BRUSSELS, Belgium / EuroWire.IO / – As of October 19, the European Commission announced that 77 net-zero technology projects will receive a total of €3.4 billion from the Innovation Fund. This funding comes from revenues generated by the EU Emissions Trading System and supports initiatives across 23 countries within the European Economic Area. The projects encompass a broad array of clean industrial technologies.
The Commission projects that these initiatives could prevent approximately 290 million tonnes of carbon dioxide equivalent emissions over their initial decade of operation. This figure roughly corresponds to one tonne every second over ten years. The funding aims to bolster Europe’s leadership and competitiveness in clean technology sectors, while also advancing energy independence and security. Ultimately, these efforts align with the EU’s objective to achieve climate neutrality by 2050.
Wopke Hoekstra, the Commissioner for Climate, Net Zero, and Clean Growth, highlighted that the projects exemplify how European innovators are translating climate ambitions into industrial leadership. He emphasized that reinvesting revenues from the carbon market assists companies in commercializing clean technologies. The call for proposals, launched in December 2025, attracted 358 applications requesting €17.5 billion, despite a budget of only €2.9 billion. All five categories of the call were oversubscribed. The Innovation Fund stands as one of the world’s largest programs dedicated to financing innovative low-carbon solutions.
Major projects and manufacturing efforts dominate the funding distribution
The largest share, approximately €1.58 billion, was requested by 12 large-scale projects. An additional 12 projects focused on clean-tech manufacturing asked for nearly €895 million. Seventeen medium-scale projects, valued at about €458 million, were selected, along with 20 smaller initiatives requesting around €124 million. Furthermore, 16 pilot projects aimed for roughly €394 million. These projects span sectors such as energy-intensive industries, renewable energy, energy storage, and net-zero mobility, collectively representing all five thematic areas.
For the first time, the Innovation Fund will support a small modular nuclear reactor project, alongside its inaugural direct air carbon capture and storage project. Six initiatives concentrate on processing and recycling critical raw materials, including rare earth permanent magnets and batteries. Other selected efforts involve advanced alternative fuels and industrial carbon management. Previously, the European Commission has backed clean industry projects through the same funding mechanism.
Funding agreements anticipated in early 2027
In addition to the 77 projects chosen, 84 others passed the evaluation but could not be funded due to budget constraints. Both groups will be awarded the STEP Seal quality label, which is intended to help attract additional financing. Moreover, 160 proposals remain eligible for project development assistance provided by the European Investment Bank. Experts independently assessed the submissions based on emissions reduction potential, innovation, maturity, replicability, and cost-effectiveness. The seal forms part of the Strategic Technologies for Europe Platform.
Currently, the selected project promoters are preparing grant agreements with the European Climate, Infrastructure and Environment Executive Agency, with an expected announcement of results in the first quarter of 2027. The upcoming calls for the Innovation Fund are scheduled to open in early December 2026, including a €1 billion focus on clean-tech manufacturing. Additionally, the fund manages hydrogen and industrial heat auctions. Its portfolio now comprises around 320 projects with nearly €17 billion committed.
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