Industrial Energy Transformation Fund (IETF) – to help businesses with high energy use cut their bills and their carbon emissions

What is the Industrial Transformation Fund?

The Industrial Energy Transformation Fund (IETF) supports industrial sites with high energy use to transition to a low carbon future. The fund targets existing industrial processes, helping industry to cut energy bills by investing in more efficient technologies and reduce emissions by bringing down the costs and risks associated with investing in deep decarbonisation technologies.

A bit more background on the IETF can be found in our blog on IETF Phase 1: Spring 2021.

Phase 2: Autumn 2022 – overview

The Phase 2: Autumn 2022 competition opened for applications on 10 October. The grant is open to businesses of any size registered and operating in England, Wales or Northern Ireland operating an existing site that falls into specified SIC codes (covering: mining and quarrying; manufacturing; recovery and recycling of materials and data centres)

It provides approximately £70 million of grant funding for the following project types: studies; energy efficiency and deep decarbonisation projects.

Details of the Phase 2: Autumn 2022 competition can be found at link. Linked documents to this webpage include IETF Phase 2 Autumn 2022: guidance for applicants

Energy efficiency deployment projects

This strand of the IETF will provide grant support of between £100k and £14m for “onsite deployment of [eligible] technologies that will improve the energy efficiency of an industrial process”.  You can aggregate up to 5 projects within an application and grant intervention rates as follows:

·         30% for large sized businesses

·         40% for medium sized businesses

·         50% for small sized businesses

Note: higher intervention rates are possible in Tier 1 and Tier 2 areas

Eligible technologies

Include:

·         Industrial process control systems (for example: discrete controllers, distributed control systems, SCADA systems and programmable logic controllers) that measure, monitor and control equipment within an industrial process to improve energy efficiency

·         More efficient combustion equipment, including installation of hydrogen ready boilers where there is an efficiency improvement

·         Heat pumps that provide energy in the form of heat or cooling to an industrial process, where the heat is sourced from the natural environment

·         Energy recovery from waste heat produced in an industrial process, using heat pumps, where the energy is utilised in an industrial process on site

The IETF will not fund projects for which there is existing support through government schemes or an established market.

The Guidance encourages you to check that your proposal is eligible by contacting BEIS as early as possible, before you start writing the application. To get in touch you can email [email protected] making sure that you include “Eligibility screening” in your email title.

Criteria

Applications will be assessed against three criteria, which are overviewed in more detail, with scoring guides, in the Guidance:

·         Economic Assessment

·         Transformational Assessment

·         Deliverability Assessment

Next steps

I would strongly advise potentially interested parties to read through the Guidance (116 pages) and associated videos and webinars.

If you are interested, and have a project in mind, contact BEIS to check eligibility.

This Phase closes for applications on at 3pm (GMT) on 13th January 2023. Further key dates include:

·         Expected notification of results of the initial assessment stage – May 2023.

·         Expected completion of due diligence and issuing of Grant Funding Agreements – July 2023.

·         All projects must start no later than 1st July 2024 and finish no later than 31st March 2025

PKF Francis Clark

As we get more details on this fund, we will update this blog. We are in the process of summarising other sources of grant and debt funding for ‘green’ projects.  (if anyone reading this is aware of any such funds please let me know and I will pass details on). This is in response to an increase in the number of enquiries for such information.