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Designing the Industrial Energy Transformation Fund

The Industrial Energy Transformation Fund (IETF)​ will help industry to improve energy efficiency, cut energy bills and shift to lower carbon energy and processes.

Objectives of the consultation

The Industrial Energy Transformation Fund (IETF) was announced in the autumn Budget in 2018. The Fund will support businesses with high energy use, such as energy intensive industries, to transition to a low carbon future and to cut their energy bills and carbon emissions through investing in energy efficiency and low-carbon technologies. The IETF has a UK-wide budget of £315m over five years to 2024.

In designing the scheme the Government needs to consider how best to balance the two objectives. This could include design features such as differentiated criteria for different types of project, budget or sectoral ring fencing, phasing of the energy efficiency and industrial decarbonisation elements or even creating two separate schemes.

For the industrial decarbonisation objective, there is a range of choices in how the IETF could support the transformation of industries in preparation for a low carbon future. This would complement the Industrial Clusters Mission which covers many of the UK’s world-leading industries. In particular, some options for IETF’s decarbonisation focus include:

  • Near-term carbon emission reductions as IETF covers the next few years while the Industrial Clusters Mission will support long-term decarbonisation;
  • Promoting investment in particular technologies;
  • Supporting technologies that are strategically important to long-term emissions reductions such as hydrogen and CCUS;
  • Supporting demonstration at scale of particular technologies (e.g. electric arc furnaces);
  • Mature deployable technologies, such as heat pumps, biomass steam boilers, biomass, combined heat and power;
  • Uptake of low carbon industrial processes, such as low carbon steel or cement production.

This informal consultation sought views and supporting evidence to help the Government design the fund, focusing on the benefits and barriers to industrial decarbonisation.

This consultation closed on 31 May 2019.

Supporting papers

To download the consultation document, please follow the link below.

CIBSE response

CIBSE did not submit a response to this consultation as there were no significant comments from CIBSE Members.