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Ofgem awards funding to 53 new projects that aim to reduce energy bills

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Ofgem has announced which projects are set to receive a share of the Strategic Innovation Fund (SIF), which was set up to encourage the creation of new innovations that will help reduce energy bills. 

A total of 53 projects covering both the electricity and gas sector are set to receive funding, with the projects focused on delivering a cleaner, cheaper, more secure energy future for Great Britain. 

Each project will receive up to £150,000 in funding, which was awarded jointly by both Ofgem and Innovate UK. The funding comes from the Strategic Innovation Fund, which was set up in 2021, with Innovate UK estimating that the projects funded under the scheme could deliver cost savings in the billions of pounds over the next 10-15 years. 

The latest 53 chosen projects explore new ideas with the potential to help consumers and transform the energy system in the coming years. The projects, currently in the conceptual phase, are being led by energy network companies working in partnership with innovators and partner organisations. 

For example, UK Power Networks has received funding for 15 new projects, including:

  • Heat Risers: an innovative heating project aiming to accelerate the decarbonisation of multi-occupancy buildings and reduce costs for all, using whole building solutions.
  • Lightspeed: aims to develop bi-directional lamppost-based EV charging that would support smart charging and feeding energy back into the grid, while providing faster EV charging at 7 – 22 kW, without requiring major network upgrades.
  • Connectrolyser: aims to scale hydrogen electrolyser hub development by developing a novel electricity connection agreement and flexibility product to speed up new connections and support the transition to Net Zero to meet the demands of society and industry.
  • SHIELD: aims to test and deploy new approaches and business models for installing low carbon technologies such as photovoltaic, renewable generation, energy storage, and electric vehicles – in conjunction with low carbon heating solutions to make the decarbonisation of heat and energy affordable and accessible to vulnerable consumers.

Additional projects funded across the UK include: 

  • The development of large-scale battery storage, which will be needed in a grid which utilises intermittent renewable energy sources such as wind and solar power
  • Helping speed up connections of wind and solar power to the grid and improving the efficiency of green hydrogen production whilst also making the most of existing energy infrastructure
  • Supporting a ‘just energy transition’ including helping consumers who may be disadvantaged, fuel-poor, living in vulnerable circumstances or off the gas grid reduce their heating and transport emission.

All of the projects that have received funding have been given up to three months to further explore and develop their concepts, assessing their potential and preparing plans for future phases. Each project will then be assessed by a panel of SIF judges and those judged to have the greatest potential will then be awarded up to £500,000 for a further six-month proof of concept phase, which would start in the summer. This will be followed by a third phase, whereby the remaining projects will compete for funding to demonstrate prototypes starting in early 2024.  

The projects which ultimately are commercially developed could start to be rolled out operationally into energy networks in the mid to late 2020s and play an important part in helping Great Britain achieve a cleaner, cheaper and more secure energy future.

Neil Kenward, Ofgem Director for Strategy and Decarbonisation, noted, “Great Britain has a long history of being in the vanguard of innovation. Our work with Innovate UK is empowering today’s innovators and helping establish Britain as an entrepreneurial energy innovation hub developing and delivering the power solutions of tomorrow.

“This will help in the quest to transform our energy systems at pace and boost supplies of clean and secure energy at the least cost to consumers and ensure that no one is left behind.”

Mike Biddle, Executive Director for Net Zero at Innovate UK, added, “Our vision is for the UK to prosper from being the economy that transitions fastest to net zero. We’re delighted to be working closely with Ofgem and the energy sector on the Strategic Innovation Fund, and to see a new cohort of innovative projects coming through that will help drive the decarbonisation of our energy networks.”

Matt Hastings, Deputy Director of the Ofgem SIF programme at Innovate UK, concluded, “As projects from our last year’s challenges move closer towards their demonstration phase, and real-world deployment, we’re kicking off the next batch of Discovery projects in parallel.

“Discovery is all about urgent learning and taking risks; we expect a degree of failure. This ensures that only the best ideas make it through to the next phases, with the amount of projects reducing as the level of consumer investment in SIF projects increases.”

You can find out more details about each of the 52 projects to receive funding here.

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