Decarbonising UK Manufacturing: 2025 Grants

1. Industrial Heat & Renewable Energy Upgrades

Energy-intensive manufacturing sectors can benefit from schemes supporting:

• Heat pumps

• Biomass systems

• Solar PV

• LED lighting & building fabric upgrades

🔹 Key Opportunity:

Industrial Energy Transformation Fund (IETF) – Phase 3 rounds open in 2025

• Up to 70% funding for projects that cut industrial carbon emissions

• Includes process efficiency, electrification, and onsite renewables

🔗 Learn more about IETF

2. Electrification & Energy Efficiency

Through schemes like the Public Sector Decarbonisation Scheme (for public suppliers/partners) and Energy Efficiency Loans, manufacturers can access support for:

• Heat recovery

• Variable speed drives

• Smart controls

• Factory electrification

💡 Some local enterprise partnerships (LEPs) also offer low-interest loans and match funding for industrial energy upgrades.

🔗 Check local LEP support via the LEP Network

3. Hydrogen, HVO & Clean Fuels for Industry

Manufacturers that rely on high-temperature processes or diesel-based equipment can explore:

• Hydrogen retrofits or switching

• HVO (Hydrotreated Vegetable Oil)

• Bio-LPG pilots

The ZEHID and CMDC programmes—though aimed at logistics and ports—also support fuel switching infrastructure relevant to industrial estates and shared logistics zones.

🔗 ZEHID info

🔗 Clean Maritime Demonstration Competition

4. Innovation & R&D Funding for Engineers

2025 is a huge year for low-carbon innovation in engineering, with dedicated support for trials, prototypes, and demonstrators through:

• Innovate UK Smart Grants – for transformative tech

• TRIG (Transport Research & Innovation Grants) – includes manufacturing-adjacent projects

• Made Smarter Innovation – focused on digital manufacturing, IoT, and sustainable design

R&D grants often cover up to 70% of eligible project costs and help de-risk clean technology adoption in the production environment.

🔗 Innovate UK Smart Grants

🔗 Made Smarter Innovation

Carbon Footprinting & Sustainability Reporting

Manufacturers are increasingly expected to measure and disclose:

• Scope 1 & 2 emissions

• Carbon intensity per product

• Lifecycle emissions (LCA)

Funded support is available for adopting ESG reporting frameworks. The SBS Net-Zero Program is available part funded via many local authority schemes, plus further funding may be available defendant on your local authority area for SBS Support.  SMEs and suppliers to public sector or large net-zero-aligned buyers.