Funding competition Unlocking nature positive private investment

UK registered businesses can apply for a share of up to £2 million for developing solutions that enable private investors to invest in nature positive projects. This funding is from Innovate UK.

Competition opens: Monday 12 February 2024
Competition closes: Wednesday 10 April 2024 11:00am

This competition is now closed.

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Description

Innovate UK, part of UK Research and Innovation (UKRI), will invest up to £2 million in supporting innovation projects. These innovation projects will develop solutions that enable private investors to invest in nature positive projects.

This funding is from Innovate UK and is part of a £7 million Integrating Finance and Biodiversity for a Nature Positive Future (IFB) programme led by Natural Environment Research Council (NERC).

The aim of this competition is to mobilise significant private investment to scale nature positive solutions. The competition will enable the development, acceleration and commercialisation of innovative solutions. These solutions must enable private investors to confidently invest in nature positive projects.

Your project must focus on one or more of the following themes:

data, tools, models and metrics, including decision making tools
environmental monitoring and verification of investments, over time, cost effectively
insurance or insurability of projects
solutions that help aggregate projects to attract finance

Your project must address and overcome, previously identified barriers to private investment in nature, including but not limited to:

limited sources of revenue from nature to fund investment
high-transaction costs and significant disincentives for investment in nature based projects
insufficient certainty to price long term risk, due to a lack of standards and accreditation
limited project pipeline and scale and an under-developed supply chain

In applying to this competition, you are entering into a competitive process. This competition has a funding limit, so we may not be able to fund all the proposed projects. It may be the case that your project scores highly but we are still unable to fund it.

This competition closes at 11am UK time on the deadline stated in this Innovate UK competition brief. We cannot guarantee other government or third party sites will always show the correct competition information.

Funding type

Grant

Project size

Your project’s total grant funding request must be between £250,000 and £500,000.

Accessibility and Inclusion

We welcome and encourage applications from people of all backgrounds and are committed to making our application process accessible to everyone. This includes making reasonable adjustments, for people who have a disability or a long-term condition and face barriers applying to us.

You can contact us at any time to ask for guidance.

We recommend you contact us at least 15 working days before this competition’s closing date to allow us to put the most suitable support in place. The support we can provide may be limited if you contact us close to the competition deadline.

You can contact Innovate UK by email or call 0300 321 4357. Our phone lines are open from 9am to 12pm and 2pm to 5pm UK time, Monday to Friday (excluding bank holidays).

Who can apply

Your project

Your project must:

have a grant funding request of between £250,000 and £500,000
last up to 9 months
carry out all of its project work in the UK
intend to exploit the results from or in the UK
start on 1 September 2024
end by 30 May 2025

Projects must always start on the first of the month and this must be stated within your application. Your project start date will be reflected in your grant offer letter if you are successful.

You must only include eligible project costs in your application.

Under current restrictions, this competition will not fund any procurement, commercial, business development or supply chain activity with any Russian or Belarusian entity as lead, partner or subcontractor. This includes any goods or services originating from a Russian or Belarusian source.

Lead organisation

To lead a project or work alone your organisation:

must be a UK registered business of any size
be or involve at least one grant claiming micro, small or medium-sized enterprise (SME)
can collaborate with other UK registered organisations

More information on the different types of organisation can be found in our Funding rules.

Academic institutions cannot lead or work alone.

Project team

To collaborate with the lead, your organisation must be one of the following UK registered:

business of any size
academic institution
charity
not for profit
public sector organisation
research and technology organisation (RTO)

All project teams must have as a lead or grant claiming partner, at least one grant claiming micro, small or medium-sized enterprise (SME).

Each partner organisation must be invited into the Innovation Funding Service (IFS) by the lead to collaborate on a project. Once partners have accepted the invitation, they will be asked to login or to create an account in IFS. They are responsible for entering their own project costs and completing their Project Impact questions in the application.

To be an eligible collaboration, the lead and at least one other organisation must apply for funding when entering their costs into the application.

Non-funded partners

Your project can include partners that do not receive any of this competition’s funding, for example non-UK businesses. Their costs will count towards the total project costs.

Subcontractors

Subcontractors are allowed in this competition.

Subcontractors can be from anywhere in the UK and you must select them through your usual procurement process.

