UK Innovation Agencies Launch Market-Forming Project to Scale Low-Carbon and Circular Technologies
Innovate UK and the Department for Energy Security and Net Zero commission ERM and partners to identify market interventions supporting low-carbon materials in the automotive, built environment and chemicals sectors
The United Kingdom’s innovation agency and the Department for Energy Security and Net Zero (DESNZ) have commissioned a consortium led by sustainability consultancy ERM to identify and shape market interventions designed to accelerate low-carbon, resource-efficient and circular business models in key industry sectors.
The initiative will focus on the automotive, built-environment and chemicals sectors and seek to develop actionable recommendations on how to create and scale markets for products, materials and business models aligned with the UK’s industrial strategy and net-zero goals.
The contract notice reveals that ERM, along with Eigen Ventures, the Scope 3 Peer Group and SRS Sustainable Business, will map potential intervention points and help establish an ecosystem of organisations capable of delivering market change.
According to published procurement information, Innovate UK and DESNZ awarded Contract UKRI-5129 titled “Forming Markets for Resource Efficiency Innovation,” valued at approximately £298,754 excluding VAT, on 29 September 2025. The work is scheduled to run from 13 October 2025 through to 31 March 2026.
In support of this work, stakeholders from across the value chain—including manufacturers in chemicals, construction and automotive, procurement and category managers, UK innovators of low-carbon solutions, and financiers focused on scaling resource-efficient technologies—are invited to participate in surveys and targeted working groups.
The project aims to surface real-world barriers to market uptake and propose interventions such as advance market commitments, procurement innovation, certification and standards, supply-chain aggregation or finance models.
Representatives of the agencies emphasised the importance of bridging the gap between technological innovation and market deployment.
Stafford Lloyd, Innovation Lead at Innovate UK, said that having already pioneered a market-forming intervention for low-carbon concrete, the agency was “excited” to see how similar strategies could be applied across sectors with strong potential for emissions reduction.
Agnès Estibals, Deputy Director for Resource Efficiency at DESNZ, added that this project will build “resilience of supply chains” and deliver on the government’s circular-economy and industrial-strategy ambitions.
The selection of sectors reflects their material intensity and carbon-reduction potential.
For example, the construction sector’s embodied carbon accounts for a significant share of lifecycle emissions, while chemicals and automotive manufacturing are high-impact in both carbon and resource use.
The project comes at a time when economic and policy signals are aligning in favour of low-carbon supply-chain innovation.
As the study unfolds in the coming months, its outputs are expected to guide future government-industry programmes, including potential interventions, procurement vehicles and demand-aggregation mechanisms designed to pull through innovation at scale and unlock decarbonisation across hard-to-abate sectors.
The initiative will focus on the automotive, built-environment and chemicals sectors and seek to develop actionable recommendations on how to create and scale markets for products, materials and business models aligned with the UK’s industrial strategy and net-zero goals.
The contract notice reveals that ERM, along with Eigen Ventures, the Scope 3 Peer Group and SRS Sustainable Business, will map potential intervention points and help establish an ecosystem of organisations capable of delivering market change.
According to published procurement information, Innovate UK and DESNZ awarded Contract UKRI-5129 titled “Forming Markets for Resource Efficiency Innovation,” valued at approximately £298,754 excluding VAT, on 29 September 2025. The work is scheduled to run from 13 October 2025 through to 31 March 2026.
In support of this work, stakeholders from across the value chain—including manufacturers in chemicals, construction and automotive, procurement and category managers, UK innovators of low-carbon solutions, and financiers focused on scaling resource-efficient technologies—are invited to participate in surveys and targeted working groups.
The project aims to surface real-world barriers to market uptake and propose interventions such as advance market commitments, procurement innovation, certification and standards, supply-chain aggregation or finance models.
Representatives of the agencies emphasised the importance of bridging the gap between technological innovation and market deployment.
Stafford Lloyd, Innovation Lead at Innovate UK, said that having already pioneered a market-forming intervention for low-carbon concrete, the agency was “excited” to see how similar strategies could be applied across sectors with strong potential for emissions reduction.
Agnès Estibals, Deputy Director for Resource Efficiency at DESNZ, added that this project will build “resilience of supply chains” and deliver on the government’s circular-economy and industrial-strategy ambitions.
The selection of sectors reflects their material intensity and carbon-reduction potential.
For example, the construction sector’s embodied carbon accounts for a significant share of lifecycle emissions, while chemicals and automotive manufacturing are high-impact in both carbon and resource use.
The project comes at a time when economic and policy signals are aligning in favour of low-carbon supply-chain innovation.
As the study unfolds in the coming months, its outputs are expected to guide future government-industry programmes, including potential interventions, procurement vehicles and demand-aggregation mechanisms designed to pull through innovation at scale and unlock decarbonisation across hard-to-abate sectors.
