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The Network Innovation Competition (NIC) cannot fund true innovation because of its adverse attitude towards failure and the short time frame allowed to judge a project’s success, third parties involved in the scheme have said.
In response to an Ofgem consultation on the future of innovation funding, several submissions said there is no provision in the scheme for failure, a major risk of any innovation.
Projects only qualify for full reward if they are successful, actively discouraging third parties from involvement in early-stage projects which are more likely to fail.
This, combined with the requirement for project findings to be incorporated into ‘business as usual’ practice by network operators soon after completion, is encouraging a focus on technology-ready projects over those in earlier stages of development, respondents said.
This will result in a dwindling pipeline of future projects, according to the Energy Innovation Centre (EIC), which will have a “detrimental effect on the networks, but also ultimately on energy customers.”
EA Technology, project lead on Scottish and Southern Energy Power Distribution’s Low Carbon Networks Fund project My Electric Avenue, said there should be “greater recognition of long term benefits in the NIA and NIC criteria”.
It added that the NIC should look more favourably on failure as “such outcomes always result in valuable learning that should be recognised and rewarded.”
Calls have also been made for rules on intellectual property to be relaxed as both networks and third parties say they are a major barrier to participation in the scheme.
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