You can use subcontractors from overseas but must make the case in your application as to why you could not use suppliers from the UK.

You must provide a detailed rationale, evidence of the potential UK contractors you approached and the reasons why they were unable to work with you. We will not accept a cheaper cost as a sufficient reason to use an overseas subcontractor.

All subcontractor costs must be justified and appropriate to the total project costs.

Number of applications

A business can only lead on one application but can be included as a collaborator in two further applications.

If a business is not leading any application, it can collaborate in any number of applications.

All other organisations can collaborate on any number of applications.

Use of animals in research and innovation

Innovate UK expects and supports the provision and safeguarding of welfare standards for animals used in research and innovation, according to best practice and up to date guidance.

Applicants must ensure that all of the proposed work within projects, both that in the UK and internationally, will comply with the UKRI guidance on the use of animals in research and innovation.

Any projects selected for funding which involve animals will be asked to provide additional information on welfare and ethical considerations, as well as compliance with any relevant legislation as part of the project start-up process. This information will be reviewed before an award is made.

Previous applications

You can use a previously submitted application to apply for this competition.

You can make a maximum of two submissions to Innovate UK with any given proposal. If Innovate UK judges that your proposal is not materially different from your previous proposal, it will be counted towards this maximum.

If your application goes through to assessment and is unsuccessful, you can reapply with the same proposal once more.

We will not award you funding if you have:

failed to exploit a previously funded project
an overdue independent accountant’s report
failed to comply with grant terms and conditions

Subsidy control (and State aid where applicable)

This competition provides funding in line with the Subsidy Control Act 2022. Further information about the Subsidy requirements can be found within the Subsidy Control Act 2022 (legislation.gov.uk).

Innovate UK is unable to award organisations that are considered to be in financial difficulty. We will conduct financial viability and eligibility tests to confirm this is not the case following the application stage.

EU State aid rules now only apply in limited circumstances. Please see the Windsor Framework to check if these rules apply to your organisation.

Further Information

If you are unsure about your obligations under the Subsidy Control Act 2022 or the State aid rules, you should take independent legal advice. We are unable to advise on individual eligibility or legal obligations.

You must always make sure that the funding awarded to you is compliant with all current Subsidy Control legislation applicable in the United Kingdom.

This aims to regulate any advantage granted by a public sector body which threatens to, or actually distorts competition in the United Kingdom or any other country or countries.

Funding

Up to £2 million has been allocated to fund innovation projects in this competition. Funding will be in the form of a grant.

If your organisation’s work on the project is commercial or economic, your funding request must not exceed the limits below. These limits apply even if your organisation normally acts non-economically but for the purpose of this project will be undertaking commercial or economic activity.

The balance between your total project costs and the amount of grant awarded must be funded by the organisation receiving the grant.

For feasibility studies and industrial research projects, you could get funding for your eligible project costs of:

up to 70% if you are a micro or small organisation
up to 60% if you are a medium sized organisation
up to 50% if you are a large organisation

For experimental development projects which are nearer to market, you could get funding for your eligible project costs of:

up to 45% if you are a micro or small organisation
up to 35% if you are a medium sized organisation
up to 25% if you are a large organisation

For more information on company sizes, please refer to the company accounts guidance.

If you are applying for an award funded under State aid Regulations, the definitions are set out in the European Commission Recommendation of 6 May 2003.

Research participation

The research organisations undertaking non-economic activity as part of the project can share up to 20% of the total eligible project costs. If your consortium contains more than one research organisation undertaking non-economic activity, this maximum is shared between them. Of that 20% you could get funding for your eligible project costs of up to:

80% of full economic costs (FEC) if you are a Je-S registered institution such as an academic
100% of your project costs if you are an RTO, charity, not for profit organisation, public sector organisation or research organisation

Your proposal

The aim of the Integrating Finance and Biodiversity for a Nature Positive Future (IFB) programme, is to understand the complex links between biodiversity, finance and society.

The IFB programme will explore the gaps and integration between the financial system and biodiversity, with the aim of improving the integration of biodiversity into financial decision-making, frameworks, reporting and planning.

Your project must support the scaling of nature positive solutions, by enabling biodiversity-related risks and opportunities to be incorporated into planning, reporting and investment decisions for the finance and business sectors.

