Funding to develop innovative trials of net zero carbon approaches to road construction and maintenance will be offered to up to ten small to medium sized businesses in a competition launched today by National Highways and Connected Places Catapult.

Phase one of the National Highways Accelerating Low Carbon Innovation Programme will see winning UK based firms awarded between £15,000 and £30,000 each to develop feasibility studies in collaboration with the strategic road operator and its tier one suppliers.

Phase two will see further funding of up to £80,000 provided to support a selected number of organisations to trial their solutions.

Applicants are invited to put forward proposals that address at least one of three challenges:

• Development or application of alternative materials and techniques;
• Innovations that can improve asset management decision-making;
• Innovations which can contribute to reusing, redeploying and recycling construction materials and assets.

There is also an open challenge category for other ideas that can contribute to National Highways’ target of zero emissions in maintenance and construction by 2040.

Up to five larger tier one organisations will also be selected to develop net zero solutions either on their own or in collaboration with an SME, but will not be eligible for funding as part of the programme.

Firms interested in putting themselves forward for the competition have until midnight on 30 April to enter.

The aim of the competition is to reach a wider pool of innovators, exploring firms with potential outside of National Highways’ existing supply chain, that promise to make a difference in lowering its carbon footprint.

The innovation accelerator seeks to take new materials and solutions described as being ‘low maturity’ and put them through a consistent, standardised process of prioritisation, feasibility and initial trialling, with the aim of assessing viability for wider testing and adoption.

Successful firms will be offered coaching and help with marketing strategy and investment support, as well as trial design training, deployment support, trial monitoring and evaluation. There will also be the chance to take part in a demonstration day for investors, industry and potential customers and ten months’ tailored business support.

About the project 

To limit warming to 1.5C, it is critical businesses set decarbonisation targets to include emissions occurred across the full value chain, beyond what they have direct control over. These emissions are referred to as Scope 3 and are often the most significant, but most difficult to accurately measure. It is important that an accurate image of the true embodied carbon is captured in Scope 3 emissions in order to inform and drive change required to meet net zero. 

However key challenges for manufacturers to capture their value-chain emissions include:  

• An overabundance of standards, tools, guides and frameworks means the landscape is hard to navigate for most companies without the help of experts in the field. 
• Hard-to-access, inconsistent and unverified data leads to inaccuracies and discrepancies in carbon accounting leaving a large room for error and reduced customer confidence. 
• A lack of policies, good governance and enforcement leads to a broad range of practices and varying levels of adherence. 

A systematic approach is therefore required to tackle this complex set of challenges. 

Catapults take action 

With this in mind, the High Value Manufacturing Catapult is leading a two-and-a-half-year project on behalf of Innovate UK with support from several other Catapults to develop a framework for creating a best practice guide for measuring embodied emissions of UK products in the context of Scope 3 greenhouse gas reporting. The four other Catapults involved in the project are Connected Places, Digital, Energy Systems and Satellite Applications, each leveraging their network and unique expertise to tackle this complex challenge. 

Connected Places Catapult is leading the ecosystem work by mapping the complex landscape, convening broad subject matter experts and identifying solutions and best practice. Digital Catapult is leading the work on data, tools and verification. Energy Systems is building on its experience driving carbon reporting frameworks to build tools and best practice for tracking emissions along supply chains and disseminating into industry.   

The programme will work closely with selected companies in the UK manufacturing supply chain to test and validate their carbon accounting processes, in order to support them on their carbon accounting journeys and to gather best practice knowledge for the project. 

The Catapult Network will also work alongside external subject matter experts such as the British Standards Institution, which has delivered a series of recommendations on how to improve governance and standards associated with carbon accounting. 

Opportunity 

Making progress on industrial emissions reduction in not only key to meeting Net Zero, but will also boost the competitive advantage of UK manufacturers to win future work as other nations adopt carbon pricing. 

The UK has the opportunity to position itself as the global ‘green-shoring’ destination of choice for manufacturers, underpinned by a decarbonised industrial base and clear greenhouse gas accounting and reporting frameworks.   

Rather than offshoring our manufacturing supply base to nations with weaker carbon reduction targets, the UK has an opportunity to take a global leadership position. It can address its consumption emissions by transforming its domestic manufacturing base, anchoring innovations, attracting inward investment and exporting Net Zero products and services to international markets. 

Call to action 

We cannot solve this in isolation. So if you have a solution or recommendation you would like to share, or if you have first-hand experience of these carbon reporting challenges and want to participate in pilots, please get in touch via the contact details below. 

Contact the project team 

For more information on this project, complete the form below and a member of our team will be in contact.

Project partners

Interested in net zero investment opportunities in the transport and built environment sectors? Join Connected Places Catapult at their Shard Investment Day to hear from Innovative UK SMEs who are working to address net zero challenges.

