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Ofgem and Innovate UK unveil key priorities ahead of the next Strategic Innovation Fund round

In March, the first 40 projects to be awarded funding were selected. Image: Getty.

In March, the first 40 projects to be awarded funding were selected. Image: Getty.

Ofgem and Innovate UK have unveiled the four challenge areas for the second round of innovation funding as part of their Strategic Innovation Fund (SIF).

The areas were put together following consultation with the energy industry and consumers, and incorporate transport, heat, data and integration across the electricity and gas systems.

They are designed to highlight the priorities project proposals should address when applications open in early September 2022.

The challenge areas are:

  • Supporting a just transition – this includes new ways of identifying and supporting vulnerable customers, as well as helping those who are disadvantaged, fuel poor or who are off the gas grid to reduce heat and mobility carbon emissions
  • Preparing for a net zero power system – this includes new ways to help manage low-stability systems, and new sources of energy supply and demand
  • Improving energy system resilience and robustness – this should include developing multi-energy systems and allowing new infrastructure can be rolled out efficiently
  • Accelerating decarbonisation of major energy demands – this will include managing the introduction of low-carbon heat and transport, as well as integrating heat networks use within wider energy network management and improving energy efficiency

“Ofgem set up the Strategic Innovation Fund to harness the power of innovation to help accelerate a fair, affordable and inclusive transition to low carbon energy,” said Neil Kenward, Ofgem director for Strategy and Decarbonisation.

“The challenge areas announced today address some of the most pressing issues on this journey, and we encourage energy networks and innovators to consider how they can develop the best ideas with the greatest potential for this year’s competition.”

The programme will initially open up the ‘discovery’ phase, where projects can apply for £150,000 to further develop their ideas. Following this a panel of judges will choose which they think have the most potential, and these projects will receive up to £500,000 to continue development.

Another selection process will take place further down the line, at which point Ofgem and Innovate UK will help provide funding for the projects to develop large-scale demonstrations of their technologies.

The SIF is a five-year programme with up to £450 million available for energy network innovation.

In March, Ofgem unveiled 40 projects that are receiving a chunk of funding from the first round of the SIF, having initially announced the funding in August 2021.

“We believe we can make the UK the best place in the world to be an energy entrepreneur. The first round of the SIF produced 40 innovation projects across a wide range of themes, showing that the sector is ready to join in this ‘giant leap together’ to decarbonise the energy networks,” said Matt Hastings, deputy director of the Ofgem SIF programme at Innovate UK.

“With the next challenge areas now clear we expect that many dynamic new collaborations will form this year, as energy networks get together with other innovators - inside or outside the energy sector - to take part in the SIF.”

On 25 May a public briefing webinar will be held to provide additional information about the SIF.


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