Questions and answers on the Innovation Fund 2024 Call for Net-zero Technologies

Which projects have been selected by the Innovation Fund's call for NetZero Technologies (IF24 Call)?

The call supports projects in five different topics: general decarbonisation for large-scale, medium-scale, and small-scale projects, clean-tech manufacturing and pilots. 

In the ‘general' decarbonisation large-scale topic (for projects with CAPEX above €100 million):

• 10 projects are selected for grants, receiving a total of €1.26 billion. They include projects from the following sectors: cement & lime (5), refineries (3), chemicals (1), and one related to carbon capture and storage infrastructure. These projects are located in Belgium, Denmark, Greece, Spain, France, Italy, and Romania.. Similar to the Innovation Fund 2023 Call, this topic showed the highest budget oversubscription, requesting over 10 times the initial budget of €1.2 billion.

In the ‘general' decarbonisation medium-scale topic (for projects with CAPEX between €20 million and €100 million):

• 19 projects are selected for grants, receiving a total of €459 million. They include projects from the following sectors: six for refineries (6), three from cement & lime (3), buildings (1), chemicals (1), glass (1), iron & steel (1), maritime (1), road transport (1) and solar energy (1), and three projects in the ‘other' category which are related to chemical recycling, refineries and industrial carbon management. They are located in Belgium, the Czech Republic, Denmark, Estonia, Greece, Spain, France, Italy, Lithuania, the Netherlands, Norway, Finland, and Sweden.

For the ‘general' decarbonisation small-scale topic (for projects with CAPEX between €2.5 million and €20 million):

• 10 projects are selected for grants, collectively receiving €53 million. They include projects from the following sectors:  cement & lime (2), solar energy (2), aviation (1), manufacturing of components for renewable energy (1), non-ferrous metals (1), other energy storage (1), and two projects in the ‘other' category related to heat recovery. They are located in Belgium, Spain, France, Germany, Italy, and Poland.

In the ‘cleantech manufacturing' topic (for projects with CAPEX above €2.5 million) focusing on the manufacturing of components for renewable energy, energy storage, heat pumps and hydrogen production:

• 11 projects are selected for grants, together receiving €774 million. They include projects from the following sectors: renewable energy component manufacturing (6), projects on battery recycling (4) and one project on Energy Intensive Industry components. They are located in Denmark, Germany, Spain, France, the Netherlands, Austria, Poland, Portugal, Finland, and Sweden.

In the ‘pilots' topic (for projects with CAPEX above €2.5 million) focusing on deep decarbonisation where the relative GHG emission avoidance should be a minimum of 75%:

• 11 projects are selected for grants, receiving a total of €321 million. They include projects in the following sectors: refineries (2), maritime (2), aviation (1), chemicals (1), geothermal energy (1), hydrogen (1), non-ferrous metals (1), and road transport (1), and a further project in the ‘other' category related to industrial carbon management. They are located in Belgium, France, Italy, Netherlands, Norway, and Finland.

How does the IF24 Call contribute to EU policy objectives and boost the resilience and competitiveness of European companies?  

The Innovation Fund uses revenues from the auctioning of allowances under the EU Emissions Trading System (ETS) to invest in Europe's clean industrial transition. This is at the heart of Europe's climate policies, driving down emissions in a fair and economically efficient way, while stimulating the transition to clean energy, technologies and industries.

In 2023, the revision of the EU Emissions Trading System Directive strengthened the Innovation Fund to lead the way in clean tech investments and set the example on a global stage to contribute to the goals of the European Green Deal by increasing its budget and introducing new auctioning tools. The Fund is one of the key tools of the European Green Deal and the Clean Industrial Deal.

The following policy objectives are highlighted as key priorities:

1. Cleantech manufacturing:

The Innovation Fund supports the REPowerEU Plan to phase out Europe's dependency on Russian fossil fuels and is fully aligned with the priorities of the Net-Zero Industry Act (NZIA) , providing funding for a low- and net-zero-carbon economy, helping to bridge the cost gap between conventional and clean energy industries and accelerating the demonstration and deployment of innovative low-carbon solutions in Europe.

The ‘Cleantech Manufacturing' category under theIF24 Call targets manufacturing components for renewable energy, energy storage, heat pumps and hydrogen production. With a total budget of €775 million, 12 projects will develop, build and operate a wide variety of clean solutions, such as electrolysers for green hydrogen production, wind turbines and components, heat pumps, membranes for biogas production, batteries, as well as implement facilities to recycle batteries and critical raw materials.

The Innovation Fund is also contributing towards the NZIA target of reaching 50 million tons annual operational CO₂ injection capacity by 2030. This will facilitate the capture and injection of CO₂ from diverse hard-to-abate sources in energy-intensive industries, such as cement and lime, chemicals, and waste-to-energy. Four projects selected in this call will capture CO₂ and provide 9% of the NZIA target by 2030 or shortly after. Under this call, the development of a new CO₂ storage project and a new CO₂ temporary storage hub has also been selected for funding.

