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Funding

Funding

Our industry regulator Ofgem provides essential backing for innovative projects to make energy networks smarter, accelerate the development of a low carbon energy sector and deliver financial benefits to customers. The projects help develop crucial knowledge and expertise which is being shared across the industry.

Network Innovation Competition

Ofgem introduced the Electricity Network Innovation Competition (NIC) in 2015 as part of our industry’s current price control (referred to as RIIO-ED1).

The Electricity NIC is an annual opportunity for electricity network companies to compete for funding for the development and demonstration of new technologies, operating and commercial arrangements. Funding is provided for the best innovation projects which help to provide environmental benefits, cost reductions and security of supply as Great Britain moves to a low carbon economy. Up to £81m per annum is available. NIC replaces the second tier of the Low Carbon Networks Fund.

Funding for our first NIC project, Celsius, was announced in November 2015.

Network Innovation Allowance

The Network Innovation Allowance (NIA) provides limited funding to electricity network companies like ourselves for two purposes:

  • To fund smaller technical, commercial or operational projects directly related to our network that have the potential to deliver financial benefits to our company and our customers
  • To fund the preparation of submissions to the NIC.

Ofgem introduced the NIA in 2015 to replace the first tier of the Low Carbon Networks Fund.

Low Carbon Networks Fund

Ofgem established the Low Carbon Networks (LCN) Fund as part of the electricity distribution price control that ran until 31 March 2015.

The LCN Fund allowed up to £500m to support projects sponsored by electricity network companies to try out new technology, operating and commercial arrangements. The aim of the projects is to help all network companies understand how they can provide security of supply at value for money as Britain moves to a low carbon economy.

Ofgem granted us funding for a number of low carbon research projects ranging from £1.3 million on small-scale first tier projects to multi-million pound trials (second tier projects). Our second tier projects are Capacity to Customers, CLASS, Smart Street and Respond.