Ofgem Strategic Innovation Fund Round 4 Discovery

Key Features

Organisations can apply for a share of up to £30 million exclusive of VAT, for collaborative Discovery Phase Projects that meet the Round 4 challenges. This funding is from the Ofgem Strategic Innovation Fund.

Programme:     Ofgem

Award:     Share of up to £30 million

Opens: 23rd Sep 2024

Closes: 23rd Oct 2024

! This scheme is now closed

Overview

This competition is delivered in partnership with the Office of Gas and Electricity Markets (Ofgem). It is funded by the Ofgem Strategic Innovation Fund, which aims to deliver net zero at lowest cost to consumers and support innovative businesses to grow and scale.

Scope

The Strategic Innovation Fund (SIF) aims to deliver net zero at lowest cost to consumers and support innovative businesses to grow and scale.

Each Round 4 Innovation challenge as listed in the Strategic Innovation Fund – Round 4 Innovation Challenge document has different aims.

You must select which challenge you Project is working on.

Challenge 1: Faster Network Deployment represents a greater focus from:

  • Whole System Integration
  • Preparing for a Net Zero Power System
  • Whole System Network Planning

Challenge 2: Greater heat flexibility represents a greater focus from:

  • Whole System Integration, Heat
  • Accelerating Decarbonisation of major demands
  • Unlocking Energy system flexibility to accelerate electrification of heat

Challenge 3: Embedding resilience represents a greater focus from:

  • All Challenges from Round 1
  • Three of the four challenges from Round 2 (excluding Preparing for a net zero power system)
  • Power to Gas for system flexibility

Challenge 4: Accelerating towards net zero energy networks, represents a greater focus from:

  • Accelerating Decarbonisation of major demands

Your Project must meet the eligibility criteria of the Strategic Innovation Fund (SIF), as stipulated in the SIF Governance Document.

Applicants must demonstrate that the Projects deliver a net benefit to consumers through:

  • financial cost reductions, for example, operating the network, energy bills, users of network services
  • emission reduction
  • access to revenues for network users
  • introducing new products, process and services to the UK energy market

Your proposal must focus on network innovation that can benefit GB energy network infrastructure, consumers, operation, and utilisation.

You must address:

  • users and their context
  • constraints affecting the problem or wider context
  • opportunities for improvement
  • environmental impacts

At this stage a Project Direction will be issued for the Discovery Phase only. Successful applicants will be invited to apply for Alpha Phase.

The Discovery Phase of a Project will define the problem and the value in solving it. It will also facilitate a common understanding of consumers’ and network users’ needs from the innovation and identifying constraints.

The Alpha Phase will focus on preparing and testing solutions that are identified during the Discovery Phase, ahead of any large-scale demonstration of the Project in the Beta Phase.

Specific Themes

Innovation Challenge focus themes

You must select the primary Strategic Innovation Fund (SIF) Innovation Challenge focus theme that your project is targeting.

Challenge 1: Faster Network Deployment:

  • Theme 1: novel methods to increase electrical capacity from existing assets or support faster and more efficient connection methods including using digital innovations
  • Theme 2: regional balancing approaches to accelerate low carbon technology deployment

Challenge 2: Greater heat flexibility:

  • Theme 1: flexibility solutions to reduce peak electricity demand from heat decarbonisation

Challenge 3: Embedding resilience:

  • Theme 1: Cross vector approaches to decarbonise rural communities in a resilient manner
  • Theme 2: Transition planning for an energy system with reducing natural gas demand

Challenge 4: Accelerating towards net zero energy networks:

  • Theme 1: Innovation to improve efficiency of network operations

Any proposed project against the points above must also consider contributing to four key cross-cutting areas:

  • inclusive development – ensuring the solution is applicable and accessible to diverse customer and consumer segments through relevant stakeholder engagement and user centric design principles
  • skills and capability – consider throughout the project where upskilling and new capability development is needed and signalling those needs to relevant third parties like academics, training institutes and key supply chain partners
  • supply chains – assess the deliverability and scalability of the solution across the GB network from a supply chain perspective including maturity of supply chains, potential vulnerabilities such as labour requirements, logistical and environmental risks
  • data and digitalisation – harness digitalisation and implementing Energy Data Best Practice across all areas

Eligibility

This award has been designed to be provided on a no subsidy basis, as defined in the Subsidy Control Act 2022.

