Funding competition ISCF Decarbonisation of industrial clusters phase 2: deployment

UK registered organisations can apply for a share of up to £131 million to implement plans for decarbonising an industrial cluster. This funding is from the Industrial Strategy Challenge Fund (ISCF).

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Competition sections

Description

Innovate UK, part of UK Research and Innovation, will invest up to £131 million for collaborative projects to enable industrial cluster decarbonisation as part of the ISCF Industrial Decarbonisation Challenge Fund. These projects are expected to support delivery of significant emissions reduction in at least one UK industrial cluster by 2030, in line with the BEIS Industrial Clusters Mission.

This is the second phase of a 2-phase competition.

You must have been successful at phase 1 to be eligible for phase 2. We will accept changes in the consortium or costs for phase 2, but only if you have justified them.

The funding will be allocated on a portfolio basis.

We are also running a separate Cluster Plan competition, which is focused on delivering a reduction in CO2 emissions in industrial clusters. You can submit a proposal into both competitions.

The competition closes at 11am UK time on the deadline stated.

Funding type

Grant

Project size

You can request grant funding of between £10 million and £20 million.

Who can apply

State aid

Any UK registered organisation claiming grant funding must be eligible to receive state aid at the time we confirm you will be awarded funding. It is not possible to award grant funding to organisations meeting the condition known as undertakings in difficulty. If you are unsure please take legal advice. For further information see our general guidance on state aid. You will need to demonstrate within your application how you will be compliant with State aid regulations.

Your project

Your project must:

  • have been successful at phase 1
  • have been invited to apply to phase 2 by Innovate UK
  • have total grant costs of between £10 million and £20 million
  • comply with state aid rules
  • be collaborative
  • start by 1 March 2021
  • end no later than 31 March 2024

If your project’s total eligible costs or duration falls outside of our eligibility criteria, you must provide justification by email to support@innovateuk.ukri.org at least 30 working days before the competition closes. We will decide whether to approve your request.

If your project team and/or proposed scope differs from that in phase 1, you must provide justification by email to support@innovateuk.ukri.org at least 50 days before the competition closes. We will decide whether to approve your request.

Lead organisation

To lead a project your organisation must:

Academic institutions, research organisations and public sector organisations or charities cannot lead or work alone.

Project team

To collaborate with the lead organisation your organisation must:

  • be a UK registered business of any size, academic institution, research organisation, charity, or public sector organisation
  • carry out its project work in the UK
  • intend to exploit the results from or in the UK
  • be invited by the lead organisation

Each partner organisation must be invited into the Innovation Funding Service by the lead to collaborate on a project. Partners must enter their own project costs into the Innovation Funding Service.

The lead organisation and at least one other organisation must claim funding.

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 eligible project costs.

Subcontractors

Subcontractors are allowed in this competition. Subcontractors can be from anywhere in the UK or if justifiable the European Economic Area. We expect subcontractor costs to be justified and appropriate to the total eligible project costs.

Multiple applications

Any UK registered business can lead on any number of project applications and collaborate in any number of further applications in this competition strand. Multiple applications from the same lead organisation must be materially different from each other in scope and associated cost to be assessed.

Public sector organisations, charities, research organisations and academic institutions can collaborate in any number of applications.

You can also submit a separate application to the cluster plan competition.

Previous applications

Resubmissions

You cannot use a resubmission to apply for this competition.

Failure to exploit

If you applied to a previous competition as the lead or sole organisation and were awarded funding by Innovate UK or UK Research and Innovation, but did not make a substantial effort to exploit that award, we will award no more funding to you, in this or any other competition. You will not be able to contest our decision. We will:

  • assess your efforts in the previous competition against your exploitation plan for that project
  • review the monitoring officers’ reports and any other relevant sources for evidence
  • document our decision, which will be made by 3 team members, and communicate it to you in writing

Previous projects

Under the terms of Innovate UK funding, you are required to submit an independent accountant’s report (IAR) with your final claim. If you or any organisation in your consortium failed to submit an IAR on a previous project, we will not award funding to you in this or any other competition until we have received the documents.

Funding

We have allocated up to £131 million to fund innovation projects in phase 2 of this competition.

If your organisation’s work on the project is mostly commercial or economic, your funding request must not exceed the limits below. These limits apply even if your organisation normally acts non-economically.

These projects are categorised as Industrial Research projects, therefore you could receive 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

The academic, research and public sector organisations acting non-economically in your consortium can share up to 30% of the total eligible project costs. If your consortium contains more than one research organisation or public sector organisation, this maximum is shared between them.

This competition provides state aid funding under article 25, ‘Aid for Research and Development projects’, of the General Block Exemption Regulation (GBER). It is your responsibility to make sure that your organisation is eligible to receive state aid.

