Strategic Innovation Fund Challenges: 2026 to 2033
Summary
Ofgem has endorsed five innovation challenges for the Strategic Innovation Fund covering RIIO-3 transmission (2026-2031) and electricity distribution (2028-2033): six-month industrial connections by 2033, 50% faster and 20% cheaper build by 2035, plug-and-play domestic device connections by 2032, near-zero outages via autonomous islanding by 2038, and decentralised local balancing by 2034. The challenges were recommended by the Energy Networks Innovation Taskforce and will be delivered through Innovation Delivery Groups and SIF-funded projects. This document sets the target framework; it does not allocate funding or change rules.
Why it matters
The targets describe the symptoms Ofgem wants fixed (slow connections, expensive build, outages, queue-based balancing) without addressing the incentive structure that produces them. Networks are paid a return on capital invested, not on throughput delivered or connections energised; an innovation fund layered on top of that incentive will produce demonstration projects, not systemic change. The six-month industrial connection target by 2033 is the most consequential because it implicitly concedes that the current connection regime is the binding constraint on industrial investment, but the mechanism to deliver it is left to future Innovation Delivery Groups rather than charging reform or queue pricing.
Key facts
- •Five innovation challenges endorsed by Ofgem, recommended by Energy Networks Innovation Taskforce
- •Challenge 1: six-month energisation for major strategic industrial sites by 2033
- •Challenge 2: 50% faster, 20% cheaper network build and maintenance by 2035
- •Challenge 3: instant plug-and-play connections for domestic energy devices by 2032
- •Challenge 4: near-zero interruptions via autonomous reconfiguring and islanding by 2038
- •Challenge 5: autonomous local balancing and optimisation by 2034
- •Covers RIIO-3 transmission price control (2026-2031) and electricity distribution (2028-2033)
- •Delivery via Innovation Delivery Groups and SIF governance under RIIO-3
Timeline
Areas affected
Related programmes
Memo
Strategic Innovation Fund Challenges: 2026 to 2033 | Ofgem Please enable JavaScript in your web browser to get the best experience. BETA This site is currently in BETA. Help us improve by giving us your feedback . Close alert: Strategic Innovation Fund Challenges: 2026 to 2033 Publication type: Guidance Publication date: 13 May 2026 Topic: Innovation Subtopic: Strategic Innovation Fund Print this page Share the page Share on Facebook Share on Twitter Share on LinkedIn Details the 5 innovation challenges that need to be met during the price control period 2026 to 2031 and electricity distribution 2028 to 2033. Details Challenge 1: Industrial and business connection acceleration - major new strategic industrial sites can be energised and operational within six months by 2033 Challenge 2: Faster build and maintenance - 50% faster, 20% cheaper network build and maintenance by 2035 Challenge 3: Instant use domestic energy devices - enable instant, plug-and-play connections of domestic energy devices and appliances by 2032 Challenge 4: Eliminating energy outages – near-zero interruptions via autonomous reconfiguring and islanding of any section of the network by 2038 Challenge 5: Decentralised system balancing - deliver products and services to prove the viability of autonomous local balancing and optimisation of networks at every level by 2034 These five innovation challenges were recommended by the Energy Networks Innovation Taskforce and endorsed by Ofgem. The next step is to meet these Innovation Challenges through Innovation Delivery Groups and future innovation projects, as per the Strategic Innovation Fund (SIF) governance for RIIO-3. Note: some of the files attached below are not fully accessible. If you require an alternative format, please contact networks.innovation@ofgem.gov.uk . Documents Networks reimagined: Designed to deliver for customers and growth 2026 [PDF, 5.74MB] Networks reimagined: Designed to deliver for customers and growth - Report Annexes [PDF, 1.36MB] Print this page Share the page Share on Facebook Share on Twitter Share on LinkedIn Close