The Energy Transition | Round up of energy innovation funding awards

This week we look at a range of energy funding announcements, the world's largest offshore wind farm exporting power for the first time, and Ofgem's approval of independent aggregators into the flexibility market.

Round up of energy innovation funding awards

Ofgem has awarded £16 million in funding to 36 network-led projects through its Strategic Innovation Fund (SIF) . The energy regulator first announced the SIF in September 2021, as a five-year programme with up to £450 million available to innovative energy projects.

The 36 projects have received  "alpha" funding during Round 2 of the SIF. The successful projects are focused around four Innovation Challenge areas:

• supporting a just energy transition;
• preparing for a net zero power system;
• improving energy system resilience and robustness; and
• accelerating decarbonisation of major energy demands.

The government has also announced that £89 million in funding has been awarded to 20 electric vehicle (EV) technology projects. The funding, backed by both government and industry sources, has been awarded through the Advanced Propulsion Centre UK, which aims to develop the back-to-back UK supply chain for zero emission vehicles. The government has stated that the funding will "help the UK lead the way on cutting edge net zero tech." The projects awarded funding include hydrogen-powered offroad vehicles, a new lithium scale-up plant and revolutionary new EV battery systems.

World's largest offshore wind farm starts exporting power

National Grid Electricity Distribution (NGED) has announced that the world's largest offshore wind farm has been connected to the grid for the first time. While not yet fully operational, Dogger Bank has undergone work to allow it to be connected to NGED's electricity transmission network and produce its first power.

Dogger Bank is being constructed by UK developer SSE Renewables in a joint venture with Norwegian energy companies Equinor and Vårgrønn. Construction of the North Sea wind farm has been broken into three 1.2GW phases: Dogger Bank A, B and C. Following the successful connection of Dogger Bank A into NGED's Creyke Beck substation last week, Dogger Bank B will also connect to Creyke Beck and Dogger Bank C will connect to NGED's Lackenby substation.

Dogger Bank is scheduled to complete in 2026. In its announcement on the latest milestone, SSE predicts that the wind farm's 3.6GW output will be enough to power 6 million homes with clean energy annually. It further estimates the yearly CO₂ savings delivered will equate to the removal of 1.5 million cars off the roads.

Ofgem approves independent aggregators to enter British wholesale flexibility market

Ofgem has approved plans to allow independent aggregators to participate in the wholesale flexibility market. The energy regulator has modified its Balancing and Settlement Code (BSC) P415 titled "Facilitating access to wholesale markets for flexibility dispatched by Virtual Lead Parties (VLPs)" to enable independent aggregators to access the market from 7 November 2024.

Ofgem anticipates that the modification will "lead to an increased amount of flexibility in the balancing market". It hopes that this will lead to greater participation from consumers who can adjust their demand or generation depending on the price in the wholesale electricity market. This concept, known as load shifting, allows demand and supply to be more closely matched which enhances energy use and reduces the restriction of generation.

The Ofgem panel considering the modification approved it unanimously.

Government opens £230m tranche of Public Sector Decarbonisation Scheme funding

The government has opened applications for £230 million of funding under the next phase of its Public Sector Decarbonisation Scheme. The aim of this scheme is to help public sector organisations such as schools and hospitals make significant low-carbon energy upgrades to their buildings. 

Under this phase, successful organisations will be able to spend the funds between the 2024 and 2025 financial years. Further funding will become available for the period between the 2025 and 2026 financial years. The government press release includes a range of suggested uses for the investment, from "heat pumps and solar panels, to new energy efficiency measures such as insulation and low-energy lighting".

Previous rounds of the scheme have so far allocated a total of over £2 billion of funding, with the most recent tranche dividing £409 million worth of investment across 114 public bodies in March 2023.

Ian Rodger, director of programmes at Salix, the non-departmental public body who will deliver this phase, stated the scheme is "empowering organisations across England to make significant reductions in their carbon footprint" and that the "enthusiasm for the scheme shows how much public sector bodies care about their carbon emissions".

This article was written with the assistance of Madeleine Begg, Luke Webb and Johnny Hartrick, Trainee Solicitors.