Strategic Defence Review - Grant Structure Information notice

The UK government is acting on the Strategic Defence Review's recommendations by investing in the 'factories of the future' initiative, bringing energetics industries back to the UK, and strengthening our long-term national security by building up to six new energetics and munitions factories in the UK.

The purpose of this notice is to communicate the Ministry of Defence's (MoD's) intention to open grant windows to support the construction of new energetic synthesis facilities. The MoD expects there to be multiple grant windows, during which companies may submit grant proposals.

The grants are designed to establish new, sustainable UK production capacity for critical energetic materials. We are seeking to strengthen the resilience and security of our munitions supply chain, reduce reliance on overseas sources and unlock significant private investment in UK manufacturing.

Advertisement of these grants will take place on the UK Government Find a Grant portal which will then provide a link to the application form on the Defence Sourcing Portal. Any company can apply to any or all investment windows regardless of having prior engagement with MoD however only one grant per project will be awarded.

The first of these windows is planned to open imminently:

This window will be open to applications for 6 weeks after which a down selection will take place based on the information provided in the application form.

Those companies taken forward will be invited to further engage with the MoD to carry out due diligence and develop a grant award structure with the intention to issue Grant award letters to the successful companies within this fiscal year.

Individual proposals will be eligible for grants of up to £45 million or 50% of the overall cost, whichever is smaller. The overall level of investment will depend on the quality and value for money assessment of proposals received, with funding decisions taken across the programme to ensure investment is targeted where it can deliver the greatest strategic benefit.

Companies with credible proposals to invest in new UK energetic materials production capability are encouraged to apply. The grant competition is separate from the feasibility and engineering-design work already under way, and companies do not need to have participated in those earlier stages to apply. Proposals will need to demonstrate that they are technically credible, economically viable and capable of delivering strategically important UK production capability.

Further grant windows are expected in Q2 and Q4 of 2027, however these are dependent on MoD need and may be subject to change.

MoD investment will sit alongside the wider support opportunities offered by HM Government as set out in previous communications with industry.

Additional information:

Proposals for Grants are expected to demonstrate the following which will be assessed by a MoD technical panel:

Economic viability

Demonstrate that the project is commercially viable over the medium and long term.

Available financing

Demonstrate that the applicant has access to the remainder of the funding required to deliver the proposal should a grant be awarded.

Technical credibility (including deliverability of the proposal)

A comprehensive and credible plan of how the project will be delivered (max 15,000 words).

This may consider:

Process and product technical maturity.

Design basis and key assumptions.

Plant capability, flexibility and maintainability.

Utilities, staffing, logistics, testing and storage.

Safety and regulatory feasibility.

Uncertainty, risks and mitigations.

Credibility of cost, schedule and delivery strategy.

Military usefulness

The MoD has previously communicated materials of interest within the SDR Energetics programme. To maximise the number of materials that can be proposed either of the following requirements should be met:

The material is a major ingredient in energetic formulations and in UK service.

The material is a major component in energetic formulations and is not in UK service but could have some applicability to UK systems.

Regulatory strategy

Demonstrate how the relevant regulatory requirements will be met ensuring that the highest standards of safety and environmental protection continue to be met throughout the grant process.