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1. Key technology components for local energy systems
briefing event
15th
July 2019
Industrial Strategy:
Prospering from the energy revolution

2. Agenda
• Prospering from the Energy Revolution programme
• Competition scope
• Q&A
• Application process
• Q&A
• Webcast close

3. Rob Saunders, Innovate UK (Interim Challenge Director)
Introduction:
Prospering from the energy revolution

4. Prospering from the
Energy Revolution
Proving cleaner, cheaper local energy
approaches that people want to buy in to.
Rob Saunders
Challenge Director

5. The Industrial Strategy Challenge Fund

6. Wave 2 challenges
Data to early diagnosis
and precision medicine
(up to £196m)
Healthy ageing
(up to £98m)
Next generation
services (up to
£20m)
Audience of the
future (up to £33m)
Quantum technology
(up to £20m)
Transforming
construction
(up to £170m)
Transforming food
production (up to £90m)
Prospering from the
energy revolution
(up to £103m)
And Wave 3 in business case approval for launch…….

7. Prospering from the Energy Revolution:
The Opportunity
Costs Digital UK Strengths
Consumer Local Finance

8. Technology
Energy Revolution:
Pull, not push
‘Traditional’ energy innovation approach
A new approach
System Service
Business
model
Value
chain
Technology System Service
Business
model

9. Energy Revolution:
Programme Objectives
Prove investable, scalable local business models by 2022, that
•deliver cleaner, cheaper energy services
•build more prosperous and resilient communities
•benefit the whole energy system
•use integrated, intelligent approaches
Unlock 10x future private investment
in local integrated energy systems in 2020s (vs business as usual)
Accelerate new products and services to commercialisation
creating real world proving grounds
Build UK leadership in integrated energy services provision

10. Prospering from the energy revolution
Integrated intelligently
to please consumers
In scalable, replicable
and investable models
Large-Scale power, heat
and mobility delivery

11. Future energy model proving
£51m£32m
Energy Revolution:
Committing >£100m in public funding
Key Technologies
Research, Expertise, Capability, Coordination
£16m
Practical demonstratorsFuture designs
£3m

12. 12
Energy Revolution:
Project locations

13. Urban,
mixed
residential
and small
non-
domestic
(x3)
Island (x3)
Urban, commercial premises (x1)
Industrial cluster (x2)
Medium-
sized town
with rural
metropolit
an area
(x4)
Rural with small town (x2)
Project archetypes

14. Matt Hastings, Innovate UK (Competition Lead)
Key technology components for local
energy systems: competition scope

15. Key technology
components for local
energy systems
competition
Matt Hastings – Energy Systems Innovation Lead
matt.hastings@innovateuk.ukri.org
@Capt_Kilowatt

16. Competition summary
Up to £3m for the development of technology components that can enhance the
efficiency of local energy systems. These should deliver cleaner, cheaper energy
services and create more prosperous and resilient communities across the UK.
The competition is open to technology components that:
•optimise the ‘whole system’ efficiency of localised energy systems and
•aligns with the overall objectives of the Industrial Strategy Challenge
Fund’s Prospering from the Energy Revolution challenge

17. We will fund innovations in these areas:
•Applications for monitoring electricity and/or gas network hardware and software.
•Enhancing integration between local and national electricity networks, both electricity system operators
(ESO) and distribution system operators (DSO).
•Enhancing integration between local and national electricity markets (wholesale market, balancing
mechanism and ancillary services)
•Multi-site, real time generation optimisation across multiple operators or aggregators.
•Enhancing the efficiency of heat networks.
•Heat and cold storage, especially inter-seasonal storage.
•Optimised vector coupling solutions: electricity, heat and transport.
Competition themes

18. For example:
•Meshed LV/MV network monitoring hardware tied to deep learning software application
•DSO/ESO market platforms and/or specific tools/applications
•Transmission and Distribution network coupling devices
•EV charging/grid constraints integration or heat networks that tie into frequency regulation
•Heating network optimisation, monitoring and enhancing the performance of the network
Project examples

19. Businesses must have eligible costs funded at the below rates. Matched funding must
come from sources of private funding.
Applicant Business Size Industrial Research
Micro/Small 70%
Medium 60%
Large 50%
An SME working on its own can claim up to a maximum of £300,000
Research organisations are capped at 30% of the total project costs
Matched Funding

20. Competition Opens 22nd
July 2019
Competition Closes 9th
October 2019 at 12.00pm (noon)
Applicants notified 13th
December 2019
Project start April 2020
Project completion March 2022
Competition timescale