Your proposal

Your proposal must:

  • identify how your project intends to deliver or enable delivery of significant reductions in industrial CO2 emissions in an industrial cluster by 2030 or earlier
  • identify how your project intends to contribute to achieving net zero by 2050 and whether your project has any potential to achieve net zero by 2040
  • demonstrate alignment with the objectives of the ISCF Industrial Decarbonisation Challenge and the BEIS Industrial Clusters Mission
  • deliver or enable delivery of either offshore storage of CO2 or onshore infrastructure related to industrial decarbonisation
  • demonstrate the regional and national significance of your project
  • demonstrate what networks, stakeholders and audiences will contribute to the project and what information will be disseminated
  • consider the wider cross-economy decarbonisation scenarios
  • explain how the project is, and will remain, compliant with all state aid regulations
  • identify the funding to be made available by each organisation and on what timeframe
  • demonstrate how the project will lead to decarbonisation of industrial clusters after the ISCF funding from this competition ends in March 2024.

It is responsibility of applicants to get independent State aid legal advice.

We may choose to take a portfolio approach in this competition, based on:

  • geographical location
  • cost and funding available
  • project timescales (inclusive of any date ranges)
  • alignment with and contribution to the decarbonisation of industrial clusters and wider cross-economy decarbonisation
  • affordability considerations (longer term cost to the taxpayer)

projects awarded funding through the cluster plans competition.

Specific themes

We expect an offshore project to include offshore storage of CO2 and offshore pipework.

We expect an onshore project may include onshore pipework, gas compression, hydrogen production, hydrogen pipework, gas storage, carbon capture and shipping options.

We expect all projects to include a mix of:

  • engineering designs
  • simulations
  • commercial arrangements
  • impact assessments
  • baseline measurements and forecasts

Research categories

We will fund industrial research projects as defined in the guidance on categories of research.

Projects we will not fund

We are not funding solutions that do not align with the BEIS Industrial Clusters Mission or the ISCF Industrial Decarbonisation Challenge Fund.

23 June 2020
Competition opens
30 June 2020
Online briefing event
7 October 2020 11:00am
Competition closes
13 November 2020
Invite to interview
30 November 2020
Interview panel
1 December 2020
Interview panel
2 December 2020
Interview panel
3 December 2020
Interview panel
4 December 2020
Interview panel
11 December 2020
Applicants notified
11 December 2020
Applicants notified

Before you start

What we will ask you

The application is split into 3 sections:

  1. Project details.
  2. Application questions.
  3. Finances.

Interviews

If your online application is above the quality threshold for this competition, you will be invited to an interview, where you must give a presentation. You may be asked to attend in person or online. We will tell you the interview location closer to the time. The interviewers will make recommendations for project funding based on the outcome of the interview.

By the deadline stated in the invitation email, you:

  • must send a list of who will attend the interview
  • must send your interview presentation slides
  • can send a written response to the assessors’ feedback

List of attendees

Up to 5 people from your project can attend, ideally one person from each organisation. They must all be available on all published interview dates. We are unable to reschedule slots once allocated.

Presentation slides

The key themes for the interview presentation will be determined closer to the time. Your presentation must:

  • use Microsoft PowerPoint
  • be no longer than 45 minutes
  • have no more than 20 slides
  • not include any video or embedded web links

You cannot change the presentation after you submit it or bring any additional materials to the interview.

Written response to assessor feedback

This is optional and is an opportunity to answer the assessors’ concerns. It can be up to 4 A4 pages in a single PDF or Word document.

Interview

After your presentation the panel will spend up to 90 minutes asking questions. You will be expected to answer based on the information you provided in your application form, presentation and the response to feedback.

1. Project details

This section provides background for the assessors and is not scored.

Application team

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

Application details

The lead applicant must complete this section. Give your project’s title, start date and duration.

Project summary

Describe your project briefly, and be clear about what makes it innovative. We use this section to assign 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 be immediately rejected and will not be sent for assessment. We will give you feedback on why.

Your answer can be up to 600 words long and must include a statement of compatibility with state aid requirements which is supported by a summary of your response to Question 2 on state aid.

2. Application questions

The assessors will score your answers. You will receive feedback from them for each one.

Do not include any website addresses (URLs) in your answers.

Question 1. Equality, diversity and inclusion (not scored)

We collect and report on equality, diversity and inclusion (EDI) data to address under-representation in business innovation and ensure equality, diversity and inclusion across all our activities. You must complete this EDI survey and type ‘EDI survey completed’ within your answer.

The survey will ask you questions on your gender, age, ethnicity and disability status. You will always have the option to ‘prefer not to say’ if you do not feel comfortable sharing this information.

Question 2. State aid

This is a pass/fail question with no score. If your response is assessed as fail, your proposal will be rejected.

