Ofwat locks in intellectual property change for its next round of innovation funding competitions

Ofwat has confirmed a proposal it consulted on in August to trial a new approach to intellectual property rights (IRP) in the next round of its Innovation Fund competitions.

Under the new arrangements, half the funding available for the Catalyst stream (smaller competition) and all the funding for the Transform stream (main competition) will stick with existing rules, and the other half of the Catalyst stream funding will trial enabling owners of background IPR to charge a licence fee at a fair, reasonable and non-discriminatory rate for the use of the background IPR solely to the extent necessary for water companies to receive the benefit of the foreground IPR. Further, Ofwat said for the element of the Catalyst stream that is not subject to the background IPR trial, it will maintain the ability for entrants to request alternative IPR arrangements.

The next round of the competition, dubbed Breakthrough 2, will open on 11 October 2021. It will provide a unified and streamlined process for water companies in England and Wales to access the funding through two streams:

a Catalyst stream that will make up to £5m available for projects seeking funding of between £100,000 and £1m; and

a Transform stream that will make up to £30m available for projects seeking funding of between £1m and £10m.

Ofwat said it intended to review its current innovation fund policies more fully towards the end of the pilot period which ends in March 2022.