Frequently Asked Questions

Find answers to commonly asked questions.

1. About the Innovation Fund

We consulted on our draft themes, including in our May 2020 consultation. We received over 50 responses to this consultation, following which we made some adjustments to the draft themes. Details on the consultation responses and our final themes can be found on the Ofwat website.

The Innovation Fund is funded by water and wastewater customers in England and Wales. This includes the funds for both the Innovation in Water Challenge and the Main Competition.

Part of the exciting thing about these competitions is forming new partnerships. We know that it’s not always easy for organisations to find collaboration partners in the sector, but both Ofwat and water companies will work to improve this through what we learn from successive rounds of the competitions and as new collaborations are developed. The sector is also developing material to further illustrate where the sector’s supporting needs are.

There is also significant value in making knowledge sharing and learning collaborative. We hope developments such as the creation of the sector’s proposed centre for excellence, will play an important role here. You can find out more in the UK 2050 Water innovation strategy, produced by an alliance of 19 UK water companies.

The innovation fund is one route to funding innovative projects. We recognise that there are many other opportunities available, including the role of UKWIR in facilitating research.

There may be opportunities to further develop UKWIR research through the innovation fund if it can demonstrate benefits to water customers in England and Wales, for example, through sector rollout.

The five strategic innovation themes set out the big challenges facing the sector, which would benefit from additional innovation.

Through the competitions, the Innovation Fund will support initiatives that can deliver significant value for customers, society and the environment aligned with one or more of these themes. We consulted on these themes in May 2020 and made changes as a result – please see details of the consultation here. Our final strategic themes were published in our policy decision document in August 2020.

The Innovation Fund is looking to encourage new ways of working across the water sector, in particular, increasing and improving collaboration and building partnerships both within and outside the sector.

We’re looking for initiatives that water companies and NAVs would not otherwise be able to explore or invest in. We’re looking for all types of entries – be they technology, methodologies and approaches, culture, business practices, commercial models or something else. Initiatives can be at any stage, as can the technologies, methods and models that you may use within them.

We provide more information on what we are looking for on our Innovation in Water Challenge website here. As part of our assessment criteria, we expect entries to demonstrate how their proposal considers our innovation enablers and solutions, which we see as key to transformational innovation.

We’re looking for initiatives that water companies and NAVs would not otherwise be able to explore or invest in. We’re looking for all types of entries – be they technology, methodologies and approaches, culture, business practices, commercial models or something else. Initiatives can be at any stage, as can the technologies, methods and models that you may use within them.

We’re looking for initiatives that water companies and NAVs would not otherwise be able to explore or invest in. We’re looking for all types of entries – be they technology, methodologies and approaches, culture, business practices, commercial models or something else. Initiatives can be at any stage, as can the technologies, methods and models that you may use within them.

Yes, the themes will be the same for the main competition. However, we may decide to focus future competition rounds on a particular theme.

2. The Innovation in Water Challenge (IWC)

Ofwat have selected Nesta Challenges, supported by Arup and Isle Utilities, as delivery partners for the IWC.

Nesta is an innovation foundation. Within Nesta, Nesta Challenges uses challenge prizes to stimulate innovative solutions to some of the biggest challenges we face. Challenge prizes are a simple but powerful idea. A problem or opportunity is identified, the challenge is publicised, and rewards are offered to those who can deliver the best solutions.

Arup is an independent professional services firm of designers, planners, engineers, architects, consultants and technical specialists.

Isle is a technology and innovation consultancy.

The application form will be available from 18 January 2021 when the challenge opens for entries. You will have six weeks to complete this application form during the entry period.

We recommend you use the assessment criteria to guide conversations with potential partners.

The terms and conditions will be available from 18 January 2021.

Contractual matters between members of a partnership are the responsibility of those involved in any partnership.  There is no expectation that organisations will have entered in contractual agreements that would be dependent on winning IWC funding until after you successfully won it.

3. IWC Timelines

The first round IWC will open from 18 January 2021, with successful entries informed by April 2021. The second round of the IWC is expected to launch in November 2021, with successful entries notified in early 2022. We expect future rounds to continue until 2025.