21. Questions?
Matt Hastings
Innovation lead – energy systems (Innovate UK)
Matt.Hastings@innovateuk.ukri.org

22. Fiona Newbury, Innovate UK
Key technology components for local
energy systems: competition process

23. Eligibility Criteria

24. Project Eligibility
Lead must be a UK-based business of any size
At least one UK SME
Be collaborative unless led by an SME who can elect to act
on their own if they wish to (Maximum Claim for an SME
working on their own is £300,000)
You must carry out your project in the UK
Exploit the results from / in the UK
Project cost £100,000 to £500,000
Project length
24 months
Must start by 1st
April 2020 and end by 31st
march 2022
Eligibility criteria

25. •Business – Small/Micro, Medium or Large (EU definition)
•Research Organisation (RO):
• Universities (HEIs)
• Non profit distributing Research & Technology Organisation (RTO) including Catapults
• Public Sector Research Establishments (PSRE)
• Research Council Institutes (RCI)
•Public sector organisations and charities doing research activity
•Must be based in the UK
•Check out the EU definition of a business (it may affect the grant you are able to claim)
http://ec.europa.eu/growth/smes/business-friendly-environment/sme-definition_en
•If you are 100% owned by a large parent company as a small subsidiary this means by EU rules you are classed as a
large company and will only be entitled to the relevant grant
Types of organisations we fund

26. Proposals that:
•do not meet the criteria as detailed in the brief
•are not innovative
•Involve niche configurations, unlikely to be replicable or scalable across the UK in
the 2020s
Who can we not fund

27. Eligibility for State Aid
• Innovate UK is offering funding for this competition under the General Block Exemption Regulation.
This is available to eligible UK businesses.
• We are unable to grant funding to limited liability companies meeting the condition known as
‘undertakings in difficulty’.
• This is where more than half of a company’s subscribed share capital has disappeared as a
result of accumulated losses.
• This test only applies to companies that are more than 3 years old.
• If you have a parent company the test can be performed on your parent or holding company.
• When submitting an application you must certify that you are eligible for state aid. If you are unsure,
please take legal advice before applying.
• Should you be successful, we will apply this test as part of our viability checks before confirming the
grant offer.
• Further information is available on our website in the general guidance under state aid

28. State Aid – Article 25
• Special rules apply to:
o Fisheries,
• Funding for R&D projects split in to 3 categories; Feasibility studies, Industrial research & Experimental development.
• Applies to almost all sectors of the economy and has a wide range of eligible costs.
• Pre-approved state aid covering:
o Aid for research and development and
innovation,
o Regional aid
o Aid to SMEs in the form of investment aid,
operating aid and SMEs access to finance,
o Aid for environmental protection,
o Training aid,
o Recruitment and employment aid for
disadvantaged workers or workers with
disabilities,
o Aid to make good the damage caused by
certain natural disasters,
o Social aid for transport for residents for remote
regions,
o Aid for broadband infrastructures,
o Aid for culture and heritage conservation,
o Aid for sport and multifunctional recreational
infrastructures,
o Aid for local infrastructure.
o Agriculture, o Companies in difficulty, o Companies undergoing a state
aid recovery order.

29. • The aim of our State Aid scheme is to:
• optimise the level of funding to business and
• recognise the importance of research base to project
• At least 70% of total eligible project costs must be incurred by business
• The maximum level (30% of project costs) is shared by all research organisations in
the project
Participation Rules

30. In all collaborative projects there must be:
•A Business led consortium, where the Business can be of any size
•An SME if the Lead is not an SME
•at least two organisations claiming grant within the application (including the lead)
•evidence of effective collaboration
• we would expect to see the structure and rationale of the collaboration
described in the application.
What is collaboration?

31. Making more than one application and
resubmissions
• Any one business may be involved in up to 3 applications to this competition, but can only be the lead
partner in one application
• Any one research and technology organisation may only be the lead partner in one application. There must
be at least two other UK businesses (at least 1 SME) claiming grant. If they are leading an application they
may be involved in up to 3 applications to this competition.
• If a research and technology organisation is not the lead on any application, they can be a partner in any
number of applications
• If an application is unsuccessful, you can use the feedback received to reapply for the same project into
either another round of this competition or another competition. A project proposal can only be submitted
twice

32. Other Innovate UK projects
• If you have an outstanding final claim and Independent Accountant Report (IAR) on any
live Innovate UK project, you will not be eligible to apply for grant funding in this
competition, as a lead or a partner organisation.
• If you applied to a previous competition as the lead or sole company and were awarded
funding by Innovate UK, but did not make a substantial effort to exploit that award, we
will award no more funding to you.

