Strategic Innovation Fund (SIF) – Funding Eligibility and Application Details

Who Can Apply

This funding is structured to comply with the Subsidy Control Act 2022, meaning it should not provide an unfair economic advantage to any organisation. Applicants must ensure they are not operating in an economic capacity under the definitions of the Act.

In some cases, EU State aid rules under the Windsor Framework may be applicable, allowing for a "No Aid" classification under the R&D&I Framework.

Project Requirements

To qualify, your project must:

• Request no more than £150,000 in total SIF funding (excluding VAT).
• Secure a minimum of 10% of total project costs from other funding sources.
• Start after 1 May 2025 and end by 30 September 2025 within a strict five-month timeframe.
• Comply with all reporting and monitoring requirements, including end-of-phase meetings and project reviews.

Projects must always commence on the first of a month, even if it falls on a non-working day. Work should not begin until Project Direction approval is received, as this will define the official start date.Only eligible project costs should be included in the funding application. Specific cost eligibility details are available in the competition guidelines.Lead OrganisationTo lead a Discovery Phase Project, you must be a licensed:

• Electricity or gas distribution network operator
• Transmission operator
• Electricity System Operator (ESO)

Project PartnersEach challenge within Discovery Phase Round 4 has specific partner requirements:Challenge 1: Faster Network Deployment

• Theme 1: No mandatory partner requirements.
• Theme 2: Must collaborate with experts in developing and trialling regional energy models.

Challenge 2: Greater Heat Flexibility

• Theme 1: No mandatory partner requirements.

Challenge 3: Embedding Resilience

• Theme 1: Must involve a consumer representative group relevant to rural energy development.
• Theme 2: No mandatory partner requirements.

Challenge 4: Accelerating Towards Net Zero Energy Networks

• Theme 1: No mandatory partner requirements.

Applicants are encouraged to work with additional partners, including:

• Start-ups and SMEs
• Suppliers and technology providers
• Academics and independent researchers
• Other licensed energy network companies

The Project Direction will be awarded to a single legal entity—the lead organisation, which is responsible for project management and compliance. Project partners must contribute to at least one deliverable within the Discovery Phase.Collaboration Requirements:

• A minimum of two organisations (lead + at least one partner) must apply for funding.
• Project partners must be added to the Innovation Funding Service (IFS) platform by the lead organisation.

Funding Restrictions Applicants must not engage in activities that expose Innovate UK or Ofgem to UK sanctions, including associations with restricted entities or jurisdictions.Animal Research ComplianceProjects involving animals must adhere to UKRI guidance on research ethics, welfare, and legal compliance. Additional documentation will be required before funding approval.Your ProposalThe Strategic Innovation Fund (SIF) is designed to support the transition to net zero while minimising costs for consumers and fostering innovation.Each Round 4 Innovation Challenge has unique objectives. Applicants must specify which challenge their project aligns with:Innovation ChallengesChallenge 1: Faster Network Deployment
Focuses on:

• Whole system integration
• Net zero power system readiness
• Optimised network planning

Challenge 2: Greater Heat Flexibility
Focuses on:

• Integrating heat systems into energy networks
• Decarbonising major energy demands
• Enhancing flexibility in energy use

Challenge 3: Embedding Resilience
Focuses on:

• Strengthening energy system resilience
• Decarbonisation strategies for rural communities
• Transition planning for reduced natural gas dependency

Challenge 4: Accelerating Towards Net Zero Energy Networks
Focuses on:

• Improving operational efficiency of energy networks
• Scaling up innovative solutions for decarbonisation

Project Eligibility and ImpactApplicants must demonstrate how their project benefits energy consumers by:

• Reducing costs (e.g., lower energy bills, improved efficiency).
• Lowering emissions to support net zero targets.
• Enhancing revenue opportunities for network users.
• Introducing new technologies or services to the UK energy market.

Projects should focus on network innovation that enhances:

• Energy infrastructure
• Consumer access and affordability
• System operation and efficiency

Proposals must address:

• User needs and challenges
• Operational and regulatory constraints
• Opportunities for technological advancement
• Environmental and sustainability impacts

Project PhasesDiscovery Phase:
Defines the problem, assesses potential solutions, and evaluates consumer and industry needs.Alpha Phase:
Develops and tests solutions identified during the Discovery Phase before scaling up.Beta Phase:
Demonstrates large-scale application of tested solutions.Key Themes Across All ChallengesRegardless of the selected challenge, all projects should consider:

• Inclusive development: Ensuring solutions are accessible across different user groups.
• Skills and capability: Identifying training needs and knowledge gaps.
• Supply chains: Assessing feasibility and scalability of solutions.
• Data and digitalisation: Leveraging digital tools and best practices for energy data management.

‍