Please note, future rounds of the IWC may be designed differently.

Currently, the first two rounds of the IWC have been planned, but we expect future rounds to continue until 2025. Each round of entries to the IWC is likely to run for three months.

The first round of the IWC will open for entries from 18 January 2021. The entry period will last six weeks, until 12 noon (GMT) on 26 February 2021. Successful entrants will be informed they have been awarded funding by April 2021.

You need to enter the IWC via an online form during the entry period from 18 January 2021 until 12 noon (GMT) on 26 February 2021.

After the entry period ends, the entries will be assessed by an independent judging panel in late March 2021. If you are successful in winning funding, you will find out by April 2021.

You can then plan for your initiative to go ahead.

4. Who can enter the IWC

No – any organisation can enter the IWC in partnership with one of the 17 licensed regional water and wastewater companies or new entrant water and wastewater companies (NAVs) in England and Wales. However, entries must be led by one of these companies.

The  17 licensed regional water and wastewater companies or new entrant water and wastewater companies (NAVs) in England and Wales can submit entries without a partner, but we strongly encourage entering as part of a partnership or consortia.

In the first instance, we are restricting direct access to water and wastewater companies and NAVs in England and Wales. This is because the innovation fund is funded by water customers. We have committed to keeping eligibility under review and will continue to assess the risks and benefits of broadening out eligibility.

As a water retailer, you are able to enter the first round of the IWC as part of a partnership or consortia led by one of  17 licensed regional water and wastewater companies or new entrant water and wastewater companies (NAVs) in England and Wales.

We have committed to keeping the eligibility of the Fund under review during the pilot period (running until March 2022) and will draw evidence from each round of the competition to inform any change in our current position.

We welcome any types of partnerships, but we strongly encourage looking for new partnerships to apply to the IWC. Successful entries will provide evidence to the judges to demonstrate the strength of collaboration arrangements through the entirety of the initiative or project life cycle.

Ofwat have been clear that they expect water companies to improve their accessibility for potential partner organisations. You can find links to all the companies’ innovation pages on our website to help you contact a company.

The sector is currently developing supportive materials to highlight areas of interest and which companies to contact, this should be made available soon. We encourage you to reach out to water companies not only in relation to ideas and projects you are considering for the first round of the IWC launching in January 2021 but also in preparation for future competitions (both future IWC rounds and the main competition).

If you’re new to the water sector, you may wish to email contact@waterinnovation2050.org.uk to get in contact with a water company about your innovative idea or solution. This central inbox is managed by an alliance of 19 UK water companies.

Please use the following links to view the full list of organisations eligible to enter as a lead applicant:

Although we encourage building new partnerships, organisations that have already worked together are welcome to enter.

We have not set out a preferred make up of partnership/consortia as we do not want to restrict any opportunities at this stage. Entries will be assessed against the assessment criteria, as set out in the Entrant Handbook.

It is unlikely that more than three applications from the same lead water company will be successful in receiving funding. However, involvement in multiple entries where a water company is not the lead but supporting another lead water company should not affect the chances of success of an entry

We would expect organisations to be a registered legal entity, but any organisation of any size can enter as a partner with one of the 17 licensed regional water and wastewater companies or new entrant water and wastewater companies (NAVs).

Yes, organisations from countries outside of England and Wales are welcome to enter in partnership with one or more of the 17 licensed regional water and wastewater companies or new entrant water and wastewater companies (NAVs).

Yes, organisations from countries outside of England and Wales are welcome to enter in partnership with one or more of the 17 licensed regional water and wastewater companies or new entrant water and wastewater companies (NAVs). The Ofwat Innovation Fund is funded by customers in England and Wales, which is why for this round, entries are not able to be led by water companies in other UK nations or other countries.

We particularly encourage entries involving partnerships and collaboration between two or more of:

We do not have any preference on the number of partners, location of partners, size of partners, years of operation, or the number of water companies vs other partners other than that the partnership should be appropriate for the delivery of the entry. Part of the assessment criteria focuses on the entry’s capacity and capability to deliver.

We are aiming to make sure the application process is as efficient and practical as possible, ensuring ease of access for organisations, in particular smaller companies.

