Industrial Decarbonisation: Local Industrial Decarbonisation Plans

Overview

Innovate UK, part of UK Research and Innovation, will work with the Department for Energy Security and Net Zero (DESNZ) to invest up to £5 million in place-based industrial decarbonisation plans.

The Local Industrial Decarbonisation Plans Competition (LIDP) provides support for industrial manufacturers, not located within the UK’s existing industrial clusters, to develop plans to reduce their emissions and avoid carbon leakage.

The competitive grant funding will support the advancement of place-based industrial decarbonisation plans. This will involve collaboration between closely located industrial businesses and other stakeholders, as well as upskilling their capabilities ahead of introducing low-emission technologies.

The objectives of this competition are as follows:

To support the development of credible, context-sensitive, strategic plans for decarbonising local industrial clusters
To increase organisational collaboration and strengthen decarbonisation planning skills, capacity and capability in local industrial clusters
To gather evidence to inform decarbonisation of other local industrial clusters and dispersed sites

Through use of the fund we expect organisations to come together to form local clusters, which can be made up of closely located industrial businesses and other stakeholders, with the aim to establish a detailed, implementable plan for decarbonisation of their cluster.

This should include identification of a pipeline of decarbonisation projects that can be taken forward by the cluster towards deployment, including common decarbonisation infrastructure.

Local clusters must also provide evidence of how organisational structures will be established with the technical capabilities and coordinated capacity to drive implementation of the plan.

Please note: this funding opportunity is not for deployment of decarbonisation approaches.

Scope

The aim of this competition is to support the creation of credible industrial decarbonisation plans for local industrial clusters. Local clusters can be made up of groups of closely located, emitting industrial sites and other stakeholders. The funding is intended to increase collaboration between organisations, strengthen decarbonisation planning skills and enable development of organisational structures for place-based decarbonisation.

Your proposal must:

demonstrate the regional and national significance of your project
demonstrate what networks, stakeholders and audiences will contribute to the project and what information will be disseminated through a dissemination plan
develop a strong understanding of emissions data and developing pathways to reach Net Zero by 2050
consider the wider cross-economy decarbonisation scenarios
capture existing activity in the cluster on industrial decarbonisation
identify the key industrial decarbonisation project options required to achieve carbon abatement in the local cluster, for example, common infrastructure and site-specific
identify barriers and enablers to industrial decarbonisation in the local cluster
analyse decarbonisation benefits and costs, including emissions, economic, environmental and social impact, and quantifying these where possible
identify key industrial decarbonisation stakeholders, plans for further engagement and future development of organisational structures designed to implement content of plan
demonstrate how the project will lead to decarbonisation of your local industrial cluster after the funding from this competition ends in March 2025

It is the responsibility of applicants to get independent subsidy control and State aid legal advice.

Innovate UK want to fund a portfolio of projects, across this competition, based on:

geographical location
the range of industries
the range of technologies
project cost and funding available
project scale and replicability
environmental impacts
project timescales
alignment with and contribution to wider cross-economy decarbonisation, and decarbonisation of other clusters
other government funded projects in the region of the cluster, for example projects funded through the Industrial Decarbonisation Challenge (IDC)
stakeholder engagement
alignment with other government decarbonisation and place-based policies and funding

Specific Themes

It is recognised that local industrial clusters will be at different stages of development but we would anticipate that your local cluster decarbonisation plan would include:

technology options
emissions data
commercial arrangements
stakeholders
funding and finance
knowledge dissemination, in the form of a dissemination plan demonstrating how learning from the project will be gathered and disseminated to other industrial clusters and dispersed sites
the economic, social and environmental impact of decarbonising the local cluster
existing decarbonisation activities
barriers and enablers
geographic coverage
timelines
exploitation plan

Eligibility

Your project must:

have a grant funding request between £75,000 and £800,000
start by 1 January 2024
end by 31 December 2024
have a minimum duration of 6 months
collaborate with partners
carry out all of its project work in the UK
intend to exploit the results from or in the UK

You must only include eligible project costs in your application.

Under current restrictions, this competition will not fund any procurement, commercial, business development or supply chain activity with any Russian or Belarusian entity as lead, partner or subcontractor. This includes any goods or services originating from a Russian or Belarusian source.

To lead a project your organisation must:

be a UK registered business of any size, charity, not for profit, research and technology organisation (RTO) or public sector organisation
collaborate with other UK registered organisations

To collaborate with the lead, your organisation must be one of the following UK registered:

business of any size
academic institution
charity
not for profit
public sector organisation
research and technology organisation (RTO)

Each partner organisation must be invited into the Innovation Funding Service by the lead to collaborate on a project. Once partners have accepted the invitation, they will be asked to login or to create an account in the Innovation Funding Service. They are responsible for entering their own project costs into the application.

To be an eligible collaboration, the lead and at least one other organisation must apply for funding when entering their costs into the application.

Your project can include partners that do not receive any of this competition’s funding, for example non-UK businesses. Their costs will count towards the total project costs.

Subcontractors are allowed in this competition.

Subcontractors can be from anywhere in the UK and you must select them through your usual procurement process.

All subcontractor costs must be justified and appropriate to the total project costs.

A business, research and technology organisation (RTO), charity, not for profit or public sector organisation can lead on one application and can be included as a collaborator in two further applications.

If an organisation is not leading an application, it can collaborate in up to two applications.

You cannot use a previously submitted application to apply for this competition

Exclusions

Innovate UK are not funding projects that are:

single industrial facilities
focused on deployment activities
pre-FEED (front end engineering design) or FEED studies
not primarily focused on industrial decarbonisation, however plans that are primarily focused on industry, but which can show synergies with decarbonisation of other sectors, for example, waste, power or transport, will be considered
considered to duplicate the scope of IDC Clusters, however plans that are not covered by the IDC clusters, but which can show how their plans will connect to the clusters, will be accepted

More information on the term ‘industry’ and on the IDC clusters can be found in the supporting information section of this competition brief.

Innovate UK cannot fund projects that are:

dependent on export performance, for example giving a subsidy to a baker on the condition that it exports a certain quantity of bread to another country
dependent on domestic inputs usage, for example giving a subsidy to a baker on the condition that it uses 50% UK flour in their product

Funding Costs

Up to £5 million is available to fund feasibility studies for place-based industrial decarbonisation plans. Funding will be in the form of a grant.

If your organisation’s work on the project is commercial or economic, your funding request must not exceed the limits below. These limits apply even if your organisation normally acts non-economically but for the purpose of this project will be undertaking commercial or economic activity.

For feasibility studies, you could get funding for your eligible project costs of:

up to 70% if you are a micro or small organisation
up to 60% if you are a medium sized organisation
up to 50% if you are a large organisation

For more information on company sizes, please refer to the company accounts guidance. This is a change from the EU definition unless you are applying under State aid.

If you are applying for an award funded under State aid Regulations, the definitions are set out in the European Commission Recommendation of 6 May 2003.

Research participation

The public sector organisations, charities and research organisations undertaking non-economic activity as part of the project can share up to 50% of the total eligible project costs.

Within this 50% limit If your consortium contains:

more than one public sector organisation, charity or research organisation, this maximum is shared between them
academic organisations and research and technology (RTO) organisations undertaking non-economic activity as part of the project, their share must not exceed 30% of the total eligible project costs

Public sector organisations, charities and research organisations could get funding of eligible project costs of up to:

80% of full economic costs (FEC) if you are a Je-S registered institution such as an academic
100% of your project costs if you are an RTO, charity, not for profit organisation, public sector organisation or non Je-S registered research organisation

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