Government funding available to decarbonise freight

The third year of the £7 million Freight Innovation Fund Accelerator has been launched in an effort to decarbonise freight in the UK.

Small and medium-sized enterprises (SMEs) can receive up to £1.8 million in Government funding to support the freight sector in deploying technology and automation to improve the way trains, lorries, vans, and ships carry parcels and goods.

The first two years of the fund saw nearly £3m allocated to several SMEs to make British supply chains cleaner and more efficient.

Examples of the ideas that have become reality thanks to support from the Freight Innovation Fund include Royal Mail working with Skyports to deliver mail by drones across the islands in Orkney.

This is the first time ever mail is being delivered by drones in the UK, allowing Royal Mail to deliver 24 hours faster than using vans or ferries.

The Freight Innovation Fund has also supported FedEx in trialling new eCargo bikes to deliver parcels in traffic-heavy city centres, helping decarbonise deliveries

Previous funding winners have reported a collective £97m in commercial investment from the £1.2m Government Year 1 fund.

Roads minister Guy Opperman said: “The freight and logistics sectors are part of our economy’s backbone, ensuring supermarket shelves are stocked, hospitals receive crucial medical supplies and important deliveries are made.

“That’s why, as part of the Government’s plan to grow the economy, the Freight Innovation Fund is supporting businesses to innovate and back skilled UK jobs.”

The fund was originally launched in 2022 as part of the Government’s Future of Freight plan.

Connected Places Catapult’s chief executive officer, Erika Lewis, said: “The UK’s freight sector plays a major contribution to our economy, but there are many opportunities worth exploring to improve efficiencies and environmental performance associated with the movement of goods.  

“I am excited to see what new ideas and technologies companies taking part in the Freight Innovation Fund Accelerator come up with, and I encourage SMEs to come forward.”

Delivered by Connected Places Catapult, the Freight Innovation Fund will give SMEs access to technical and business support from the organisation.

Alex Brown, director at Skyports Drone Services, said: “The Freight Innovation Fund Accelerator, alongside the work with Royal Mail, was a key proof point we could speak to during our capital raise process to demonstrate the progress we were making with our drone delivery business.

“Importantly the work with Royal Mail in the Orkney Islands is still ongoing demonstrating how a catalyst like the Freight Innovation Fund Accelerator can result in lasting products and services.”

The funding was welcomed by the Road Haulage Association (RHA). Director of public affairs and policy for England, Declan Pang, said: “We welcome today’s announcement of the third year of the Freight Innovation Fund Accelerator which will play an important role in exploring ways of improving productivity and efficiency of freight movements and reducing emissions

“The road haulage and commercial vehicle industry is the lifeblood of the UK economy and innovative investment in its future is vital in order to keep Britain’s businesses, homes and public services stocked with the raw materials and goods they need to continue operating efficiently and effectively.”