Ofgem Strategic Innovation Fund

Decarbonising Great Britain’s energy networks is a huge undertaking, and it is urgent. Innovation is critical to reaching this goal. The Ofgem Strategic Innovation Fund brings together the networks, the partners, the ideas and the people, to drive the innovation and transformation needed to accelerate the delivery of net zero by 2030.

Programmes

Transitioning the UK’s energy networks towards a resilient and efficient future.

Delivered in partnership between Ofgem and Innovate UK, the Ofgem Strategic Innovation Fund (SIF) is a £1 billion programme, making it the largest energy network innovation fund in the UK.
The SIF was established in 2021 as a five-year, £450 million programme, part of the RIIO-2 price control system managed by industry regulator Ofgem.

For the RIIO-3 price control period, from April 2026 to March 2031, Ofgem has allocated an additional £500 million to the SIF. This includes a £50 million Deployment Phase, to support the transition of proven innovations into operational deployment across the GB energy system.

The SIF supports the acceleration of transformational whole energy system innovation to address climate change and ensure value for money for people who use and pay for Britain’s energy networks.

The SIF works with other public funders of innovation so that activities appropriately funded by network consumers are coordinated with activities funded by Government. Key sectors include Agriculture, AI, Built environment, Digital, Energy, Energy efficiency, Fuel poverty, Net zero, Retrofit, Sustainability, Transport, Water.

RIIO-3 (Revenues = Incentives + Innovation + Outputs) is the third generation of Ofgem’s framework and price controls to ensure that the monopoly companies operating the UK’s gas and electricity networks have sufficient revenue to run and invest in networks that efficiently deliver what customers value.

Game changing innovations

The journey to decarbonising Great Britain's energy networks is a huge undertaking. It requires game changing innovations led by the most ambitious energy innovators around. And for the last few years Ofgem Strategic Innovation Fund has been doing just that.

Vision and mission

Accelerating the UK’s transition to Net Zero at lowest cost to the consumer and make the UK the best place for energy businesses to grow and scale.

Helping people

We create products and services to transition energy networks to net zero, ensuring value for money for consumers. We aim to empower people in businesses and communities.

Helping the planet

We are accelerating the delivery of net zero goals while enabling energy security. Our efforts focus on making energy systems more resilient and robust.

Helping business

We enable diverse collaboration to drive change and support the best ideas to grow and scale, encouraging finance and investment to foster innovation.

The process

The SIF programme has been designed to aid your energy innovation journey and help grow and scale successful businesses to deployment. We support the very best transformational ideas contributing to Britain’s economic growth as they accelerate the decarbonisation of Britain’s energy networks to achieve net zero objectives. To find out more, watch our Innovate UK Ofgem Strategic Innovation Fund (SIF) – application process animation on YouTube.

RIIO-3
Challenges
Delivery
Deployment
Funding

The Energy Network Innovation Taskforce

The first step of the programmatic approach for the RIIO-3 spending control period was the formation of the Energy Network Innovation Taskforce, announced in October 2025.

The Taskforce united senior leaders from across the energy networks ecosystem, and beyond, to define bold, long-term customer-centred and outcome focused Innovation Challenges for the Strategic Innovation Fund (SIF).

The Challenges defined by the Taskforce were published on 13 May 2026 – see Challenges tab for more detail.
These transformational Innovation Challenges are fundamental to building a smarter, more resilient, and affordable net zero energy system – and critically, one that is consumer centric and unlocks economic growth and prosperity.

Taskforce Steering Group Terms of Reference

The RIIO-3 Innovation Challenges

The Challenges defined by the Taskforce will remain open for SIF applications for the next 5 years.

Read the Energy Network Innovation Taskforce report to find out more detail about the Innovation Challenges: Networks Reimagined: Driving innovation for a future energy system

Challenge 1: Industrial and business connection acceleration

Major new strategic industrial sites can be energised and operational within six months by 2033

Challenge 2: Faster build and maintenance

50% faster, 20% cheaper network build and maintenance by 2035

Challenge 3: Instant use domestic energy devices

Enable instant, plug-and-play connections of domestic energy devices and appliances by 2032

Challenge 4: Eliminating energy outages

Near-zero interruptions via autonomous reconfiguring and islanding of any section of the network by 2038

Challenge 5: Decentralised system balancing

Deliver products and services to prove the viability of autonomous local balancing and optimisation of networks at every level by 2034

Innovation Delivery Groups

The second stage of the programmatic approach is the introduction of Innovation Delivery Groups (IDGs), to provide a collaboration framework across networks for addressing the innovation challenges.

Each IDG will focus on one of the Innovation challenges, bringing together a cohort of industry experts to monitor progress against Innovation Challenge outcomes.

This provision of ongoing expert input will ensure accountability to deliver outcomes that reflect customer needs alongside economic growth through:

Coordination between stakeholders
Continuous learning
Identification of remaining innovation gaps
Collective deployment

To find out more and engage with IDGs, complete our EoI form – SIF Expression of Interest (for IDGs participation)

Deployment Phase

New dedicated Deployment Phase funding has been allocated to the SIF in RIIO-3 to support the transition of proven innovations into operational deployment across the GB energy system.

The SIF supports a broad range of project types. Some projects provide learnings about the fundamental benefits of technologies or materials, others create deployable products and services.

Monitoring our active Beta projects and evaluating against a framework of criteria, allows us to support identification of challenges and taking early action to avoid or mitigate these blockers.

Starting from £500k, Deployment Phase funding will support deployment of projects that licensees are not already incentivised to deploy through existing incentives. Innovations can come from previous SIF phases, Network Innovation Allowance or Network Innovation Competition projects.

We also monitor the progress of SMEs that are involved in the SIF portfolio, by maintaining a close relationship and monitoring their development we can support directly, or through our IUK partners like IUK Business Connect.

Application process

Project teams, led by energy networks, apply for funding against Innovation Challenges through the SIF’s regular funding competition process.

Competitions are open three times a year, giving more opportunities and greater flexibility for project teams to apply for funding and advance through the phases. Competitions open in:

January
May
September

Applications are submitted by the lead network via the Innovation Funding Service portal.

Successfully funded projects begin a journey across the SIF phases:

Discovery: many projects, feasibility studies lasting up to 5 months, up to £200k
Alpha: fewer projects, proof of concept, lasting up to 8 months, up to £650k per project
Beta: a few projects, large-scale, real-world demonstrator developments lasting up to 5 years, multimillion-pound funding
Deployment: to support the transition of proven innovations into operational deployment, funding starts at 500k

Funding cycles and dates

Every year, three cycles will be open for opportunities to apply into the available rounds of the SIF. The cycles will open in January, May and September and close in February, June and October. All three phases (Discovery, Alpha and Beta) will be available for applications within each cycle. View current open opportunities.

Projects that address the Round 4 innovation challenges must be in Beta stage to apply.

Projects that address the Round 5 innovation challenges can be in:
- Discovery
- Alpha
- Beta
Projects that address the Strategic Innovation Fund Challenges: 2026 to 2033 can be in:
- Discovery
- Alpha
- Beta
Any eligible licensee within RIIO-3 that has previously received funding through the Network Innovation Allowance (NIA), the Network Innovation Competition (NIC), SIF, or equivalent innovation mechanisms can apply to the SIF Deployment phase.
Projects that address the Round 4 innovation challenges must be in Beta stage to apply.

Projects that address the Round 5 innovation challenges can be in:
- Discovery
- Alpha
- Beta
Projects that address the Round 5 innovation challenges can be in:
- Alpha
- Beta