Your project must address and overcome previously identified barriers to private investment in nature, including but not limited to:

limited sources of revenue from nature to fund investment
high-transaction costs and significant disincentives for investment in nature-based projects
insufficient certainty to price long term risk, due to a lack of standards and accreditation
limited project pipeline and scale and an under-developed supply chain

Your project must consider factors that are important in the context of nature and biodiversity, including but not limited to:

wider impacts including climate adaptation and resilience
impact on people including indigenous communities
removing barriers to adoption of solutions including, for example, trust, authenticity and traceability of the data, and lack of data expertise

Your project must:

provide a strong case for why your proposed solution will be in demand from end users
demonstrate how the proposed solution would enable end users to invest in nature positive solutions
provide a plan for how to engage end users, for example, financial institutions and investors in its development

Your project can involve at least one end user, for example, a financial institution. They are not required to be a grant claiming participant.

Projects funded through this competition will be expected to engage with other related initiatives and their partners. See the Further information section for more details.

Your project can build upon the outcomes of the research projects supported through Natural Environment Research Council (NERC) funded IFB phase 1 activity. This is not compulsory.

Portfolio approach

We want to fund a variety of projects across different strands or themes. We call this a portfolio approach.

Specific themes

Your project must focus on one or more of the following themes:

data, tools, models and metrics, including decision making tools
environmental monitoring and verification of investments, over time, cost effectively
insurance or insurability of projects
solutions that help aggregate projects to attract finance

Research categories

We will fund feasibility projects, industrial research projects and experimental development projects, as defined in the guidance on categories of research.

Projects we will not fund

We are not funding projects that directly deliver nature positive solutions.

We cannot fund projects that are:

dependent on export performance, for example, giving a subsidy to a baker on the condition that it exports a certain quantity of bread to another country
dependent on domestic inputs usage, for example, giving a subsidy to a baker on the condition that it uses 50% UK flour in their product

12 February 2024: Competition opens
23 February 2024: Webinar briefing event: watch the recording
7 March 2024: Collaboration event: register to attend
10 April 2024 11:00am: Competition closes
5 June 2024: Applicants notified

Before you start

You must read the guidance on applying for a competition on the Innovation Funding Service before you start.

Before submitting, it is the lead applicant’s responsibility to make sure:

that all the information provided in the application is correct
your proposal meets the eligibility and scope criteria
all sections of the application are marked as complete
if collaborative, that all partners have completed all assigned sections and accepted the terms and conditions (T&Cs)

You can reopen your application once submitted, up until the competition deadline. You must resubmit the application before the competition deadline.

What we ask you

The application is split into four sections:

Project details.
Application questions.
Finances.
Project Impact.

Accessibility and Inclusion

You can contact us at any time to ask for guidance.

You can contact Innovate UK by email or call 0300 321 4357. Our phone lines are open from 9am to 12pm and 2pm to 5pm UK time, Monday to Friday (excluding bank holidays).

1. Project details

This section provides background for your application and is not scored.

Application team

Decide which organisations will work with you on your project and invite people from those organisations to help complete the application.

Application details

Give your project’s title, start date and duration.

Research category

Select the type of research you will undertake.

Project summary

Describe your project briefly and be clear about what makes it innovative. We use this section to assign the right experts to assess your application.

Your answer can be up to 400 words long.

Public description

Describe your project in detail and in a way that you are happy to see published. Do not include any commercially sensitive information. If we award your project funding, we will publish this description. This could happen before you start your project.

Your answer can be up to 400 words long.

Scope

Describe how your project fits the scope of the competition. If your project is not in scope, it will not be sent for assessment. We will tell you the reason why.

Your answer can be up to 400 words long.

2. Application questions

The assessors will score all your answers apart from question 1, 2 and 3. You will receive feedback for each scored question. Find out more about how our assessors assess and how we select applications for funding.

You must answer all questions. Your answer to each question can be up to 400 words long. Do not include any website addresses (URLs) in your answers.

Question 1. Applicant location (not scored)

You must state the name and full registered address of your organisation and any partners or subcontractors working on your project.

We are collecting this information to understand the geographical location of all applicants.

Question 2. Animal testing (not scored)

Will your project involve any trials with animals or animal testing?

