UK businesses developing next-generation energy storage have a new funding opportunity: Innovate UK has opened a competition offering a share of up to £3 million for project development studies.
The competition is aimed at electrochemical ultra-long duration energy storage technologies capable of supplying electricity to the grid continuously for at least 100 hours. For eligible small firms working in batteries, engineering, manufacturing, software, materials or the wider energy supply chain, the important point is that this is not simply a research announcement. It is an open competition with a deadline of 11am on 30 September 2026.
What funding is available?
Individual projects must request between £350,000 and £700,000 in grant funding. Projects are expected to last between three and nine months, start by 1 January 2027 and finish by 30 September 2027.
Micro and small businesses can receive funding for up to 70% of eligible feasibility-study costs. The ceiling falls to 60% for medium-sized businesses and 50% for large organisations. Applicants therefore need to identify how they will finance the remaining share and should not treat the headline grant figure as full project funding.
A UK-registered business of any size can lead a project, either alone or with collaborators. Universities cannot lead or apply alone, but businesses can build a consortium involving academic institutions, charities, not-for-profits, public-sector organisations and research and technology organisations. Subcontractors are also allowed, subject to the competition rules.
What projects need to deliver
The programme is focused on technologies that could support the UK electricity grid with at least 100 hours of continuous discharge and a working life of at least 25 years. Successful proposals must produce a project development study covering six areas:
- technology assessment;
- engineering design;
- a cost and scale-up roadmap;
- market assessment;
- a development plan; and
- a manufacturing and supply-chain plan.
This is the first phase of a planned two-stage programme. At least £10 million has been allocated for a proposed second phase, expected in mid-2027, which would support large-scale demonstrators. Receiving first-phase funding will not be a condition for applying to phase two, but Innovate UK is encouraging businesses to use this competition to work through the delivery problems that stand between a concept and construction.
Why this matters to smaller firms
The opportunity is specialised, so it will not suit a general energy-efficiency product or a conventional battery installation business. But the scope may create openings beyond the company that owns the core storage technology. Smaller engineering, modelling, control-system, testing, advanced-materials and manufacturing businesses may be valuable partners or subcontractors where they can make a clear contribution to a credible project.
That partnership route matters because a strong application must cover technical performance, commercial potential, scale-up and the UK supply chain. A technology developer may need complementary expertise to answer all of those questions convincingly.
The broader £28 million Ultra-Long Duration Energy Storage Challenge is intended to develop storage technologies that can reduce reliance on volatile gas generation, strengthen energy security and create new UK manufacturing opportunities. Those benefits are long-term rather than an immediate cut to a small firm’s electricity bill. Businesses should assess the competition on its direct commercial fit, not on wider claims about future energy prices.
A practical application checklist
Interested firms should first confirm that the proposed technology and project fall squarely within the published scope. They should then work backwards from the 30 September deadline and decide whether to lead, collaborate or offer specialist subcontracted work.
Before committing resources, check that the project can meet the January 2027 start date, that most funded work and spending will take place in the UK, and that the business can cover its unfunded share. A proposal should also show a realistic route to UK manufacture and exploitation, rather than stopping at a laboratory result.
For collaborative applications, partners should agree roles, costs, intellectual-property expectations and delivery responsibilities early. The lead organisation must invite partners through the Innovation Funding Service, and no single organisation in an eligible collaboration can claim more than 70% of total project costs.
Smaller innovators may also want to compare this national competition with the changing landscape of local innovation funding. The right route depends on the maturity of the technology, the size of the project and whether the business can assemble the required technical and financial case.