This means to be eligible, the award will not give an economic advantage on one or more organisations, and you must not be acting economically as an organisation within the meaning of the act.

In limited circumstances, EU State aid rules may apply under The Windsor Framework and a ‘No Aid’ award may be given in accordance with the R&D&I Framework.

Your Project

Your Project must:

  • have total eligible Strategic Innovation Fund (SIF) requested funding of no more than £150,000, exclusive of VAT
  • provide a minimum of 10% of total Project costs as a compulsory contribution from alternative funds
  • start after 1 January 2025
  • end by 31 May 2025
  • be completed within the five month window

Your Project deliverables must be completed within the five month window stated. You are required to fulfil all monitoring requirements, for example, end of phase meetings and Project show and tells, further guidance will be provided.

Projects must always start on the first of the month and this must be stated within your application. Your Project start date will be reflected in your Project Direction if you are successful.

You must only include eligible project costs in your application.

Lead organisation

To lead a Discovery Phase Project you must:

be an Ofgem licensed electricity or gas distribution network, transmission operator, or Electricity System Operator (ESO).

Project partners

Each Discovery Phase Round 4 Challenge has specific project partner requirements in addition to the lead network licensee. The eligibility requirements for the Discovery Phase Challenges are different for each Challenge theme:

Challenge 1: Faster network development partner requirements:

Theme 1: there are no specific partner requirements

Theme 2: you must partner with organisations with proven experience in developing and trialling regional energy models

Challenge 2: Greater heat flexibility partner requirements:

Theme 1: there are no specific partner requirements

Challenge 3: Embedding resilience partner requirements:

Theme 1: must involve a consumer representative group relevant to rural energy development

Theme 2: there are no specific partner requirements

Challenge 4: Accelerating towards net zero energy networks partner requirements:

Theme 1: there are no specific partner requirements

You are encouraged to have other Project Partners in addition to the mandatory requirements listed above. Your Project Partners can include a variety of third-party innovators such as:

  • start-ups
  • SMEs
  • suppliers
  • academics
  • independent researchers
  • disruptors
  • other licenced energy network companies

This list is not intended to be exhaustive.

The Project Direction will be awarded to a single legal entity only.

If successful, the Project Direction will be awarded only to the lead network (Funding Party). Project Partners must be responsible for at least one deliverable in the Discovery Phase.

Ofgem are looking for proposals that involve all the necessary stakeholders relevant to the proposed innovation. We particularly encourage Projects working with suitable SME technology developers and growth companies.

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

Sanctions

This competition will not fund you, or provide any financial benefit to any individual or entities directly or indirectly involved with you, which would expose Innovate UK or any direct or indirect beneficiary of funding from Ofgem to UK Sanctions. For example, through any procurement, commercial, business development or supply chain activity with any entity as lead, partner or subcontractor related to these countries, administrations and terrorist groups.

Use of animals in research and innovation

Innovate UK expects and supports the provision and safeguarding of welfare standards for animals used in research and innovation, according to best practice and up to date guidance.

Any projects selected for funding which involve animals will be asked to provide additional information on welfare and ethical considerations, as well as compliance with any relevant legislation as part of the project start-up process. This information will be reviewed before an award is made.

Exclusions

Ofgem will not fund Projects that do not meet the requirements of the SIF Governance Document.

Funding Costs

A total SIF funding of up to £30 million exclusive of VAT is allocated to the Discovery Phase across the four challenges.

Matched contributions that exceed the 10% mandatory minimum contribution will be assessed as delivering greater value for money. Projects must also consider the suitability of sourcing additional private or public funding where it may be unsuitable for consumer bill payers to finance assets or other equipment and resources.

If you are unsure whether your Project or parts of your Project are eligible for funding in this competition, you must contact Ofgem by email to SIF_Ofgem@iuk.ukri.org at least five working days before the competition closes. Ofgem will decide whether to approve your request.

The total funding available for the competition can change. The funders have the right to:

  • adjust the provisional funding allocations between the phases
  • apply a ‘portfolio’ approach based on technology, geography, innovation, markets, and participants

Ofgem reserve the right to make the final decision as to which Projects are funded.

At the end of Discovery Phase all milestones detailed in the Project Direction must be fulfilled. The successful organisation will be invited to submit an application into the Alpha phase and a further assessment will take place.

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.