For investors, this event will provide an opportunity to be introduced to high-potential SMEs with net zero projects. It will also offer an insight into the demand for projects presented and help open a dialogue to ensure the right investment decisions are made.

The event will also provide an opportunity for local authority and other relevant stakeholders to hear from firms at the forefront of net zero innovation.

If you are an investor, represent a local authority or other stakeholder and would be interested in attending, please apply now to reserve your spot.

SMEs looking to take part should apply via our opportunity page

Connected Places Catapult is developing an exciting new programme working with our strategic global partner ICLEI South America and the governments of Guadalajara (Mexico), Buenos Aires (Argentina), Campinas (Brazil) and Monterrey (Mexico). The programme will develop long-term business-led research and innovation collaborations between these cities and the UK to address city-level challenges related to climate change and resilience utilising UK expertise.

Funded by the UK Department of Business, Energy and Industrial Strategy (BEIS) via the Science and Innovation Network, this programme will identify local net-zero and resilience weaknesses and form challenge calls with local partners to create collaborations merging local and UK expertise. The programme will then seek to test these solutions in a real-world environment and create a platform to expand these solutions with funding from local development banks and the private sector.

More specifically, the programme will:

1. Work with four Latin American partner cities, to further refine their current sustainability challenges. With Monterrey, the focus will be on water resilience.
2. Select UK and local companies with solutions that can support the cities in tackling identified challenges
3. Support UK and local businesses in exploring synergies between their solutions and incentivise them to explore internationalisation opportunities.
4. Create the foundations for co-development and testing of the solutions in a real-world environment in the four selected geographies.
5. Work with three observer cities to develop or expand on their existing net zero , which analyse the urban innovation response of each city to climate issues.

The vision is to support the cities in their journey towards net zero, create more opportunities for bilateral trade, investment, and equitable and inclusive economic growth.

Challenges:

• Buenos Aires – Last-mile logistics
  Optimise last mile logistics to meet increasing demand for deliveries and reduce the number of freight vehicles in the city centre.
• Metropolitan Area of Guadalajara – Mobility
  Improve the public transport service by enabling data-driven solutions to provide real time information.
• Campinas – Mobility / Last-mile logistics
  Enable data-driven transport planning and services to encourage a transition to sustainable transport modes.
• Monterrey – Water resilience
  Implement changes and solutions that improve the city’s water resilience.

To find out more about the programme, register for the webinar.

This article features in issue two of Connected Places magazine.

Cities are responsible for over 70% of global energy-related carbon emissions yet cover only 3% of the Earth’s surface. They are already home to more than half the world’s population and by the end of the century that will be closer to 80%. Our cities are the engine rooms of national and global economic activity – vibrant, chaotic melting pots of trade, culture and innovation.

Yet cities are the places where so many of humanity’s greatest challenges play out too – from warfare and social unrest to economic shocks and severe weather events. So it’s not surprising that cities are grabbing our attention more than they did only a few short decades ago.

Because if temperature rises stay on their current trajectory, and both the Paris Agreement and 2050 net-zero emissions targets are not met, the outlook is bleak. According to the Swiss Re Institute, without action over the next 30 years global temperatures could rise by 3°C and the world economy could shrink by 18%. The scale of investment required to mitigate that scenario is eye-watering. It is estimated that $4 trillion per year in infrastructure investment is needed in developing countries alone.

Yet adapting to the climate crisis also has its opportunities. The New Climate Economy for instance has estimated that bold action could result in a direct economic gain of $26tn by the 2030s.

Either way, without finance, cities will not achieve a green transition at the scale and pace required. One of the problems is that cities vary significantly in their ability to attract new finance for low-carbon infrastructure. Cities the world over struggle to access private investment. This is often due, among other challenges, to institutional capacity, limited taxation powers, and the constraints of national policies.

The World Bank Group has estimated that among 500 large cities in developing countries only 5% have credit ratings that are recognised on international capital markets. According to the C40 Cities Finance Facility, only 0.8% of the capital managed by pension funds, sovereign wealth funds, insurance companies and other institutional investors is currently allocated to infrastructure.

So as cities themselves are grabbing our attention more, the question of how to finance the transition to a low-carbon economy is also grabbing the attention of those who lead them.

One of the ways in which that question is being answered in the UK is through the Cities Commission for Climate Investment (3Ci). It was established, with the support of the UK Government, to address these challenges of collaboration and scale head-on. A joint initiative between the Connected Places Catapult, Core Cities, and London Councils, 3Ci is a coalition of 12 of the UK’s largest cities working together with the wider local government sector and the M10 mayoral group to tap into new ways of securing private investment into place-based net-zero infrastructure.

