Ofwat to throw open doors to innovation funding competition

Ofwat has unveiled plans to launch a new “open access” competition in “early 2023” with £4m available to innovators from any sector “to apply with their game-changing ideas for the water sector.”

Individual awards will be limited to £500,000. The new competition is part of an evolution in the regulator’s existing £200m Innovation Fund Ofwat said it was looking to sectors including fintech, manufacturing and materials, community groups and local government to come forward.

Meanwhile the third of the regulator’s Water Breakthrough Challenge will launch in October 2022 with a total of £38m available for innovative water companies and their partners.

The annual challenge will comprise a £8m Catalyst stream and a £30m Transform stream. Entrants to the Catalyst stream can bid for between £500,000 and £2m, while entrants to the Transform stream can bid for between £2m and £10m.

Senior director of strategy, finance and infrastructure at Ofwat, John Russell, said: “Over the next three years we will distribute approximately £120m to more innovative initiatives. We're also currently consulting on continuing [the Innovation Fund] to 2030.”

Continuation of the fund is subject to the regulator's consultation on its draft methodology for the 2024 price review. Ofwat expects to publish a full consultation decision companion document on the Innovation Fund in autumn 2022, which will “set out further information on the headline decisions.” And Ofwat said it will include more detail on the new open access competition, which will be developed in further consultation with the water sector in the coming months. ​

Ofwat's innovation fund “incentivises and rewards collaborative innovation in the water sector.” Projects must meet key objectives for the industry around one or more of Ofwat’s four innovation themes:

• adapting to climate change and achieving net zero emissions;

• protecting and enhancing the environment;

• delivering long-term operational resilience; and

• improving the delivery of services for customers and society.