Smart energy systems to benefit from £725m industrial strategy fund

28 November 2017

Smart energy systems will receive a slice of a new £725m industrial strategy challenge fund, according to a white paper which was unveiled today.

Clean growth is identified as one of the four ‘grand challenges’ in the industrial strategy white paper, published by the department for business, energy and industrial strategy (BEIS).

The white paper states that a programme to develop smart systems, entitled ‘Prospering from the energy revolution’, has been earmarked for support from wave two of the £725m industrial strategy challenge fund.

It will include the launch of a programme to support the development of local smart energy systems capable of delivering ‘cheaper and cleaner energy across power, heating and transport’.

The wave two programmes are subject to final approval when their business cases have been approved.

The challenge fund’s first wave included support for the Faraday Battery Challenge

The white paper says the strategy’s long-term goals include ensuring that ‘clean’ technologies are cheaper than high carbon alternatives.

It also announces £20m worth of seedcorn support for a new equity fund that will provide patient capital to ‘strengthen’ support for the commercialisation of new clean technologies. 

And the strategy outlines further support for accelerating the drive towards greater uptake of electric vehicles.

This includes a commitment that 25 per cent of the cars in central government department fleets should be electric by 2022, and the rollout of new building regulations making it compulsory for all new residential developments to contain enabling cabling for charge-points.

The white paper also says that the government is in ‘advanced discussions’ with the nuclear industry on a sector deal that covers the supply chain, nuclear R&D and skills.

It says the goal of the deal is to achieve cost reductions across the UK’s nuclear new build and decommissioning programmes.

The first four sector deals were unveiled in the white paper today with announcements on discussions about agreements with further industries due to be made in the New Year.

Responding to the update of the industrial strategy, Hugh McNeal, chief executive of RenewableUK expressed disappointment that it contained no support for onshore wind.

He said: “Renewables are set to become the backbone of our modern energy system and the plummeting cost of wind power means onshore and offshore wind can help improve the competitiveness of UK industry. So it’s disappointing that the strategy doesn’t set out how we can use onshore wind, the cheapest new generation source, to power industrial growth.”

A spokesperson for SSE said: “The white paper’s focus on developing new infrastructure and ambitious sector deals for offshore wind, attracting green finance, charging points for electric vehicles and 5G connectivity across the UK suggests further opportunities for SSE.”

Lord Hutton, chairman of the Nuclear Industry Association and co-chair of the Nuclear Industry Council, said: “Industry has made significant progress with government towards agreeing a sector deal which will maximise those opportunities and help improve productivity, foster innovation and reduce cost.”

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