You must select one option:

We will only support innovation projects conducted to the highest standards of animal welfare.

Further information for proposals involving animal testing is available at the UKRI Good Research Hub and NC3R’s animal welfare guidance.

Question 3. Permits, licences and data access agreements (not scored)

Will you have the correct permits, licences and data access agreements in place to carry out your project?

We are unable to fund projects who do not have the correct permits, licences or data access agreements in place by your project start date.

You must select one option:

Yes
No
In process of being applied for
Not applicable

Question 4. Need or challenge

What is the business need, technological challenge, or market opportunity behind your innovation?

Explain:

the main motivation for the project
the business need, technological challenge or market opportunity
why your proposed solution will be in demand from end users
whether you have identified any similar innovation and its current limitations, including those close to market or in development
any work you have already done to respond to this need, for example, if the project focuses on developing an existing capability or building a new one
the wider economic, social, environmental, cultural or political challenges which are influential in creating the opportunity, such as incoming regulations

Question 5. Approach and innovation

What approach will you take and where will the focus of the innovation be?

Explain:

how you will respond to the need, challenge or opportunity identified
how you will improve on any similar innovation that you have identified
whether the innovation will focus on existing technologies in new areas, the development of new technologies for existing areas, or a totally disruptive approach
the freedom you have to operate
how this project fits with your current product, service lines or offerings
how it will make you more competitive
the nature of the outputs you expect from the project, for example, reports, demonstrator, know-how, new process, product or service design, and how these will help you to target the need, challenge or opportunity identified

You can submit one appendix to support your answer. It can include diagrams and charts. It must be a PDF, up to 2 A4 pages long and no larger than 10MB in size. The font must be legible at 100% zoom.

Question 6. Team and resources

Who is in the project team and what are their roles?

Explain:

the roles, skills and experience of all members of the project team that are relevant to the approach you will be taking
the resources, equipment and facilities needed for the project and how you will access them
the details of any vital external parties, including subcontractors, who you will need to work with to successfully carry out the project
if your project is collaborative, the current relationships between project partners and how these will change as a result of the project
any roles you will need to recruit for

You can submit one appendix, with a short summary of the main people working on the project to support your answer. It must be a PDF, up to 4 A4 pages long and no larger than 10MB in size. The font must be legible at 100% zoom.

Question 7. Market awareness

What does the market or markets you are targeting look like?

Describe:

the target markets for the project outcomes and any other potential markets, either domestic, international or both
the size of the target markets for the project outcomes, backed up by references where available
the structure and dynamics of the target markets, including customer segmentation, together with predicted growth rates within clear timeframes
the target markets’ main supply or value chains and business models, and any barriers to entry that exist
the current UK position in targeting these markets
the size and main features of any other markets not already listed

If your project is highly innovative, where the market may be unexplored, describe or explain:

what the market’s size might be
how your project will try to explore the market’s potential

Question 8. Outcomes and route to market

How are you going to grow your business and increase long term productivity as a result of the project?

Explain:

your current position in the markets and supply or value chains outlined, and whether you will be extending or establishing your market position
your target customers or end users, and the value to them, for example, why they would use or buy your product
your route to market, including commitments from identified customers or partners
how you are going to profit from the innovation, including increased revenues or cost reduction
how the innovation will affect your productivity and growth, in both the short and the long term
how you will protect and exploit the outputs of the project, for example, through know-how, patenting, designs or changes to your business model
your strategy for targeting the other markets you have identified during or after the project

If there is any research organisation activity in the project, describe:

your plans to spread the project’s research outputs over a reasonable timescale
how you expect to use the results generated from the project in further research activities

Question 9. Wider impacts

What impact might this project have outside the project team?

Describe and, where possible, measure the economic benefits from the project such as productivity increases and import substitution, to:

external parties
customers
others in the supply chain
broader industry
the UK economy

Describe and, where possible, measure:

any expected impact on government priorities
any expected environmental impacts, either positive or negative
any expected regional impacts of the project

Describe any expected social impacts, either positive or negative, on, for example:

quality of life
social inclusion or exclusion
jobs, such as safeguarding, creating, changing or displacing them
education
public empowerment
health and safety
regulations
diversity

Question 10. Project management

How will you manage your project effectively?

