Climate Innovation Pull Facility (CIPF)

The UK Department of Energy Security and Net Zero is exploring the development of a new facility - the Climate Innovation Pull Facility.

Through pull finance, this facility will support innovation, scale up and market building for climate change mitigation solutions for developing country contexts, focusing on innovative clean energy technologies and business models in a small number of specific applications/sectors, where the evidence shows support is most needed.

The planned facility is up to £185m and is part of the Department's International Climate Finance portfolio and funded with Official Development Assistance (ODA).

In public innovation financing, "pull mechanisms" create incentives for innovators and other actors by creating viable market demand.

They seek to reduce viability gaps and induce innovation by signalling demand for solutions to specific problems.

Mechanisms often cited include Advanced Market Commitments, Results or Outcomes Based Financing, Prizes/Challenges, innovation bulk procurements, Contracts for Difference, among others.

By contrast, much innovation support has to date utilised "push mechanisms" directly subsidising up-front R&D costs.

In terms of climate mitigation solutions, the Facility will have a particular focus on clean energy innovation themes.

The work being explored would be linked to the Ayrton Fund commitment to support clean energy research, development and demonstration (RD&D), as part of the wider UK commitment to tackle climate change.

Examples of Ayrton Fund thematic challenges are set out on gov.uk.

The procurement of this requirement will be in two parts: i) A contract for a Facility Manager to manage the programme, source, develop, commission and oversee 6-8 climate pull projects of £10m - £50m each.

This contract will also cover programme monitoring and learning. ii) A separate contract for an Independent Evaluator of the programme, who will conduct a mid-term and end-of-term evaluation of the programme's achievement of its development objectives, theory of change and value for money.

This element of the scope will be discussed briefly at the EME in September with further detailed engagement to follow on the procurement of this contract.

The procurement will be run under the provisions of the Procurement Act (2023) and is most likely to be a Competitive Flexible Procedure.

Further information will be provided at the event.