The European Commission today announced the selection of 61 net zero-focused technology projects to receive €2.9 billion (USD$3.3 billion) of funding, utilizing funds raised through its EU Emissions Trading System (EU ETS).
According to the Commission, the new projects, spanning 19 industrial sectors and 18 countries, will enable 221 million tonnes of CO2e reduction in just their first decade of operations, directly supporting the EU’s goal to achieve climate neutrality by 2050.
Focus areas for the selected projects include solutions for energy-intensive industries, renewable energy and energy storage, net zero mobility and buildings, cleantech manufacturing and industrial carbon management. Projects were selected based on criteria including potential to reduce greenhouse gas emissions, degree of innovation, project maturity, replicability, and cost efficiency.
The new awards will be financed by the EU’s Innovation Fund, from funds raised through the EU ETS. Established in 2005, the ETS puts a price on carbon emissions for key GHG intensive sectors, including electricity and heat generation, oil refineries, steel, cement, paper, chemicals, and commercial aviation, among others. In 2023, EU lawmakers agreed to increase the EU ETS’ scope, raising the direct emissions reductions required by covered sectors, and expanding the system to new sectors. The EU ETS is now expected to generate revenues of approximately €40 billion from 2020-2030.
Funded by the EU ETS, the Innovation Fund is one of the world’s largest funding programmes for the deployment of net zero technologies, and one of the key tools behind the European Green Deal Industrial Plan, aimed at enhancing the competitiveness of the Europe’s net zero industries, and supporting the EU’s transition to climate neutrality. The fund is aimed at creating financial incentives for companies and public authorities to invest in advanced net zero and low carbon technologies.
To date, the Innovation Fund portfolio has grown to 270 projects, with €15.6 billion committed.
The new awards follow the launch of calls by the fund for proposals for €4.6 billion in decarbonization technology funding in December 2024, with €2.4 billion to be allocated to net zero technologies, €1 billion targeted specifically to electric vehicle battery cell manufacturing, and a further allocation of €1.2 billion to accelerate the production of renewable hydrogen. The EU said that grant agreements for the battery and hydrogen calls will be signed this year as well.
The Commission said that the current call attracted 359 applications, requesting a total of €21.7 billion in support.
Wopke Hoekstra, Commissioner for Climate, Net Zero and Clean Growth, said:
“Today’s selection shows that Europe is turning its climate ambitions into industrial reality. The response to this call demonstrates the strength of our innovators and the determination of our companies to lead the global race for net-zero technologies. By investing in home-grown solutions, we are building energy resilience, creating quality jobs and ensuring that Europe remains competitive in the economy of tomorrow.”