Explain:

the main work packages of your project, indicating the lead partner assigned to each and the total cost of each one
your approach to project management, identifying any major tools and mechanisms you will use to get a successful and innovative project outcome
the management reporting lines
your project plan in enough detail to identify any links or dependencies between work packages or milestones

You must submit a project plan or Gantt chart as an appendix to support your answer. It must be a PDF, up to 2 A4 pages long and no larger than 10MB in size. The font must be legible at 100% zoom.

Question 11. Risks

What are the main risks for this project?

Explain:

the main risks and uncertainties of the project, including the technical, commercial, managerial and environmental risks
how you will mitigate these risks
any project inputs that are critical to completion, such as resources, expertise, and data sets
any output likely to be subject to regulatory requirements, certification, ethical issues and other requirements identified, and how you will manage this

You must submit a risk register as an appendix to support your answer. It must be a PDF, up to 2 A4 pages long, and no larger than 10MB in size. The font must be legible at 100% zoom.

Question 12. Added value

How will this public funding help you to accelerate or enhance your approach to developing your project towards commercialisation? What impact would this award have on the organisations involved?

Explain:

what advantages public funding would offer your project, for example: appeal to investors, more partners, reduced risk or a faster route to market
the likely impact of the project outcomes on the organisations involved
what other routes of investment or means of support you have already engaged with and why they were not suitable
how any existing or potential investment or support will be used in conjunction with the grant funding
what your project would look like without public funding
how this project would change the R&D activities of all the organisations involved

Question 13. Costs and value for money

How much will the project cost and how does it represent value for money for the team and the taxpayer?

In terms of your project goals, explain:

your total project costs
the grant you are requesting
how each partner will finance their contributions to your project
how this project represents value for money for you and the taxpayer
how it compares to what you would spend your money on otherwise
the balance of costs and grant across the project partners
any subcontractor costs and why they are critical to your project

3. Finances

Each organisation in your project must complete their own project costs, organisation details and funding details in the application. Academic institutions must complete and upload a Je-S form.

For full details on what costs you can claim see our project costs guidance. You can also view our Application Finances video.

4. Project Impact

This section is not scored but will provide background to your project.

Each partner must complete the Project Impact questions before being able to submit the application.

More information can be found in our Project Impact guidance and by viewing our Impact Management Framework video.

Background and further information

Natural Environment Research Council (NERC) is leading the UKRI Integrating Finance and Biodiversity for a Nature Positive Future (IFB) programme. The IFB programme aims to:

understand the complex interlinkages between biodiversity, finance and society; create sustainable financial models, integrate biodiversity into financial instruments, enhance UK leadership, and address concurrent stressors to achieve net environmental gain
build a national multi-stakeholder community that can drive the development of knowledge, tools and skills to incorporate biodiversity-related risks and opportunities into planning, reporting and investment decisions for the finance and business sectors

The IFB programme is made up of two elements:

a NERC-led funding opportunity supporting research-led activity
this Innovate UK-led funding opportunity supporting business-led activity

Projects funded through this Innovate UK competition will be expected to engage as a cohort, and to interact with related initiatives and their partners, for example:

the NERC funded components of the IFB programme, including aligning with core programme activities and themes led by the coordination hub
the NERC and Innovate UK Climate and environmental risk analytics for resilient finance (CERAF) programme, including the UK Centre for Greening Finance and Investment (UKCGFI), which is developing a platform for climate and environmental analytics for resilient finance.

Projects will be encouraged to contribute to market-wide engagement and capacity building activities organised by these respective programmes to upskill financial institutions and businesses.

Further information can be found:

Integrating finance and biodiversity for a nature positive future – UKRI

Integrating Finance and Biodiversity | Nature positive future (infinbio.org)

New research will integrate biodiversity and finance – UKRI

Embedding climate and biodiversity in finance with NERC-funded research – UKRI

Data sharing

This competition is funded by Innovate UK as part of a UKRI programme led by the Natural Environment Research Council (NERC) (each an ‘agency’).

Any relevant information submitted and produced during the application process concerning your application can be shared by one agency with the other, for its individual storage, processing and use.