As a guide, we would not expect it to take you more than half a day to complete the application form.

Teams can submit as many entries into the challenge as they like, providing each entry is for a different initiative. It is unlikely, however, that funding will be awarded to more than three entries with the same lead applicant.

Water companies outside of England and Wales are welcome to enter as a partner with one or more of the 17 licensed regional water and wastewater companies or new entrant water and wastewater companies (NAVs).

The lead applicant (a water company or a NAV) will receive the funds and be subject to the terms and conditions of the funding.

It is then a contractual matter between members of a partnership on their own legal agreements, how the funds and responsibilities will then be split and allocated between different parties within the partnership. This also applies where there is a consortium of water companies.

Academia and Universities are welcome to enter as a partner with one or more of the 17 licensed regional water and wastewater companies or new entrant water and wastewater companies (NAVs). This is not a requirement for an entry.

You can contact water companies directly, we have included all company contact details on the Find a partner page. 

5. Your Project or Initiative for Entry to the IWC

Yes, providing the initiative is not a business-as-usual activity and makes it clear how additional funding will deliver additional value to customers, society and the environment in line with one or more of our strategic innovation themes, the Innovation in Water Challenge can support kick-start, grow or scale your initiative. We want to see proposals, old or new, that meet or strengthen our innovation enablers, such as collaboration, openness and scalability which we believe are, and will continue to be, critical to growing the sector’s capacity to innovate.

Additionally, it must be clear that there is no duplicative or double funding, e.g. projects funded through PR19 or through other organisational investment, public or private funding.

Yes, if an entry is unsuccessful, then it can be resubmitted to a later competition, having considered any feedback given.

We are also open to companies using later competition rounds to further the development of a previously successful entry – subject to evidence and assurance that there is no double funding.

We’re looking for all types of entries – be they technology, methodologies and approaches, culture, business practices, commercial models or something else. Initiatives can be at any stage, as can the technologies, methods and models that you may use within them. Due to this, we are not providing a specification based on the Technology Readiness Level (TRL) scale.

However, we do expect that solutions reach the ‘prototyping’ stage over the course of the project – that is, be implementing and testing some component of their solution with real users.

Yes, we are open to companies proposing gates aligned with project phases and risks. This is something the applicant can include in their application.

We would expect initiatives entered into the first round of the IWC to start or continue within 2021; however, we recognise that entries will vary in duration beyond the start date.

Entries should include details of appropriate delivery timescales of the entry, along with when customer, society and environmental value will be realised.

Across all the rounds of competitions, we are aware that some entries may be completed after 2025.

We’re looking for all types of entries – be they technology, methodologies and approaches, culture, business practices, commercial models or something else. Initiatives can be at any stage, as can the technologies, methods and models that you may use within them. Due to this, we are not providing a specification based on the Technology Readiness Level (TRL) scale.

All entries should be for different initiatives.

Location of work will be up to those submitting the entry. It should benefit customers in England and Wales.

Yes, we are open to proposals at all stages of development, including the early incubation of new ideas and solutions.

Where a participant’s background IPR is required for the purposes of using foreground IPR, we expect a limited appropriate form of licence to be granted by the participant.

Please read more details about this on page 9-10 in our Innovation Fund Briefing sheet, published in August 2020.

Please read details on IPR in the Entrant Handbook and Terms and Conditions.

Prior to entries being opened, what we had published was  available on page 9-10 in our Innovation Fund Briefing sheet, published in August 2020.

All project durations will be considered. We expect to see clear short- and long-term outcomes and a strategy for scaling up for longer duration projects.

We are open to companies using later competition rounds to further the development of a previously successful entry – subject to evidence and assurance that there is no double funding.

6. Entering the IWC

You need to complete an online application form available here.

The application questions are available in the Entrant Handbook and on the Assessment Criteria page.

We are aiming to make sure the application process is as efficient and practical as possible, ensuring ease of access for organisations, in particular smaller companies.

As a guide, we would not expect it to take you more than half a day to complete the application form.

You can submit as many entries into the challenge as you like, providing each entry is for a different initiative. It is unlikely, however, that funding will be awarded to more than three entries with the same lead applicant.