33. Timeline Dates
Competition Opens 22nd
July 2019
Briefing Event 15th
July 2015
Submission Deadline 12 Noon 9th
October 2019
Applicants informed 13th December 2019
Key Dates

34. The Innovation Funding Service (IFS)

35. Search for a funding competition and review criteria

36. Applicant: create an account
To create your account:
UK based businesses - Use Companies House
lookup as it speeds up our checks by providing
your company number and your are unable to
enter it at a later date
Research organisations, academics &
Universities - Enter your information manually
so you’re not listed as a business on IFS and
ensure you receive the correct funding

37. Project Details
• Application Team
- Collaborators: Invite organisations who you are working with on the project
- Contributors: Invite colleagues from your own organisation to help you complete your applicatio
• Application Details
- Title, Timescales, Research Category, Innovation Area & Resubmission (y/n)
• Project Summary
- Short summary and objectives of the project including what is innovative about it
• Public Description
- Description of your project which will be published if you are successful
• Scope - How does your project align with the scope of this competition?
- If your project is not in scope, it will be ineligible for funding

38. Application form
Question 1 Need or challenge
Question 2 Approach and innovation
Question 3 Team and resources
Question 4 Market awareness
Question 5 Outcomes and route to market
Question 6 Wider impacts
Question 7 Project management
Question 8 Risks
Question 9 Additionality
Question 10 Costs and value for money
Appendix Q3
Appendix Q7
Appendix Q8
Appendix Q2
Application Questions
Detailed Guidance
Available on IFS

39. Application Finances

40. You are unable to claim funding if:
You are an overseas organisation so your company number begins with FC
You organisation is setup as a branch so your company number begins with BR
Your company is based in Jersey so your company number begins with JE

41. Labour costs
Ineligible:
•Dividends
•Bonuses
•Non productive time
Eligible:
•Staff working directly
on project.
•Paid by PAYE
•NI, pension, non-
discretionary costs.
Labour

42. Overheads
Innovate UK’s definition:
Additional costs and operational expenses incurred directly
as a result of the project. These could include additional
costs for administrative staff, general IT, rent and utilities
Indirect (administration) overheads
• please ensure they are additional and directly
attributable to the delivery of the project
Direct overheads
• E.g. office utilities, IT infrastructure, laptop
provision not covered by capital usage
• must be directly attributable to the project
• Provide detailed breakdown together with
methodology/basis of apportionment

43. Material costs
Please be clear on what
the materials are, just
putting consumables
doesn’t provide enough
detail and we will request
more information should
you be successful

44. Capital equipment usage
Eligible:
•Used in the project or shared with
day-to-day production
Calculations will need to be inline with your
accounting practices.
Even if the equipment is depreciated fully over
the life of the project this must be added under
capital equipment.

45. Sub-contractors
Eligible:
•Justified and quantified
•If using non-UK sub-contractors are
being used you will need to provide
strong justification on why an UK-based
sub-contractor is not being used
•If you’re sub-contracting to a parent or
sister company, please ensure you list at
cost and do not include profit.

46. Travel & Subsistence
Eligible:
Costs must be directly linked to
the project
Please breakdown your costs as
follows:
•Travel
•Accommodation
•Subsistence
If you have an annual trip to visit the parent company this is not an eligible cost

47. Other costs
Eligible:
•Costs that could not be added under
previous headings.
•Do not double count
•Patent filing costs for new IP – SMEs
up to £7,500

48. Funding
Funding rules
• The level of funding awarded will depend upon the type of organisation
and the type of research being undertaken in the project
• Funding is calculated by project participant
IFS will advise the maximum grant % you can request based upon your
answers to:
• Type (and size) of organisation
• Research category defined by the lead applicant in the Application
Details section of the application

49. Funding dependent upon type of organisation
Organisation /
Type of Activity
Technical Feasibility
Studies and Industrial
Research
Notes
Business
(economic activity)
Micro/Small – 70%
Medium – 60%
Large – 50%
Experimental Development is not funded in this competition.
Definitions for Feasibility studies and Industrial research can be
found in the general guidance notes.
Research
Organisation
(non-economic
activity)
Universities – 100%
(80% of Full Economic
Costs)
Other research
organisations can claim
100% of their project
costs – see note:
Other research organisations must:
•be non-profit distributing and
•disseminate the project results &
•explain in the application form how this will be done
Public Sector
Organisation or
Charity
(non-economic
activity)
100% of eligible costs Must be:
•Be performing research activity &
•disseminate project results & explain in the application form
how this will be done
•ensure that the eligible costs do not include work / costs already
funded from other public sector bodies

50. Worked example – £500k total cost project:
Project costs for 5 partners (2 SME, 1 University, a Catapult and 1 large), doing industrial research.
Consortium example
Total Eligible
Project Costs
Maximum % of
eligible costs
which may be
claimed as a
grant
Innovate UK
Grant
Project
Contribution
Business Medium £130,000 60% £78,000 £52,000
Business Medium £90,000 60% £54,000 £36,000
Business Large £130,000 50% £65,000 £65,000
University HEI (80% FEC) £75,000 100% £75,000 nil**
Catapult RTO £75,000 100% £75,000 nil
Total £500,000 £347,000 £153,000
** 20% FEC not to be shown as a contribution
Research Base Costs £150,000
Research base % of Total Eligible costs (cannot exceed 30%) 30.00%