This means that any information given to or generated by Innovate UK in respect of your application may be passed on to NERC and vice versa. This would include, but is not restricted to:

the information stated on the application, including the personal details of all applicants
scoring and feedback on the application
information received during the management and administration of the grant, such as Monitoring Officer reports and Independent Accountant Reports

Innovate UK and NERC are directly accountable to you for their holding and processing of your information, including any personal data and confidential information. Data is held in accordance with their own policies. Accordingly, Innovate UK, and NERC will be data controllers for personal data submitted during the application.

Innovate UK’s Privacy Policy

NERC’s Privacy Policy

Innovate UK complies with the requirements of UK GDPR and the Data Protection Act 2018, and is committed to upholding data protection legislation, and protecting your information in accordance with data protection principles.

The Information Commissioner’s Office also has a useful guide for organisations, which outlines the data protection principles.

Find a project partner

If you want help to find a project partner, contact Innovate UK Business Connect.

Support for SMEs from Innovate UK Business Growth

If you receive an award, you will be contacted about working with an innovation and growth specialist at Innovate UK Business Growth. This service forms part of our funded offer to you.

These specialists focus on growing innovative businesses and ensuring that projects contribute to their growth. Working one-to-one, they can help you to identify your best strategy and harness world-class resources to grow and achieve scale.

We encourage you to engage with Innovate UK Business Growth, delivered by a knowledgeable and objective specialist near you.

Assessment

Your application will be reviewed by up to three independent assessors based on the content of your application and their skills or expertise relevant to your project. All of the scores awarded will count towards the total score used to make the funding decision unless you are notified otherwise.

You can find out more about our assessment process in the General Guidance.

Your submitted application will be assessed against these criteria.

Unlocking nature positive private investment - assessor guidance for applicants.pdf (opens in a new window)

Next steps

If you are successful with this application, you will be asked to set up your project.

You must follow the unique link embedded in your email notification. This takes you to your Innovation Funding Service (IFS) Set Up portal, the tool that Innovate UK uses to gather necessary information before we can allow your project to begin.

You will need to provide:

the name and contact details of your project manager and project finance lead
a redacted copy of your bank details
a collaboration agreement
an exploitation plan

In order for us to process your claims, you must make sure you have a valid UK business bank account. It can take several weeks for a new account to be created if required. We recommend starting this process as early as possible to avoid any delays to your project start date.

The bank account which grant is to be paid into must:

be a business account in the same name as the organisation listed in IFS
be from a UK bank regulated by the Prudential Regulation Authority (PRA)
have a cheque and credit clearing facility

Online accounts are eligible as long as they meet the above criteria.

Innovate UK will accept most banking societies apart from:

Viva Wallet
Intesa Sanpaolo
Equals Money UK Limited

If you have any doubts that your bank account will not meet Innovate UK's funding criteria, you can use the sort code checker. If you input the sort code and find a tick next to the ‘BACS Direct Credit payments can be sent to this sort code’, this will give you an indication that the bank account you hold is acceptable.

Finance checks

We will carry out checks to make sure you are an established company with access to the funds necessary to complete the project.

You must check your IFS portal regularly and respond to any requests we have sent for additional information to avoid any delays.

Failure to complete project setup may result in your grant offer being withdrawn.

Your Grant offer letter (GOL)

Once you have successfully completed project setup, we will issue your GOL.

The GOL will be made available on your IFS portal. You will need to sign and upload this for us to approve. Once approved we will send you an email with permission to start your project on your confirmed start date.

You must not start your project before the date stated on your email and GOL. Any costs incurred before your agreed start date cannot be claimed as part of your grant.

If your GOL is approved on or before the fifteenth of the month it will be dated from the first of that month. If your GOL is approved after the fifteenth, it will be dated the first of the next month.

If your application is unsuccessful

If you are unsuccessful with your application this time, you can view feedback from the assessors. This will be available to you on your IFS portal following notification.

Sometimes your application will have scored well, and you will receive positive comments from the assessors. You may be unsuccessful as your average score was not above the funding threshold or your project has not been selected under the portfolio approach if this is applied for this competition.

Contact us

If you need more information about how to apply or you want to submit your application in Welsh, email support@iuk.ukri.org or call 0300 321 4357.

Our phone lines are open from 9am to 12pm and 2pm to 5pm UK time, Monday to Friday (excluding bank holidays).

Need help with this service? Contact us