There will be networking and brokerage events organised in January 2021 and throughout 2021 ahead of future rounds of competitions.

An alliance of water companies are currently working together to establish a Centre of Excellence which would facilitate coordination and collaboration between companies and third parties. You can find out more in the UK 2050 Water innovation strategy.

We are working to make the Challenge as accessible as possible.

If there are any reasonable adjustments that would support you to enter, please contact waterinnovation@nesta.org.uk.  We will be happy to explore options to enable you to take part. Unfortunately, no time extensions will be possible.

Entries to the competition will be confidential; they will be shared with those involved in running and assessing entries, including our delivery partners and the judging panel in confidence. Details of entries will be considered as part of our ongoing evaluation activities and may form evidence for future policy developments. No evidence published, following our evaluation, will be attributable to individual entries or entrants.

If you are successful in winning funding for your entry, one of the conditions of accepting this funding will include publicity of your initiative.

Please review the full terms and conditions and privacy policy for full details.

The lead applicant (a water company or a NAV) should submit the application.

No, this is optional support to help form new partnerships.

Although it was explored as part of the consultation process, there are no plans for a dragons’ den style part of the selection process for the first round of the IWC.

You can submit as many entries into the challenge as you like, providing each entry is for a different initiative. It is unlikely, however, that funding will be awarded to more than three entries with the same lead applicant.

7. Costs & Funding for IWC

The lead applicant will receive the funds.

The lead applicant (a water company or NAV) will receive the funds. It is a contractual matter between members of a partnership how the funds will then be split and allocated between different parties within the partnership. This also applies where there is a consortium of water companies.

We expect entries to demonstrate value for money, with a clear case for any costs included in the entry budget.

Funds from this competition are not classified as State Aid.

We are open to projects which have been successful in other funds, but it must be clearly evidenced that there is no duplicative or double funding. The entry should make clear how additional funding will deliver additional value to customers, society and the environment in line with one or more of our strategic innovation themes to meet the assessment criteria. The entrant(s) will also need to confirm that it is not restricted by its current funding source when applying for additional and alternative funding through this Fund.

Yes, in fact, there is a minimum 10% financial contribution to winning entries by water companies in England and Wales.

You are welcome to enter with projects or initiatives that already have additional funding (e.g. organisational investment, public or private funding) but it must be clearly evidenced that there is no duplicative or double funding.

We expect water companies to make a minimum 10% financial contribution to innovation competition entries, as customers should not bear all the risk of initiatives funded through the competition. This may be a direct cash contribution by the water company, or come through commercial partnerships or other funding sources (not including other sources of customer contributions e.g. Green Recovery Fund).

Whilst we expect the minimum contribution to be financial, we welcome and are flexible on any additional contributions that water companies or other entry participants may wish to make beyond the 10% financial contribution. These may be further financial and/or non-financial contributions. Any additional contributions will be considered favourably during the assessment of entries. More details can be found on the Ofwat Website. 

We expect entries to demonstrate value for money and only reasonable costs will be considered. Entries are welcome to include reasonable indirect costs for non-water company participants, on top of any entry-specific costs, which may include staff time.

Whilst we expect the minimum contribution to be financial, we welcome and are flexible on any additional contributions that water companies or other entry participants may wish to make beyond the 10% financial contribution. These may be further financial and/or non-financial contributions. Any additional contributions will be considered favourably during the assessment of entries.

It is a contractual matter between members of a partnership how the funds will then be split and allocated between different parties within the partnership. This also applies where there is a consortium of water companies. Part of the assessment criteria focuses on the entry’s capacity and capability to deliver.

Funding will be available in Q1 of 2021/22. For higher value projects and/or those with higher risk levels, entrants are invited to propose a gated process for funding aligned to key project deliverables.

Yes, there is scope to change the weighting, the total funding available for each competition is only a guide. If we receive a high number of high-quality proposals for the IWC we are not restricted to £2 million. Equally, we may rollover funds to a future competition if we do not receive a sufficient number of high-quality entries.

The split of the competitions was explored in our recent round of consultations.

Funding will be available in Q1 of 2021/22.