Ofwat has opened an £8 million funding competition to help farmers tackle water shortages, drought and pollution through practical agricultural innovation. ## What the challenge offers The Agri-Water Cross-Sector Challenge, launched on Tuesday 10 November 2026, will award grants of between £200,000 and £2 million to partnerships developing solutions across England and Wales. Entries can cover up to 90% of project costs. The competition is seeking proven, mid-stage to mature innovations that can be scaled up or moved into real-world use, rather than entirely new ideas needing early-stage research. Applicants must show collaboration between agriculture and other sectors, with potential partners including water companies, environmental organisations, researchers, technology businesses and food producers. Entries opened on 10 November and close at 1pm on 8 February 2027, provided applicants have registered an expression of interest by 8 January. A launch webinar for prospective entrants takes place on 17 November, from 11am to midday. ## Part of a wider innovation programme The challenge is the first competition under Ofwat's five-year, £40 million Water Innovation Cross-Sector Programme, and sits within the regulator's Water Innovation Fund, which is investing £600 million over ten years. It is delivered by Challenge Works, part of Nesta, in partnership with Arup and Isle. Winning projects are expected to be announced in late May or early June 2027. Dr Jo Jolly, Ofwat's director for natural assets, environment and innovation, said farmers' practical knowledge would be essential to finding workable solutions. One earlier project, Water Net Gain, is testing smart on-farm ponds designed to capture surplus water during wetter periods and make it available when supplies run scarce. Sources: FarmingUK (https://www.farminguk.com/news/ofwat-unveils-8m-fund-to-boost-water-resilience-across-british-farms_69454.html) and Water Innovation Fund (https://waterinnovation.challenges.org/water-innovation-cross-sector-challenge/agri-water-challenge/).