Explain how the project is compliant with State aid regulations, and how it will remain compliant for the duration of the programme.

Describe:

  • the article used and how it applies to the project for example, the eligibility criteria
  • what legal advice was sought
  • how the project satisfies the state aid criteria under the relevant article
  • how you will be match funding the project to comply with state aid requirements
  • whether all partner organisations will be including match funding or if alternative arrangements are proposed
  • any anticipated risks or opportunities associated with State Aid Regulations

Your answer can be up to 400 words long

Question 3. Strategic fit

This question is worth 30% of the score.

How will this project contribute directly to achieving significant reductions in industrial C02 emissions across industrial clusters?

Describe:

  • how the project will produce solutions to achieve significant reductions in emissions in an industrial cluster by 2030, or earlier, contribute to achieving net zero by 2050, and any potential to achieve net zero by 2040
  • how the project aligns with the objectives of the ISCF Industrial Decarbonisation Challenge, and BEIS Industrial Clusters Mission
  • how your project is linked to other projects in your cluster region which are eligible to submit a proposal to this competition, and any letters of support or collaboration agreements which confirm these arrangements.
  • the regional and national significance of the project, including how the project will address the wider cross-economy decarbonisation choices and scenarios
  • how you are ensuring the technical viability of your project, including how work carried out in Phase 1 has contributed to this understanding
  • the level of industry involvement, including the number and size of participating companies
  • how the project connects to the ISCF cluster plan competition
  • how the proposed activities in the cluster are scaleable and replicable, to support wider decarbonisation
  • how you are ensuring the commercial viability of your project, including how work carried out in Phase 1 has contributed to this understanding
  • compatibility, where possible, with other government funding such as the Industrial Energy Transformation Fund, the BEIS Energy Innovation Programme (including CCUS, hydrogen and industrial fuel switching), the Low Carbon Hydrogen Production Fund (LCHF) and the Carbon Capture and Storage (CCS) Infrastructure Fund (further details of the CCS Infrastructure Fund are expected to be published in the summer and industry engagement on the LCHF is expected later in 2020)
  • how the project might evolve over time to reflect emerging government policy

Your answer can be up to 800 words long. You can submit one appendix to support your answer. It must be used for the sole purposes of providing copies of any letters of support from other projects eligible to apply for this competition, or summarising a collaboration agreement between the eligible projects. It must be a PDF and can be up to 3 A4 pages long. The font must be legible at 100% zoom.

Question 4. What does success look like?

This question is worth 10% of the score.

How will you know the project has been successful?

Describe:

  • the project’s success criteria and how these will be measured
  • what evidence and data will be collected, including how and when this will be done and who will be responsible
  • what the end result of the project would be (what is gained at the end)?
  • the intended longer term benefits (including social, economic and environmental) of the proposed project, and how progress towards achieving these will be captured and measured by the project
  • the anticipated longer term benefits of emissions reduction within the cluster, and contribution to meeting the objectives of the Industrial Clusters Mission, including an estimate of the timescales for achieving these
  • the anticipated longer term economic benefits, including employment, supply chain development, skills development and attractiveness for new investment, including an estimate of the timescales for achieving these

Your answer can be up to 600 words long.

Question 5. Value for money

This question is worth 10% of the score.

How will the project lead to decarbonisation of industrial clusters in the long-term, after the ISCF investment period of March 2024?

What long-term gains would be achieved through this level of public funding?

Describe:

  • what this investment would enable your project to do
  • plans for ensuring the long-term sustainability of the industrial cluster after the ISCF investment period of March 2024 and the anticipated longer term gains which will arise
  • the affordability of the proposal for both industry and the taxpayer
  • how you will ensure that the project will achieve commercial viability, including the timeline for this to occur and the assumptions which you have made
  • any procurement activities that might be needed, and your approach to procurement
  • how you will be match funding the project to comply with state aid requirements
  • what investment can be committed to this project, in addition to the match funding required by state aid? Explain what the investments are, when they will occur, and the value attributed to them

Your answer can be up to 600 words long. You can submit one appendix to support your answer. It must be a PDF and can be up to 2 A4 pages long. The font must be legible at 100% zoom.

Question 6. Project delivery

This question is worth 10% of the score.

What activities, approaches and methods will you be delivering and how will this be achieved?

Describe:

  • the key activities to take place over the course of the project, including key milestones (decision points, approvals and so on) and provide a detailed project plan as an appendix
  • the 3 most critical areas of the project and their associated timelines
  • any key performance indicators (KPIs) appropriate to the project
  • the key information needing to be retrieved or researched in order to deliver the project
  • any areas that cannot be progressed within the timeframe and/or budget available
  • your approach to project and programme management
  • the resources, skills and capabilities that will be needed to deliver the project, and how you will address any gaps within your project team
  • how you will promote equality, diversity and inclusivity within the project, including how the work undertaken in Phase 1 has informed your plans. Demonstrate how your project team for Phase 2 reflects your approach
  • how you will demonstrate that project partners and any subcontractors can deliver the project to the proposed timeframe

Your answer can be up to 600 words long.

