Energy and renewables businesses are at the centre of the UK's transition to a cleaner, more resilient and more efficient energy system. From solar, wind and battery storage to hydrogen, smart grids, carbon reduction, heat networks, energy efficiency and low-carbon industrial technology, many companies in this sector are solving complex technical problems that may qualify for R&D Tax Credits.
Why Us
Innovation in energy and renewables often involves developing technology that must perform reliably in demanding commercial, environmental and infrastructure conditions. Qualifying R&D may arise where a business is developing or improving generation systems, storage, grid integration, monitoring, control software, energy efficiency, carbon reduction or low-carbon processes because existing solutions cannot meet the required performance, reliability, safety, cost or scalability requirements.
This includes work across:
Energy and renewables R&D is strongest when the claim explains the technical challenge behind the sustainability outcome: what had to perform better, why existing solutions were not enough, and how the team tested or developed the answer.
Head Of Compliance & Tax Disputes
A note from Simba Mareverwa
Energy and renewables projects are often described in terms of sustainability, efficiency or carbon reduction, but HMRC will want to understand the scientific or technological uncertainty behind the project. A claim is not strengthened simply because a project is green, low-carbon or commercially important. It needs to show what technical advance was being sought and why the answer was not readily available.
That uncertainty may sit in generation efficiency, storage performance, grid connection, system stability, power conversion, thermal performance, degradation, control logic, data accuracy, integration with existing infrastructure, safety or scalability. A strong claim should explain the baseline technology, the limitation being addressed, the testing or development carried out, and the evidence showing how the business worked through the uncertainty.
Simba Mareverwa, InnoFund's Head of Compliance and Tax Disputes, helps ensure energy and renewables R&D claims are reviewed with compliance at the centre. His focus is making sure claims are not built around generic net zero language, but around clear technical evidence, eligible activity, competent professional input and defensible methodology.
Qualifying R&D
Energy and renewables companies may qualify for R&D Tax Credits where they are seeking an advance in science or technology and have to overcome technical uncertainty. Qualifying activity can arise across generation, storage, grid integration, hydrogen, heat technologies, energy efficiency, carbon reduction, software and low-carbon industrial systems.
R&D may arise where a business is developing or improving solar, wind, hydro, marine, biomass or other renewable generation systems. This could include work to improve output, reliability, durability, installation methods, environmental performance, maintenance requirements or performance under variable real-world conditions.
Energy storage projects may qualify where a business is developing or improving battery systems, charge and discharge performance, degradation management, thermal control, safety, power conversion or energy management software. The technical uncertainty often sits in how storage performs over time, at scale or when integrated with wider energy systems.
R&D can arise where companies are developing systems that help balance supply and demand, manage distributed generation, optimise flexible loads or improve network resilience. This may include software, sensors, control systems, forecasting tools or automation where standard solutions do not meet the required technical performance.
Hydrogen and low-carbon fuel projects may qualify where a business is developing or improving production, storage, distribution, blending, safety, monitoring or end-use technologies. R&D may arise where the project involves uncertainty around efficiency, materials compatibility, leakage, pressure, purity, combustion behaviour or system integration.
Projects may qualify where a business is developing new or improved ways to reduce energy consumption, recover waste heat, improve thermal performance or integrate heat pumps, heat networks or industrial efficiency systems. The R&D must involve technical uncertainty, not simply the installation of known energy-saving equipment.
R&D may arise where a business is developing technologies or processes to reduce emissions, capture carbon, use waste streams, improve process efficiency or replace high-carbon inputs. This can include technical work around capture rates, material behaviour, process control, energy demand, integration with existing plant or long-term system performance.
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Non-Qualifying Work
Not every energy project, renewable installation or efficiency improvement will qualify for R&D Tax Credits. The key question is whether the business faced scientific or technological uncertainty and carried out systematic work to resolve it.
Examples of work that may not qualify include:
Energy and renewables projects often contain a mixture of qualifying and non-qualifying activity. InnoFund helps separate standard deployment from genuine R&D so the claim is accurate, compliant and defensible.
Why Us
Energy and renewables businesses may be able to claim relief on qualifying costs linked to eligible R&D projects, including:
The treatment of subcontracted work, client-funded projects, externally provided workers, prototype materials, modelling software and technical consultancy can be particularly important in energy and renewables R&D claims.
InnoFund helps identify which costs are eligible and ensures the claim is built around the qualifying technical work, not just the wider sustainability or commercial project.
HMRC is applying greater scrutiny to R&D Tax Credit claims, including claims from low-carbon, energy and infrastructure businesses. A strong claim must explain the technical uncertainty clearly and show why the work went beyond standard installation, deployment or commercial sustainability activity.
Common risk areas include:
InnoFund helps energy and renewables companies prepare claims that are clear, compliant and evidence-led. We focus on the technical work behind the sustainability outcome, the uncertainty faced, the process followed and the costs directly connected to qualifying activity.
Yes. Energy and renewables companies can claim R&D Tax Credits where they are seeking an advance in science or technology and have to overcome technical uncertainty. This may include work involving renewable generation, battery storage, smart grids, hydrogen, energy efficiency, heat technologies, carbon reduction, software, sensors or low-carbon industrial processes.
Solar or wind projects may qualify where the business is developing or improving technology, installation methods, monitoring, durability, output, maintenance, control systems or grid integration. Routine installation of standard solar panels or wind equipment is unlikely to qualify on its own.
Yes. Battery storage projects may qualify where the business is solving technical problems around performance, degradation, safety, thermal management, charging, discharging, control systems or integration with renewable generation and wider energy infrastructure.
Energy efficiency projects can qualify where the business has to develop or adapt technology because existing solutions do not meet the required performance. Routine upgrades, standard audits or straightforward installation of known equipment are unlikely to qualify without technical uncertainty.
Yes. Hydrogen and carbon capture projects can qualify where the business is overcoming technical uncertainty around production, storage, distribution, capture efficiency, safety, materials, system integration, process control or long-term performance.
Useful evidence may include design documents, technical specifications, test results, modelling outputs, energy performance data, grid integration notes, prototype records, software logs, failure records, materials analysis, commissioning reports, meeting notes and explanations from the competent professionals involved.
Other Innovation Funding Services
Reduce Corporation Tax on profits from qualifying patented innovations.
Claim tax relief for cleaning up contaminated or derelict land.
Specialist support to defend tax relief claims when HMRC raises questions.
Why Us
Got a project you want to discuss? InnoFund helps separate routine delivery from genuine R&D so that claims are accurate, compliant and properly evidenced. Speak to our innovation funding experts today.
or call 020 4583 1267