What 3Ci has found is that, by aggregating the low carbon investment plans of the UK’s largest cities – worth an estimated £330bn – it’s possible to create a more attractive and substantial proposition for investors. Projects include the retrofit of homes and commercial properties, integration of renewable energy, shifts to sustainable transport, circular waste management, and improvements to green spaces and waterways.

Local authorities, even large cities, tend to lack the in-house skills and expertise for the scale of the net-zero investment challenge. So 3Ci is creating a national technical assistance programme to grow the skills base for investment. On the ground a series of geographically diverse pilots will help test and demonstrate the delivery of new financial models that can aggregate opportunities across different sectors and facilitate investment at scale.

Longer-term plans include a development fund to secure £100bn of financing, as well as an investment fund to provide capitalisation worth £200bn, contributing a 10% increase in Gross Value Added and 10,000 new jobs across the supply chain.

The work of 3Ci is in response to the rise of innovative finance in cities – new experiments in combining technical innovation with policy, regulation and bespoke finance instruments to create new ways to fund net-zero infrastructure.

It would be tempting to think that this is mostly a question of how to raise money for a city’s existing spend requirements, for example a project that has a funding gap. It is true of course that cities are now experimenting with new blends of public and private finance, debt and equity, as well as mixing infrastructure investments into portfolios of tradable assets. Performance-based green bonds are being tested where the return to the investor is directly correlated to the impact achieved and the cost of debt then falls as targets are met.

It’s also true that there is a growing appetite for community investment structures where citizens can invest in new infrastructure in their own areas. This is where financial tools can enable a local culture of innovation to develop around the low-carbon economy. Fostering local entrepreneurialism can be a practical way of recognising that municipalities may not have the answers, but the start-up and social enterprise sectors may well do. This is where angel investment funds and equity stakes can support successful start-ups in ways that align them with the city’s own climate objectives, while generating a return so that capital can be reinvested.

But while all of these new finance tools are important, in the long term cities also need to be thinking more innovatively at the project design stage. Designing projects that are fit for private investment from the get-go, and in ways that will maximise their chances of getting funded is crucial.

A powerful way of doing that at scale is for cities to join forces. To support this, 3Ci is developing a National Net Zero Project Pipeline of local and regionally led bankable projects. This has been informed by a series of regional investor forums that have brought cities and local governments together – often for the first time – with investors to showcase opportunities and build confidence and trust.

In many cases, the technical solutions are largely known and are already being successfully financed and implemented at the local level. The aim is to demonstrate the level of public and private investment required across the UK, and where opportunities might lie for scaling.

Nationally, the UK is aiming for 55% of vehicles on its roads to be electric by 2032. But the London Borough of Hackney plans to smash that target by aiming for a 90% uptake by 2030. This is already being facilitated by a rapid roll out of electric vehicle (EV) charge points from around 300 council-owned points today to 3,000 (at least one per estate) by 2030.

The charge points will be powered from 100% renewable sources and in some cases locally generated. But they will also be sustainable in another sense because the scheme is projected to raise more than £9m in income for the council.

Councillor Mete Coban MBE serves as Hackney’s Cabinet Member for Energy, Waste, Transport and Public Realm. For him, the scheme is helping local residents make the green transition easier while complementing other projects to promote active travel and electrify the Council’s own fleet of vehicles.

“These new charging points will help reduce the concerns some people have about switching to an electric vehicle,” he says. “In turn, this will benefit all of our residents as it will also help enhance the borough’s air quality.”

The City of Belfast has a thriving innovation economy centred around its Titanic quarter. The Council and Artemis Technologies have launched the world’s first 100% electric foiling workboat which is creating new, low-emission ways of moving goods and people across its waterways. The Belfast Maritime Consortium is also now developing a high-speed zero-emission electric hydrofoil ferry, with the first vessel expected to launch as a pilot ferry service between Bangor and Belfast in 2024.

The speed of this development highlights the advantages of bringing together place leaders, investors and inventors. Clare Guinness is the Belfast Innovation District Director and for her it’s an example of how Belfast is punching above its weight and a testament to the power of place-based innovation and collaboration:

“With the talents of Artemis Technologies”, she says, “an anchor tenant in Belfast’s thriving Innovation District, and its revolutionary range of green sea vessels, the city is once again set to be at the forefront of global change, and we couldn’t be prouder.”

3Ci is a first for the UK and it is already attracting attention from around the world. The Commission is also now creating a wider partnership, including UK Government, Innovate UK, Metro Mayors, Combined Authorities, Scottish and Key Cities, Counties and Districts and a growing league of private investors, financiers, advisors, developers and built environment technology professionals.

Want to find out more about 3Ci?

This article features in issue two of Connected Places magazine.