You must submit one appendix to support your answer. This should include a short summary of the main people working on the project, and must include a project plan. The project plan must be based on a start date of 1 March 2021 and include the expected finish date. The appendix may also include a preferred start date (if this is later than 1 March 2021) and a preferred finish date, and any flexibility of the preferred start and finish dates (either side of the preferred dates) that would not impact costs. The appendix must be a PDF and can be up to 4 A4 pages long. The font must be legible at 100% zoom.

Question 7. Knowledge sharing and stakeholder engagement

This question is worth 20% of the score.

How will you actively share knowledge and lessons learnt between partner organisations within the project, counterparts in the cluster plan competition and between other industrial clusters?

Describe:

  • why knowledge sharing is important to your cluster
  • the benefits which will arise from knowledge sharing
  • over what timescale these benefits will be realised
  • what types of information you plan to share within your cluster (including project partners and non-partner organisations)
  • what types of information you plan to share with other UK clusters (whether funded through this ISCF programme or not)
  • what types of information you plan to share with the cluster plan project in your cluster region (whether funded through this ISCF programme or not)
  • what types of information you plan to share with government, in particular the BEIS Industrial Clusters Mission

  • what types of information you plan to share with ISCF (in addition to standard reports issued for monitoring purposes)
  • what types of information you plan to share with any other stakeholders which you have identified
  • what knowledge sharing arrangements you will put in place and how you will ensure that information is disseminated effectively (including considerations such as timeliness and means of communication)
  • how you will ensure that your project takes account of other relevant work, for example successful and unsuccessful international deployment projects, previous government-funded or EU-funded work in the UK, and academic studies
  • how you will interact with the Industrial Decarbonisation Research and Innovation Centre (IDRIC), and what benefits this interaction will deliver to your cluster and to IDRIC
  • what processes you will adopt for ensuring that lessons are learned by the broad communities of stakeholders which need to be involved in industrial decarbonisation

Your answer can be up to 800 words long.

Question 8. Project governance and stakeholder management

This question is worth 10% of the score.

How do you intend to set up the governance arrangements to deliver this project successfully? How will you manage all stakeholders effectively?

Describe:

  • the governance structure to be put in place, including how you intend to manage the resolution of issues
  • the relationship between project partners and where each partner adds value to the project
  • how you will ensure that any subcontractors deliver to the required quality and timescales
  • the reporting mechanisms to be put in place for internal and external use.
  • the wider engagement that needs to occur with other stakeholders external to the core partner applicants, and how this will be managed

Your answer can be up to 600 words long. You can submit one appendix to support your answer. It must be a PDF and can be up to 4 A4 pages long. The font must be legible at 100% zoom.

Question 9. Risks

This question is worth 10% of the score.

What are the key risks and opportunities for the project?

Describe:

  • the risks to developing and implementing a robust project, including technical, legal, commercial, policy, supply chain, evidence and data gathering, sourcing information and so on. Produce a RAG (red, amber, green) rating for each
  • how the work undertaken in phase 1 has influenced your understanding of project risk
  • how risks are spread, for example, across industry, consumers and taxpayers
  • the changing level of risks over the lifetime of the project
  • any assumptions that have been made, and the approach to identify any that may be made during the development of the deployment project
  • any mitigations that can be put in place to reduce the risk, including consideration of the potential for access to multiple sources of CO2 and multiple CO2 stores, where relevant
  • any opportunities that could arise
  • how the project will deal with uncertainty
Your answer can be up to 600 words long. You can submit one appendix. It can include diagrams and charts. It must be a PDF and can be up to 2 A4 pages long. The font must be legible at 100% zoom.

3. Finances

Each organisation in your project must complete its 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 please see our project costs guidance.

Background and further information

Support

If you need more information about how to apply email support@innovateuk.ukri.org or call 0300 321 4357. Our phone lines are open from 9am to 11:30am and 2pm to 4:30pm, Monday to Friday (excluding bank holidays).

Enterprise Europe Network

If you are a UK SME and successful in receiving an award, you will be contacted by your local Enterprise Europe Network (EEN) Innovation Advisor. They act on behalf of Innovate UK to discuss the growth opportunities for your business.

They offer bespoke business support services to help you maximise your project and business potential. This service forms part of your Innovate UK offer under our commitment to help UK SMEs grow and scale.

Please engage positively with your EEN contact so that, working together, you can determine the most appropriate form of growth support for your business.

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