Applied resarch and development (R&D) funding
There are a number of funds available to support R&D, which have been used successfully by both renewable energy and energy efficiency companies:
1. Grant for Research and Development
This scheme replaces the DTI SMART Award and is now managed by the Regional Development Agencies. The grant helps businesses carry out research and development work that will lead to technologically innovative products or processes. It is aimed at individuals planning to start up businesses in England and at businesses already operating in England. Applicants must have fewer than 250 employees, and approximately £40 million in assets.
Grant awards vary in size and percentage depending on the size of the businesses and the nature of the project. Exceptional projects can receive up to half a million pounds at an intervention rate of 35 per cent. Applications can be made at any time. Criteria include technological innovation, commercial assessment and applicant experience.
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2. Carbon Trust Applied Research Programme
The Carbon Trust’s Applied Research Programme is open to UK businesses and research institutions and aims to support the development and commercialisation of technology with the potential to reduce UK carbon dioxide emissions. It offers grants of up to £250,000 towards the cost of projects. A minimum 40 per cent match-funding is required, and, to be successful, the project must demonstrate:
- genuine innovation and the potential to contribute to substantial reductions in UK greenhouse gas emissions
- that the work is a well planned and builds on previous work in the area
- that the results of the work will allow a clear step forward on the path towards commercialisation
- that it represents good value for money
The application is a two-stage process and calls are made three times a year.
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3. Collaborative Research & Development
This scheme is run by BERR (formerly the DTi) and replaces the New and Renewable Energy R&D Programme.
The objective of the Collaborative Research & Development programme is to assist the industry and research communities to work together on research and development in strategically important areas of science, engineering and technology, from which successful new products, processes and services can emerge. Collaborative research & development projects must involve two or more collaborators, at least one of which is from industry. The scheme supports pure or oriented basic research, applied research, and experimental development.
It programme normally provides grants of up to £8 million, although it is possible to bid for larger amounts in some circumstances. It is a two-stage process with calls for funding twice a year. It is not available to single companies, and it requires a formal collaboration agreement between partners.
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4. Selective Finance for Investment
The South West of England Regional Development Agency delivers the Selective Finance for Investment in England (SFI) grant , aimed at its businesses of all sizes that were looking to invest in assisted areas that need a grant to take their vision forward.
The scheme focuses support on high-quality, innovative, knowledge-based projects that lead to long-term improvements in productivity, skills and employment in South West England. The majority of jobs created are expected to be at NVQ Level 2 and above.
Projects such as launching a new business, expanding existing companies, introducing new technology into manufacturing, or taking a new product from its early stages all the way through to production will be eligible for support.
Under SFI there is now a minimum threshold of £10,000 for grant applications. Grants between £250,000 and £2 million will be appraised within the South West RDA and referred to the South West Industrial Development Board. Any projects needing grants over £2 million will be appraised by the Department for Business, Enterprise and Regulatory Reform (BERR).
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5. The Small Firms Loan Guarantee
The SFLG is a joint venture between the Department for Business, Enterprise and Regulatory Reform (BERR) and a number of participating lenders. Participating lenders administer the eligibility criteria and make all commercial decisions regarding borrowing.
The main features and criteria of the scheme are:
- A guarantee to the lender covering 75 per cent of the loan amount, for which the borrower pays a 2 per cent premium on the outstanding balance of the loan, payable to the BERR.
- The ability to guarantee loans of up to £250,000 and with terms of up to ten years.
- Availability to qualifying UK businesses with an annual turnover of up to £5.6million and which are up to five years old. Availability to businesses in most sectors and for most business purposes, although there are some restrictions.
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Other sources of research and development support
Carbon Vision is a partnership between the Carbon Trust and the Engineering and Physical Sciences Research Council. It supports university-based research studies to explore the transition to a low carbon economy.
Framework Programme 7 (FP7) This is the latest round of the principal European Union funding programme for R&D funding totalling over €50billion, with approximately €2 billion directly related to research on renewables and on low-CO2-emitting power generation. Launched in January 2007 it will run until 2013. The funds are available from a consortia of businesses, universities, research centres, organisations or individuals throughout the EU and selected other countries.
