Smart Local Energy Systems: Demonstrators

Key Features

UK organisations can apply for a share of up to £40 million to develop world-class smart local energy system demonstrators.

Programme:     Innovate UK

Award:     Share of up to £40 million

Opens: 8th May 2018

Closes: 25th Jul 2018

! This scheme is now closed

Innovate UK, as part of UK Research and Innovation, will invest up to £40 million from the Prospering from the Energy Revolution Industrial Strategy Challenge Fund. This competition aims to invest in up to 3 world-leading practical smart energy systems demonstrators. These will include new business models that intelligently link supply, storage and demand patterns across power, heating and transport. The result will be a dynamic energy system that can:

  • dramatically reduce whole system energy costs and emissions
  • transform services to users
  • improve efficiency, productivity and resilience
  • reduce environmental impacts

Projects must demonstrate new, smarter, local energy approaches at scale, which can:

  • provide cleaner, cheaper, more desirable energy services for the end user
  • lead to more prosperous and resilient communities
  • prove new business models that are suitable for investment and can grow and replicate in the 2020s
  • provide evidence on the impacts and efficiency of novel energy system approaches by the early 2020s

Your proposal must:

  • demonstrate that you have the necessary financial support
  • have evidence of existing and planned data, infrastructure, supply chains, planning and regulatory approvals, or existing consumers
  • show that you have excellent project management, including stakeholder management and risk management
  • have distinct phases so we can carry out a formal review at the main milestones (at least once a year), to allow Innovate UK to approve continuation of funding
  • show a clear plan for how data and intellectual property (IP) will be generated, managed, owned, protected, shared and exploited within the project, in any linked projects, and after the project finishes

Your smart local demonstrator project must:

  • be based over a specific large UK location such as a medium-sized town
  • seek to optimise energy across a diverse range of energy supplies, varieties of infrastructure and types of demand
  • deliver significantly lower costs and emissions while creating economic benefits for the local area and the UK as a whole
  • encourage private investment to replicate your model nationally through the 2020s
  • use innovations that intelligently link energy supply and demand across power, heat and transport
  • deliver benefits to a range of stakeholders by 2022
  • develop processes and skills in the UK for designing, financing, building and operating smart local energy systems, joining up supply chains where appropriate


The programme will be supported by an Energy Research and Integration Network. We expect projects to build in this support rather than copy it. The Network will consist of the Energy Systems Catapult working with a group of leading researchers and stakeholders.

Your proposal must include plans to share important project data sets with the network. If you are successful you will be required to sign non-disclosure agreements with the Energy Systems Catapult, other network members and the organisations contracted to manage the programme evaluation.

To be eligible for funding you must be a UK-based:

  • business
  • academic organisation
  • charity
  • public sector organisation, local authority, higher education institute or research and technology organisation (RTO)

You must also:

  • carry out at least 90% of your project work in the UK
  • intend to exploit the results from or in the UK
  • work in collaboration with other businesses, research organisations, public sector or third-sector organisations
  • include at least one micro, small or medium-sized enterprise (SME)
  • include at least one university, higher education institution, RTO (including Catapults) or public sector organisation
  • include a local authority or equivalent organisation

Total project costs can be between £26 million and £160 million. To request more than £13 million in grant funding contact Innovate UK by 18 June. Projects can last between 24 and 36 months starting by January 2019 and ending by March 2022 including evaluation.

Innovate UK welcome projects that bring together multiple sources of public and private finance. They are looking for private funding for demonstrators that at least matches our funding, but would expect to see closer to 3 to 1 private funding to UK Research and Innovation grant funding. They expect you to provide an investment up to 3 times the amount you are being funded.

The assessors will take into account the extent to which you have secured private funding and other sources of funding. For the experimental development activity in your demonstrator project you could get funding for your eligible project costs of:

  • up to 45% if you are a micro or small business
  • up to 35% if you are a medium-sized business
  • up to 25% if you are a large business