiness

Projects must be at TRL 3 – 7 to be eligible for the fund, but no weighting is given at assessment stage to any particular TRL level. Therefore, no preference is given to projects that are higher up the TRL scale and closer to commercialisation.

TRLs provide an indication of the level of maturity of a particular technology and DESNZ’s descriptions of the TRLs is provided in the Appendix: Technology Readiness Levels. As part of the application form applicants will be asked to provide the TRL of their innovation and provide details of the work that has been undertaken to demonstrate that the innovation is that stage.
Successful projects from Stream 2 are eligible to apply but must demonstrate that their starting TRL in this application is equivalent to or higher than their target TRL in Stream 2.

Projects must fall within the definitions of Industrial Research, Experimental Development, or Feasibility Study and be eligible under the subsidy requirements.

Project status

DESNZ are unable to fund retrospective work on projects. The contribution of retrospective work may, however, be considered in the assessment process.

Aid intensity including cumulation: The funding levels applied for must be consistent with the appropriate aid intensity levels (including consideration of the cumulative effect of other forms of aid) and costs must be consistent with the eligible cost criteria


This programme will not support:

• Projects where the AI technology is not applied to a decarbonisation application, even if the technology could potentially in future be applied for decarbonisation purposes
• AI applications that will not assist in achieving the net zero target by 2050
• AI applications that do not facilitate a reduction in greenhouse gas emissions or where the impact on greenhouse gas emissions is uncertain
• AI applications without appropriate mitigations against undesirable social side effects, such as transparency, privacy infringement, cybersecurity threats, etc.
• AI applications which have adverse impact to society and environment
• Early-stage research (TRL 1 – 2) or which are already at production prototype stage (TRL 8 and above)

Funding Costs

The purpose of funding these projects is to get initial evidence of the suitability of the approach to facilitate decarbonisation in the stated sectors and the maximum grant funding is limited to
£350,000 per project.

Match funding

A degree of private match funding from the successful applicant is expected. Such funding may come from applicant’s own resources or external private sector investors but may not
include grant or other similar funding attributable to any public authority funding the same work.

The amount of match funding required will depend on the type of organisation, following the subsidy rules detailed in Section 4.

Before the Grant Offer Letter is issued, the applicant will need to show a credible plan to raise the match funding required for the whole lifetime of the project. Evidence for the plan can be given by showing relevant bank statements or letters from investors.

For further competition guidance, please see here

Interested in applying for this competition?

Book an appointment to speak to one of our advisors to discuss your eligibility to apply for this Grant Funding opportunity.