51. Academic Partners

52. Why Je-S?
• We use the Research Councils’ Joint Electronic Submission System (Je-S) to
collect academic finances
• The Je-S system automates the collection of Full Economic Costs (FEC) based
costs from academic partners and tells them exactly what numbers should be
used in the application form for their costs
• Also to collect project finance details from non-HEIs (e.g. RTOs) that are
claiming they are carrying out academic quality work and want to be funded on
an FEC basis
• Using Je-S means that Innovate UK follows standard Research Council
guidelines on funding universities and enables Research Councils to easily co-
fund Innovate UK projects

53. • Enter the TSB
reference number
here
• Enter the TSB
Contribution column
figures from your J-
eS output document
into the project costs
section of the
application
• Upload the Je-S with
council status form
as a PDF at the
bottom of the screen
Project costs – academic partners

54. Normal Je-S application elements
• Not just the financials
• E.g. Justification of resources
• E.g Pathways to impact
• Full details on the Je-S system
• Queries about Je-S via the Je-S Helpdesk
• JeSHelp@rcuk.ac.uk
• 01793 444164

55. Submitting your application

56. Project cost summary
All organisations can see a summary of project costs
Ensure the highlighted
costs fits the criteria for
this competition. So
between £100k and £500k

57. Checking your finances are complete
IFS checks
•all organisations have marked
their finances as complete
•research organisation
participation is no greater than
30% of the total project costs

58. Submit your application early!

59. Assessment

60. Application Assessment
All applications are assessed by independent assessors drawn from industry and academia
What do they look for?
•Clear and concise answers
•The right amount of information
• not too much detail
• no assumptions
•Quantification and justification
•A proposal that presents a viable opportunity for growth, a level of innovation that
necessitates public sector investment and has the right team and approach to be successful
Keep your assessors
engaged and interested in
your proposal. You want
them to be fascinated and
excited by your idea!

61. Application Assessment
• The score spread shows the difference
between the top and bottom scores
• If score spread is 30 or more we will look
to see if an outlier is apparent
• If there is a 3 or more appear in either
the two columns Count of No Scope or
Count of No Recc’d we review the
applications feedback and if justified, the
application will not be eligible for
funding.

62. • The green box highlights a particular assessors scores on an application
• The purple box highlights a set of scores for a particular question
• We look for a difference of 20 or more within the assessors total score to identify an outlier. At first glimpse we
would consider assessor 3 to be the outlier with a score of 62 but this must be backed up by the feedback
Identifying outliers

63. Assessor feedback

64. Project setup for successful applicants

65. IFS for successful applicants
Project Set up:
•7 steps to complete
•Applicable to all grant claiming partners
•Must be completed within 30 days
•Projects must start within 90 days or funding
may be withdrawn
•Confirmation of your bank account is required
to ensure we are paying the correct
organisation you may/will be asked to provide
a redacted bank statements to confirm this
•Project change requests cannot be submitted
before the project starts

66. Collaboration Agreement
• Original agreement signed by all participants
• Key Features:
• Who is in the Consortium?
• What are the aims, and how is the work divided up?
• Ownership of IPR
• Management of consortium
Negotiating a Collaboration Agreement can be complex and time consuming. Start work on
this at an early stage in the process.

67. Grant claims and payments
• All grants are claimable quarterly in arrears
• Claims can only be made for costs incurred and paid between the project start and end dates
• Claims may be subject to an independent audit (including all academic partners) according to
grant size
• Claims are only paid once quarterly reporting and necessary audits are complete
• Projects over 6 months are monitored on a quarterly basis including a visit from the appointed
Monitoring Officer. Anything outside of this will be discussed on a case by case basis.
• The monitoring will be carried out against a detailed project plan and financial forecast

68. Project Change Requests (PCR)
•We are unable to process any PCR’s before the Grant Offer Letter is issued
•If a member of your collaboration has failed UID and is unable to resolve you will be advised to
withdraw and apply into the next round of the competition
•PCR’s will only be agreed and authorised by Head of Operational Delivery

69. Contact us:
Customer Support Services: 0300 321 4357 (Mon-Fri, 9am-5:30pm)
support@innovateuk.ukri.org
Knowledge Transfer Network:
https://ktn-uk.co.uk/
Innovate UK:
https://www.gov.uk/government/organisations/innovate-uk
Q&A – Application process and finances

70. Any Questions?