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What is the Industrial Energy Transformation Fund (IETF)?

Is your business installing energy & carbon reduction measures including heat pumps? Find out about the funding available.

In 2020, the UK government launched the new Industrial Energy Transformation Fund (IETF) to help businesses install energy and carbon reduction measures including heat pumps within their industrial processes. Delivered by Innovate UK on behalf of the Department of Business, Energy and Industrial Strategy (BEIS), this has pledged up to £315M in funding and is available in two phases.

  • Spring 2021 phase
    £40m in funding is open and split equally between two strands (see below).
  • Future phases
    Offers the remaining £245m to industrial businesses and extends to complex decarbonisation projects.

Strand 1: Energy efficiency technologies

For technologies that improve the energy efficiency of industrial processes. These technologies will need to be demonstrably effective, either through testing or previous deployment, and the project must only be possible via this funding.

It could involve technologies such as more efficient heat exchange; resource process optimisation; or improved process control. Please note, most onsite electricity generation technologies are exempt from this funding.

Strand 2: Industrial energy efficiency and decarbonisation studies

This strand focuses on building future deployment project pipelines through financing feasibility and engineering studies, as well as reducing the costs or risks of either energy efficiency or decarbonisation technologies.

In both strands, the IETF is looking to fund a portfolio of projects in order to diversify funding.


How we can help

Centrica Business Solutions can help you to take advantage of the IETF and see what carbon reduction measures, such as installing heat pumps are possible. Our experts have been supporting organisations for over 40 years with on-site energy insight, optimisation and generation services and solutions.


Pledged in Spring 2021 for IETF competition, split between two strands.

Of capex for energy efficiency projects. 25-40% of capex for feasibility and engineering studies
Minimum grant size for energy efficiency projects, with grants exceeding £3m requiring advance notice.