UKRI is offering grants of up to £750k to help UK businesses turn an early-stage underground hydrogen storage concept into an investment-ready demonstrator project.
The competition funds project development studies for underground hydrogen storage (UHS) demonstrators that can store hydrogen and release it for at least 100 continuous hours. There is up to £1.5 million available from UKRI’s R&D Missions Accelerator Programme, and UKRI has earmarked up to £10 million more for a potential follow-on demonstrator, although no decision on that funding has been made yet.
Below, I have explained the key things you need to know about this competition before you apply: who is eligible, how much funding is on the table, and what the application process looks like.
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Who is Eligible?
Your Organisation
To lead a project, you must be a UK registered business of any size. You can apply on your own or lead a collaborative project involving multiple organisations.
The following UK registered organisations can join your project as collaborators:
- Academic institutions
- Businesses of any size
- Charities
- Not-for-profit organisations
- Public sector organisations
- Research and technology organisations (RTOs)
Academic institutions can’t lead a project or apply on their own. In a collaborative project, you and at least one other organisation must request funding, and each organisation can only lead one application.
Your Project
Your project must:
- Have a total grant request of between £200,000 and £750,000
- Last between 6 and 12 months
- Start by 1 April 2027 and end by 31 March 2028
All funded work must be carried out in the UK, and you must intend to exploit the project results from or within the UK.
Your project must also:
- Be a first-of-a-kind development in the UK, rather than a business as usual commercial project
- Be designed and specified for hydrogen service, with a defined pathway to dedicated hydrogen storage
- Be linked to one or more credible hydrogen offtake routes, like power generation, industrial use or hydrogen transmission
- Demonstrate that your team can take the project through to final investment decision (FID), construction and operation
- Identify a specific site and show a credible route to securing land access, consents and permits
- Involve a demonstrator facility that can inject, store and withdraw hydrogen underground within safe operating limits
- Target 10 to 100 MWh of hydrogen working gas capacity, with a credible pathway to commercial, GWh-scale deployment in the UK by 2035
Your demonstrator must be able to discharge for at least 100 continuous hours, and you should aim for initial deployment at megawatt hour scale by 2030.
UKRI takes a technology neutral approach, but your project should use one of these storage types:
- Depleted gas fields
- Depleted oil fields
- Engineered lined rock caverns
- Engineered lined shafts
- Novel salt caverns
- Subsurface silos or vertical pipe arrays
Novel salt cavern projects must show real technical or system innovation beyond conventional salt cavern development. If your technology isn’t on this list, contact UKRI before you apply.
Your study must take the project from an early-stage design (FEL-1 or FEL-2) to a completed FEL-3 engineering basis, and cover:
- Commercial viability
- Front end engineering design (FEED) level engineering definition
- Hydrogen supply and offtake arrangements
- Planning, consenting and regulatory progress
- Project execution and procurement planning
- Robust cost and schedule definition
UKRI won’t fund projects that are:
- Focused on above ground storage, linepack or transportable storage as the main storage solution
- Focused on hydrogen carriers or derivatives, like ammonia, methanol or synthetic methane
- Focused on laboratory scale or early-stage discovery research
- Focused primarily on hydrogen production, transport or end use, rather than storage
- Focused solely on technology testing, without a credible site and demonstrator proposition
- Limited to individual materials, components or subsystems that aren’t part of a site-specific UHS project
- Routine development work that would go ahead at the same scale and pace without public funding
How Much Funding Can I Apply For?
The amount you can claim depends on your organisation’s type and size and the sort of research your project involves.
Individual grants range from £200k to £750k.
Applying as a Company
| Project Type | Micro and Small | Medium | Large |
|---|---|---|---|
| Percentage of Costs Covered* | 70% | 60% | 50% |
*This competition funds feasibility studies, which analyse a project’s potential to support decision-making by uncovering its strengths, weaknesses, opportunities and threats.
Funding Example
If you’re a medium-sized company with £1 million of eligible project costs, you could receive a grant of £600,000.
You will need to fund the remaining £400,000 from other sources, like R&D Tax Relief, investment or loans.
Applying as a Non-Commercial Organisation
Research organisations doing non-economic work can share up to 30% of the total eligible project costs and are funded at higher rates:
- Up to 100% of eligible costs if you are a charity, not-for-profit, public sector organisation, research organisation or RTO
- Up to 80% of full economic costs (FEC) if you’re an academic institution, like a university
How Do I Apply?
The deadline for applications is 13 January 2027.
Applications are submitted via Innovate UK’s Innovation Funding Service (IFS) portal.
The application is split into four sections:
Project Details
This section gives the assessors background on your project and isn’t scored. It covers your:
- Application details, like your project title, start date and duration
- Application team
- Project summary
- Public description
- Research category
- Scope, including your storage technology, capacity, site and current design stage
Most answers in this section are limited to 400 words, although the scope answer can run to 600.
Application Questions
There are 15 questions in total:
- Seven unscored questions covering topics like permits and licences, international collaboration and your chosen storage technology
- Eight scored questions covering your route to a demonstrator, current project maturity, cost and schedule, commercial potential, barriers and risks, team, project management, and UK economic and supply chain benefits
Several scored questions need appendices, including a Master Deliverables Register, a DEVEX and CAPEX cost breakdown, a project plan and a governance chart. You can also add letters of support to the team question.
Finances
Each organisation in your project enters its own project costs, organisation details and funding details.
Project Impact
Every partner completes a short set of unscored Project Impact questions before you can submit.
Your application will be reviewed by five independent assessors. Their individual scores will be combined to determine your final result.
If you’re successful, you’ll be notified by 13 February 2027.
Like with most competitions, UKRI takes a ‘portfolio approach’ by funding projects across different technologies, markets and technological maturities. This means that a strong score won’t necessarily guarantee that your application will be successful.
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