2. Energy-intensive industries:

Europe's energy-intensive industries will be supported in their transition to a low-carbon economy with a variety of innovative climate mitigation technologies. A total of 35 projects were selected in this call and span all sectors covered by the EU Emissions Trading System. These projects cover various indispensable innovations such as the integration of renewable energy, heat and energy storage solutions, recycling/reuse, as well as electrification.  

3. Net-Zero mobility:  

The Innovation fund provides wide support to the transport sector, contributing to the decarbonisation policy objectives under the Renewable Energy Directive, the REFuelEU Aviation, the FuelEU Maritime Regulation, and the Sustainable transport Investment Plan (STIP). Including the results of the IF24 Call, the Innovation Fund is supporting 89 projects related to the transport sector (including new transport technologies, production of sustainable fuels and production of batteries for electric vehicles), which are receiving almost 4.85 billion in grants.

There are 23 selected projects related to decarbonising the transport sector, receiving a total of €1 billion grants.

10 projects concern sustainable fuel production for the transport sector. This includes receiving €153 million in grants for 4 projects focused on the production of electro-Sustainable Aviation Fuel (eSAF), as well as significant investments in other low-carbon fuels: €251 million for 3 eMethanol production projects targeting the maritime sector and €78 million for the production of e-ethanol, biodiesel and bioLNG.

A further 13 projects have been selected to develop innovative transport technologies, with a total investment of €561million. These projects are spread across three sectors: maritime ( 5 projects), road (6 projects, including battery manufacturing for electric vehicles), and aviation (2 projects).

Notable examples include a project to retrofit 15 regional aircraft with hydrogen-electric powertrains, enabling them to operate on national cargo routes, and another project to develop and manufacture hydrogen fuel cell buses for suburban and regional public transport.

Additionally, the development of battery technology for electric vehicles is a key focus area, with five projects receiving €375 million in funding to support the manufacturing of batteries and their components.

Is there a pre-allocation of funding per Member State or other measures that aim to achieve geographical balance?  

The main award criteria for the Innovation Fund's calls for proposals are set out in the recently adopted Delegated Regulation for the operation of the Fund. These criteria are the greenhouse gas emission avoidance potential, degree of innovation, operational, financial, and technical maturity, replicability and cost efficiency. Projects are selected based on the highest scores across all five award criteria. Those that score the highest in the evaluation process in each category are selected within the available budget, irrespective of the sector or location.

Innovation Fund-supported projects are now located in 27 countries in the European Economic Area, and the overall balance is improving with each call. This improvement is also the result of other measures taken to support applications from all eligible Member States, such as supporting National Info Days and reinforcing the application helpdesk, as well as the option for small-scale projects to define innovation based on the state of the art at national level, and not at European level. 

To stimulate this broader geographical balance, there are already several initiatives in place to support Member States in their efforts to develop a high-quality national innovative project pipeline:   

• Following the revision of the EU Emissions Trading System (EU ETS) Directive dedicated Technical Assistance is provided for Member States with low effective participation, aiming to increase the overall quality of the Innovation Fund applications.
• Training sessions for all Member States National Contact Points and the Innovation Fund Expert Group representatives on award criteria, outreach and communication. 
• Support from the Commission's Technical Support Instrument (TSI).

Does the Commission provideProject Development Assistance (PDA)?

The European Investment Bank (EIB) – through EIB Advisory – and the European Commission offer Project Development Assistance to facilitate access to funding for innovative projects that have applied to or fall into the scope of the Innovation Fund.

This service is designed to help projects improve their investment readiness and prepare for Innovation Fund calls for proposals.  Up to 250 projects will be selected for PDA by June 2028.

• Projects that have not yet applied to an Innovation Fund call but wish to improve their project proposal in view of a future application can apply for Open PDA by submitting an application to the EIB here.
  
  
• Projects that have already applied to the Innovation Fund and were not selected for grant despite having met the requirements specified in the call text may be eligible for PDA. Today, the European Commission has shared 183 projects with the EIB for further assessment in view of potential PDA. Successful projects will normally be contacted by the EIB within 3 months.

• More information about project development assistance can be found on the DG CLIMA website or the EIB dedicated page.  

Has the STEP (Strategic Technologies for Europe Platform) Seal been applied to projects awarded under the IF24 Call?

The STEP Seal is the EU's  quality label and is awarded to projects submitted under STEP-relevant calls for proposals, which includes the Innovation Fund. The purpose of the STEP Seal is to help high quality projects attract public and private funding by certifying their quality and contribution to the STEP objectives. A total of 161 projects scored above all Innovation Fund evaluation thresholds. These projects have been awarded the STEP Seal. In addition to the 61 projects selected for funding, this includes an additional 100 projects not selected for a grant, but met all performance criteria.  

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