DRIVE35: £40 Million UK Funding Boost for Hydrogen and Zero-Emission Vehicle Technologies

Whitehall has unveiled a major £40 million initiative to accelerate the commercialisation of the UK’s zero-emission vehicle technologies. The DRIVE35 Innovation Fund, delivered by the Department for Business and Trade in partnership with Innovate UK and the Advanced Propulsion Centre (APC), is designed to bridge the gap between late-stage research and full-scale production, giving proven technologies the push they need to reach the market.

The fund is specifically aimed at collaborative R&D projects that are ready to move beyond prototype testing into manufacturing at scale. For UK hydrogen innovators, this represents a significant opportunity, with hydrogen fuel cells, hydrogen engines, and related storage and management systems explicitly highlighted as eligible technologies. This includes high-pressure tanks, regulators, control systems, and the essential balance-of-plant components – pumps, valves, sensors, and electronics – that ensure safe and efficient operation.

Hydrogen internal combustion engines are also within scope, provided road-going applications demonstrate zero harmful tailpipe emissions using non-fossil fuels, and off-road projects chart a credible path to zero emissions. Beyond vehicle-ready hardware, DRIVE35 encourages projects across the upstream supply chain, including component manufacturing, specialist tooling, and materials development. Initiatives that embrace circularity and design-for-disassembly, allowing products to be reused at the end of their life, are also strongly supported. Digital design and validation, using virtual modelling and simulation to de-risk physical production, is another key focus area.

All projects must align with at least one of three strategic themes set out by the Department for Business and Trade:

1. Promote Zero-Emission Vehicle Technologies– covering fuel cell systems, hydrogen storage solutions, and zero-emission engines.
2. Enhance Manufacturing Competitiveness– innovations that make production faster, more efficient, lower-carbon, and more localised in the UK.
3. Future Vehicle Innovation – Software-Defined Vehicles and E/E Architectures– integrating intelligent software and electronics, including systems that optimise power delivery between hydrogen fuel cells and onboard batteries.

Projects are expected to reach Technology Readiness Level (TRL) 7–8 and Manufacturing Readiness Level (MRL) 6–7, indicating pilot production capability. Duration ranges from 18 to 36 months, commencing no later than 1 March 2026, with grant requests between £2.5 million and £25 million. Each consortium must include a UK-based vehicle manufacturer or Tier 1 supplier and at least one SME, with funding rates reflecting Innovate UK rules: smaller companies can claim a higher proportion of eligible costs, while experimental development projects receive a lower percentage than early-stage research.

The APC has emphasised domestic supply-chain benefits as a core criterion. Bids are expected to demonstrate how projects will strengthen UK manufacturing, increase local content, and cluster capabilities around British production sites, reducing import reliance and securing home-grown jobs.

Applications for DRIVE35 close at 11:00am on 1 October 2025, with shortlisted projects interviewed in late November. Successful bids can start as early as March 2026. For UK hydrogen developers with proven technologies, DRIVE35 offers one of the few government-backed opportunities to scale up from small-batch prototypes to fully industrialised products, positioning hydrogen on equal footing with battery technologies in the country’s race towards net-zero mobility.