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Government announces £166 million funding package for green technologies

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UK government has today announced a £166.5 million investment package for green technologies able to help the UK meet its climate targets.

The multi-million-pound fund, being awarded to innovators, businesses, academics, and heavy industry right across the UK, aims to accelerate the delivery of the technologies needed to further drive Britain’s climate change ambitions, including carbon capture, greenhouse gas removal and hydrogen, while creating over 60,000 jobs.

Energy Minister Anne-Marie Trevelyan said:

“We are determined to tackle climate change and make it win-win for both our planet and our economy. Today’s major cash boost – targeted at our most polluting industries – will encourage the rapid development of the technologies we need to reign in our emissions and transition to a green economy, one that reduces costs for business, boosts investment and create jobs.

“Just 6 months ago, the Prime Minister set out a clear 10 Point Plan for creating and supporting up to 250,000 British jobs as we level up and build back greener from the pandemic. Today we’re boosting our armoury for the fight against climate change and backing innovators and businesses to create green jobs right across the United Kingdom.”

The Prime Minister’s 10 Point Plan committed to removing 10 megatonnes of carbon dioxide, generating 5GW of hydrogen by 2030, and creating 250,000 green jobs. Today’s announcement has been made to help facilitate this plan and includes:

  • A £60 million ‘Low Carbon Hydrogen Supply 2’ (HYS2) competition to support the development of low carbon hydrogen in the UK and to identify and scale-up more efficient solutions for making clean hydrogen from water using electricity. This new competition will be split into 2 streams:
      • Stream 1 (up to £30 million) will support development of solutions to a market entry stage. This Stream will be run over 2 phases – feasibility followed by demonstration. The funding will be split across 4 categories to encourage a diverse range of technologies; Low carbon hydrogen production; Zero Carbon hydrogen production; Hydrogen Storage and Distribution; and Net zero hydrogen supply solutions.
      • Stream 2 (up to £30 million) will support more developed projects, with a view to creating a pipeline of projects for the £240 million Net Zero Hydrogen Fund.
  • £37.5 million to fund a government programme of greenhouse gas removal methods. Of this, 24 projects across England and Wales will receive up to £250,000 to fund innovative designs that develop new ways of removing greenhouse gases from the atmosphere and store them safely, and a further 5 projects will receive up to £4.5 million each to investigate the viability of adopting greenhouse gas removal methods at scale.
  • A £20 million competition to support the development of the next generation carbon capture, usage and storage (CCUS) technologies so they can be deployed at scale by 2030. The first CCUS call will consider grant applications of up to:
      • £50,000 for industrial, waste or power sector companies performing analysis on next generation carbon capture technology that are most suited to their site or industrial sector
      • £1 million for projects developing and piloting mid-stage technology
      • £5 million for projects demonstrating late-stage technology at intermediate scale at site
  • £20 million to establish a new virtual Industrial Decarbonisation Research and Innovation Centre that will accelerate the decarbonisation of key energy-intensive industries which currently make a significant contribution to UK emissions. 
  • £16.5 million through the Industrial Energy Transformation Fund to develop new technologies and processes that help energy-intensive sectors cut their emissions, while reducing their energy bills.
  • £8 million for projects to develop innovations, such as re-purposing textile waste, new clay production techniques for the ceramics industry and concrete manufacturing that support the rapid recovery and sustainability of UK industry.
  • £4.7 million will establish a new Transforming Foundation Industries Research and Innovation Hub, led by Cranfield University, to will help industries like metals, glass, cement, paper and glass to work together and address their common challenges, while accelerating the development and adoption of new technologies and business models.

£86 million of the total funding package announced today comes from the government’s £1 billion Net Zero Innovation Portfolio, which provides funding for low-carbon technologies and systems.

Projects receiving funding include:

  • Professor Christopher Evans, UK Centre for Ecology and Hydrology is being backed with almost £4.5 million to manage and restore peatlands to maximise their greenhouse gas removal potential at farmland near Doncaster, and at upland sites in the South Pennines and in Pwllpeiran, West Wales.
  • Celsa Manufacturing, Cardiff, Wales, will receive £3 million to install new technologies to reduce emissions and improve energy efficiencies in the process to melt scrap metal and produce steel.
  • Saint-Gobain Glass, Eggborough, North Yorkshire, will receive over £1.4 million to deliver a new flat glass production furnace to improve the efficiency of its UK plant while reducing energy consumption, emissions and on-going maintenance costs.
  • Tate & Lyle, London, will receive over £500,000 to study how it can decarbonise its sugar refinery and reduce greenhouse gas emission by 90%.
  • Phillips 66 Limited, Humberside, will receive over £500,000 explore switching fuel in its gas refinery’s industrial fired heaters with renewable and low carbon hydrogen.
  • Over £250,000 for a Direct Air Capture (DAC) technology project led by Storegga owned subsidiary Pale Blue Dot Energy. DAC technology has the potential to accelerate UK net zero efforts by capturing carbon dioxide directly from the atmosphere so it can be stored permanently underground.
  • Scotland’s Rural College alongside partners University of Strathclyde, Agri-EPI Centre and No Pollution Industrial Systems Ltd, is receiving over £200,000 to reduce the environmental impact of beef production. The project aims to capture the greenhouse gas methane from housed cattle and convert it to carbon dioxide and energy using a novel system. At the same time, manure and waste feed will be converted to a fertiliser and biogas that will be used to power farm sheds and produce low-carbon fruits and vegetables. 
  • BAE Systems, Glascoed, Wales, has been awarded over £82,000 to incorporate energy efficient technology that replaces a steam heating system at the company’s Glascoed site.

To express your interest in either the HYS2 and/or CCUS competitions please follow the below links:

More information is available on the Government’s website.


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