Ofgem Strategic Innovation Fund announces £5.8 million of funding

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New energy projects to receive £5.8 million in the latest round of the Ofgem Strategic Innovation Fund (SIF).

Energy regulator Ofgem and Innovate UK have announced a £5.8 million package to fund feasibility studies for 44 projects as round three of the Ofgem Strategic Innovation Fund (SIF) gets underway.

Funded by Ofgem and delivered by Innovate UK, the SIF was launched in 2021. The £450 million, five-year programme was designed to help shape the future of Great Britain’s energy networks and accelerate the transition to net zero.

The SIF aims to find potential ideas to key energy network challenges and identify those with the greatest promise as quickly as possible. It then aims to give them the support they need to help the networks achieve net zero.

The 44 successful discovery phase projects will be led by energy network companies, working in partnership with innovators and partner organisations. The projects will focus on the challenges identified as the most pressing faced by energy networks for this third and latest round of the SIF.

The priority challenges

The challenges are:

  • whole system planning and utilisation of networks, to facilitate faster and cheaper network transformation and asset rollout
  • novel technical, process and market approaches to deliver an equitable and secure net zero power system
  • unlocking energy system flexibility to accelerate electrification of heat
  • enabling power-to-gas (P2G) to provide system flexibility and energy network optimisation

Jodie Giles, Director of the Ofgem Strategic Innovation Fund at Innovate UK said:

Congratulations to the 44 projects who have been successful in the Ofgem Strategic Innovation Fund’s Discovery Round three. We know how much work goes into these projects and thank all the people across the partnerships who have collaborated to get to this stage.

People are at the heart of these projects, and we are excited to see what will be delivered with this funding. Tackling climate change will take much more collaboration like this, energy networks working with innovation partners on these challenges are key to getting us to net zero.


Led by SP Energy Networks, Equiflex aims to promote equal access to flexibility markets, ensuring a just transition to net zero in which no consumers are unfairly left behind.

Currently, access to flexibility markets is likely limited, primarily, to the more affluent and engaged consumers. Accessing consumer flexibility benefits network operators, as they manage changing demand and generation patterns. While there is encouraging use of flexibility market options by consumers, products are still in their infancy and require further standardisation.

Equiflex project partners, Frazer-Nash Consulting Ltd, Energy Action Scotland and East Ayrshire Council, are looking at the design of flexibility options targeted at specific groups, such as less engaged and more vulnerable consumers.  They are also looking at the development of a toolkit to help stakeholders, such as local authorities, to evaluate which flexibility options might be best for their local context.

This early intervention in the development of energy flexibility options aims to embed equality in future market design. Participation in flexibility markets can allow consumers to generate income. It can also help to reduce carbon emissions by facilitating a greater utilisation of low carbon energy.


The national gas transmission system currently has the ability to pack additional gas into the lines, known as linepacking. The amount of energy able to be stored by linepacking will decrease as we move toward decarbonisation of the networks with the use of hydrogen. The B-Linepack+ project, led by National Gas, is exploring the feasibility of using geological solutions as intermediate scale storage.

The project works with partners from the University of Edinburgh, Gravitricity Ltd, Southern Gas Networks, Revolutionary Engineering & Digital Design Ltd and Energy Reform Ltd. It is looking at how lined rock shafts, engineered rock caverns and underground silos could provide purpose-built storage to supplement linepack capacity and provide system flexibility. This will enable supply and demand to be managed more effectively for consumers.

Kelvin Shillinglaw, Hydrogen Innovation Engineer, National Gas said:

We look forward to working with our project partners to investigate the feasibility of intermediate scale purpose built geological storage for hydrogen to bolster linepack capability in our network and demonstrate a first-of-a-kind system on Project Union for hydrogen transmission.

The journey to net zero continues 

The SIF allows projects to compete for progressively higher levels of funding, through a phased application model.

Following on from their discovery phase feasibility studies, these 44 successful projects can go on to compete for:

  • alpha proof of concept funding (up to £500,000 over six months)
  • beta large-scale demonstrator funding (no upper limit of funding, lasting up to five years)

All projects have the potential to generate valuable learning that can be shared with others on the innovator journey. Those that go on to beta will represent an investment of millions of pounds in providing energy at the lowest cost to consumers, decarbonising our energy networks, and growing large-scale successful businesses that contribute to the UK’s economic growth.

Marzia Zafar, Ofgem Deputy Director Strategy, Energy Systems Management and Security, said:

To achieve Great Britain’s target of clean power by 2035 we need innovative and creative ideas that can rapidly deliver energy resilience, reliability, and affordability.

By unlocking this latest round of funding we’re helping to empower innovators to further develop the ideas that could help provide the energy solutions of tomorrow.

See the full list of round three discovery projects approved for funding.

Further information

To find out more about the SIF, visit the Ofgem website.

Top image:  Credit: Hiraman, E+, via Getty Images

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