Government funnels £185m into Industrial Energy Transformation Fund

The UK Government has committed to fully decarbonising at least one industrial cluster by 2040. Pictured: Ellesmere Port

Minister for Energy Efficiency and Green Finance Lord Callanan unveiled the new funding on Monday 22 September. From next week, businesses will be able to apply for shares of £185m from the Industrial Energy Transformation Fund.

The fund is designed to reward businesses with projects and initiatives that can help their operations run on clean energy by switching to renewables, replacing inefficient equipment and utilising electric solutions and hydrogen.

The fund is targeting businesses in sectors including manufacturing and recycling and will offer a share of the prize to controlled environment horticulture, industrial laundries and textile renting facilities for the first time.

The Government states the fund will help deliver the nation’s net-zero target for 2050.

Minister for Energy Efficiency and Green Finance Lord Callanan said: “From manufacturing chemicals to food and drink, UK industry is at the heart of our economy.

“With over £190m available for businesses to make the move to cleaner, cheaper energy – and with 12 projects benefiting directly today – we are delivering the support they need to decarbonise.

“I look forward to seeing the plans developed by the successful clusters and encourage other businesses to apply to our Industrial Energy Transformation Fund, which has already made awards to over 150 projects to help companies go green.

Lord Callanan also unveiled the 12 winners of a Local Industrial Decarbonisation Plan competition, which will each receive a share of up to £6m for low-carbon projects. Winning projects also receive access to technical advisors to prepare for adopting measures such as using hydrogen or carbon capture.

The Local Industrial Decarbonisation Plan focused on companies in dispersed locations, away from industrial accounts. These locations account for more than half of the UK’s industrial emissions.

Winners include Shoreham Port Industrial Cluster, an established cluster with 175 businesses based on the 110-acre site, which aims to reduce emissions and improve air quality, the Industrial Decarbonisation for Northern Ireland and the Decarbonising the Midlands Aerospace Cluster (DMAC).