Strategic Innovation Fund

Indus

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What the project is about How we’re doing it What makes it innovative What we’re learning Reports & Documents

Project Data

Start date:

10/02/2023

End date:

03/29/2024

Budget:

£551,953

Summary

Indus aimed develop a framework for creating zero-carbon industrial parks, supporting the decarbonisation of small and medium-sized, dispersed industrial sites. It sought to enable better coordination of electricity network upgrades, ultimately reducing costs for both industrial site owners and electricity customers.

What is the project about?

According to HM Government and the DESNZ Net Zero Strategy, UK industrial emissions total approximately 78 MtCO₂e — around 15% of the nation’s total greenhouse gas emissions. Notably, half of these emissions come from small and medium-sized dispersed industrial sites, for which there is currently no coordinated government plan for decarbonisation.

Decarbonising industry at scale will require substantial reinforcement of the electricity network. However, a lack of coordination, incentives, and visibility among electricity networks, local authorities, and industrial operators is expected to create several challenges:

  • Delays in industrial decarbonisation
  • Suboptimal network upgrades and infrastructure investments
  • Increased costs passed on to network users

Additionally, limited coordination within the industrial sector itself tends to drive up the capital costs of onsite decarbonisation infrastructure.

How we’re doing it

Throughout the project, the team engaged with a broad range of stakeholders, including Distribution Network Operators (DNOs), Independent Distribution Network Operators (iDNOs), Independent Connection Providers (ICPs), Gas Distribution Networks (GDNs), Local Authorities (LAs), the National Energy System Operator (NESO), industrial businesses, and others involved in industrial decarbonisation. These engagements provided valuable insights into the challenges these stakeholders face in decarbonising industrial sites.

The insights gathered informed the criteria and scope for developing a commercial framework and potential arrangements to support zero carbon industrial hubs. The project also examined how DNOs and LAs could more effectively integrate industrial decarbonisation into their strategic planning cycles.

In addition, the project identified a potential implementation site — Lotus Cars and the Hethel Engineering Centre — for the Beta Phase, where the Indus solution could be demonstrated. For this site, the team developed a technical decarbonisation solution and an associated investment case, illustrating how the site could realistically achieve Net Zero.

What makes it innovative

Indus explored a largely underexamined approach to industrial decarbonisation, offering a way to streamline the process by adopting a whole-system perspective. The project proposed clustering dispersed small to medium-sized industrial businesses into zero carbon industrial hubs, enabling coordinated decarbonisation through shared infrastructure and planning.

Without such coordination, there was a clear risk of uncoordinated and inefficient business and infrastructure investment, potentially leading to stranded assets or missed Net Zero targets.

The latest phase of the project demonstrated that the Indus solution could avoid the need for network reinforcement compared to a counterfactual scenario of uncoordinated electrification. It also showed potential to deliver both capital expenditure (CAPEX) and operating expenditure (OPEX) savings for industrial customers.

What we’re learning

Indus revealed several key insights critical to decarbonising small and medium-sized dispersed industrial sites:

  • Effective data sharing between DNOs, GDNs, industrial customers, and LAs is crucial. Data sharing agreements are essential for accurate forecasting and the success of the Indus solution.
  • Identifying and forecasting how industries could decarbonise is vital for industries joining decarbonisation clusters, with GDNs and DNOs playing a significant role. Continuous and early engagement is necessary from the initial identification of potential cluster participants to the development of these clusters, involving all stakeholders, including coordinating authorities like NESO.
  • A coordinating authority is essential for the effective formation and management of clusters. While the commercial solution assigns this role to Regional Energy System Planners (RESPs), further validation is required.
  • Access to diverse funding options is crucial for Indus businesses to finance their decarbonisation efforts.
  • Coordinated planning through the Indus solution is expected to deliver a 27% reduction in required reinforcement which translates to £190m in cumulative savings across GB by 2050.

We also identified a critical gap in data sharing between stakeholders in the energy sector which we are exploring in a follow-on project, which will enable further testing of the Indus solution.

Reports & Documents

SIF Discovery Round 2 - Indus Project Registration
SIF Round 2 Discovery - Indus Show and Tell
SIF Round 2 Discovery - Indus End of Phase
SIF Alpha Round 2 - Indus Project Registration
SIF Alpha Round 2 - Indus Mid Point Review Meeting
SIF Alpha Round 2 - Indus Show and Tell
SIF Alpha Round 2 - Indus End of Phase Report
SIF Alpha Round 2 - Indus Close Down Report
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