Ofgem Strategic Innovation Fund Discovery C7

Overview

The Ofgem Strategic Innovation Fund (SIF) Discovery competition provides funding for collaborative projects addressing major innovation challenges across Great Britain’s energy networks.

Delivered by Innovate UK in partnership with Ofgem, the fund aims to support innovation that can contribute to net zero at the lowest cost to consumers while creating opportunities for innovative businesses to grow and scale.

Discovery is the first of four phases, followed by Alpha, Beta and Deployment. Projects should use the Discovery Phase to define the problem, understand the needs of consumers and network users, and identify the constraints that need to be addressed before solutions progress towards testing and demonstration.

This competition is split into five challenges:

• Challenge 1: Industrial and business connection acceleration
• Challenge 2: Faster build and maintenance
• Challenge 3: Instant use domestic energy devices
• Challenge 4: Eliminating energy outages
• Challenge 5: Decentralised system balancing

Scope

This competition is delivered by Innovate UK 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.

Each Innovation Challenge has different aims. Projects must select which challenge they are working on.

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

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

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

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

Projects 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 the Alpha Phase.

The Discovery Phase 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 identify constraints.

The Alpha Phase will focus on preparing and testing solutions identified during the Discovery Phase, ahead of any large-scale demonstration in the Beta Phase. The Deployment Phase must have a proven solution to be deployed into business as usual.

Key themes and topics

Projects must address one of the following Innovation Challenges:

• Challenge 1: Industrial and business connection acceleration
• Challenge 2: Faster build and maintenance
• Challenge 3: Instant use domestic energy devices
• Challenge 4: Eliminating energy outages
• Challenge 5: Decentralised system balancing

Projects must also consider contributing to the following cross-cutting areas:

Cost reduction: drastically reducing whole-life infrastructure costs and enhancing resilience to ensure affordability and create economic savings and opportunities. New business models and service definitions should allow value to be better realised by customers.

Customer outcomes: radically simplifying engagement with networks to connect assets and delivering significantly higher resilience to meet the needs of customers, from households to major sites.

Economic growth: accelerating connections across vectors and asset scales, while minimising disruption caused by infrastructure works, to streamline the expansion of energy-intensive sites and uptake of new technology by consumers.

Decarbonisation: reshaping the architecture of system operations to support the rapid connection of smart, flexible and decarbonised demand assets. Improving the time and cost efficiency of infrastructure deployment should also allow networks to support new clean energy resources.

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

Project duration

1 to 5 months

Must start after 1 January 2027

End by 31 May 2027

Projects must be completed within the five-month window and must always start on the first day of the month.

Award value

Grant funding request up to £200,000, exclusive of VAT

Funding rates

Projects must provide a minimum of 10% of total project costs from private funds.

Matched contributions exceeding the mandatory 10% minimum will be assessed as delivering greater value for money.

Eligibility criteria

• Projects must be collaborative and led by an Ofgem licensed gas distribution network, gas transmission network, electricity transmission network, electricity distribution network or the National Energy System Operator (NESO)
• Projects must include at least one grant claiming project partner
• Collaborators can include start-ups; SMEs; suppliers; academics; independent researchers; disruptors; other licensed energy network companies; and other relevant organisations
• The lead and at least one other organisation must apply for funding
• This grant is provided on a no subsidy basis under the Subsidy Control Act 2022. In limited circumstances, EU State aid rules may apply under the Windsor Framework