'Innovation takes time, and the process is not always linear; innovation does not always lead directly to a BAU rollout.'
The words not of a critic, but of the energy network sector's own annual report, gently acknowledging something the industry has known for a while but rarely says plainly: getting innovation into operations is genuinely hard, and we haven't solved it yet.
The numbers tell a complicated story
In FY24/25, electricity networks alone registered 120 innovation projects, with estimated financial benefits of over £13.8bn from around £150m of funding provided (ENA Innovation Summary, 2025). On paper, that's an extraordinary return.
But how much of that actually landed in operations?
The answer is difficult to pin down. Ofgem requires every NIA and SIF project to publish a Close-Down Report or a BAU Transition Deliverable. Energy networks have been required to populate an Innovation Measurement Framework (IMF) since the beginning of RIIO-2 via the Energy Networks Association, and since 2024, gas networks via the Future Energy Networks which they term an ‘Implementation Log’. But in practice, these logs aren’t publicly accessible. And in the gas networks' most recent annual innovation report, not a single BAU-funded project was reported through the Innovation Measurement Framework. One project, Northern Gas Network’s Navigator, was flagged as near-BAU deployment. Just one.
Over two decades of network innovation, 3,000+ funded innovation projects have produced real capabilities: better demand forecasting, real-time network controls, faster connections. The 2026 ENA Innovation Strategy lists seven of them. But capability and deployment are not the same thing. Knowing something works in a trial is different from it working on shift, at scale, every day.
Why the gap exists
The barriers aren't a mystery. Anyone who has worked closely with networks will recognise them.
The first is organisational. Innovation teams and operations teams often have different incentives and definitions of success. A trial that concludes successfully from an innovation manager's perspective may never reach the operations director who would need to sanction a change to standard practice.
The second is procurement. Embedding a new technology or process into BAU typically triggers procurement requirements, contract novation, vendor assessments, and change management processes that weren't part of the original project scope. These aren't unreasonable; they exist for good reasons, but they create friction that many innovations can’t overcome as they’ve not been accounted for in earlier project planning.
The third is risk aversion at the point of transition. Networks bear significant reputational and financial risk if something goes wrong in operations. A trial has a defined boundary and an exit route, but BAU doesn't. That asymmetry makes decision-makers cautious, particularly when an outgoing project manager hands over to someone who had no involvement in the trial and carries none of its institutional knowledge.
Finally, and perhaps most importantly, the skills that make a good innovation project aren't the same skills that make for good operational deployment. Designing and running a funded trial requires bid writing, stakeholder management, data collection, and academic rigour. Whereas deploying at scale can require significant change management, training, systems integration, and operational discipline. Most organisations aren't structured to do both seamlessly.
Ofgem signals the intent to change this
The regulator has clearly read the same data so introduced a new SIF funding stream: Deployment. This provides £500k+ for networks to translate proven innovations into BAU operations. It's notable not just for what it funds, but for what it signals: that generating innovation is no longer enough and that value delivery is now the measure.
The Balanced Scorecard the regulator uses to assess network innovation performance includes Metric 7: the percentage of completed TRL 8 projects moved into BAU. With the ENA also reporting that they’re building a visual to showcase BAU capabilities across the sector, the direction is consistent. Ofgem is no longer satisfied with innovation as an activity; it wants innovation as an outcome.
What good looks like
NGED's EQUINOX project is the clearest example of what the Deployment pot is trying to replicate. EQUINOX was more than just a successful heat pump flexibility trial; its findings now underpin the demand profiles and network planning assumptions the business uses every day. Since the project's inception, 8,761 heat pump assets have been formally registered in NGED's BAU market, and NGED has confirmed that tailored market designs for heat pumps are unnecessary; they can participate in existing flexibility markets alongside EVs and home batteries, removing a design question that had slowed broader adoption elsewhere. Demand Turn-Up, driven in part by the trial's interim results, was launched as a flex service procurement route in 2024 and is now embedded in NGED's FlexUp service covering over 50% of the network.
As the project itself put it: 'EQUINOX has already driven change within NGED.'
That's what a completed innovation journey should look like.
The question networks should be asking now
The new SIF Deployment funding stream creates a practical opportunity, but only for networks that do the prior diagnostic work.
The right starting point is a portfolio review. Which of your completed or near-complete projects reached TRL 8 but stalled before operations? What were the specific barriers: technical integration, internal buy-in, procurement process, or something else? Is there a funded pathway available to bridge them? And critically, who within the organisation would champion a deployment programme that sits across the innovation-operations boundary?
Networks with a mature innovation portfolio may find that the Deployment pot isn't a new opportunity so much as a mechanism for finishing what was already started.
The energy transition needs innovation to land, not just to launch. Right now, we’re seeing a significant portion of the sector's innovation investment being lost because innovative solutions can’t make the jump to BAU implementation.
The SIF Deployment funding stream is a signal that this is changing. Networks that take it seriously, that treat BAU transition as a discipline rather than a future problem, will get more out of their innovation portfolios and, more importantly, deliver more for customers.
If you can't answer those four questions, then I’d welcome a conversation about running through your portfolio against them. Please message me via LinkedIn or at connor.innes@bfygroup.co.uk
