BRUSSELS, Belgium / EuroWire.IO / – European Commission has allocated €3.4 billion from the Innovation Fund to support 77 net-zero technology initiatives. The announcement of these funding outcomes, resulting from the fund’s call for net-zero technologies, was made on October 19. This funding source is derived from revenues generated by the EU Emissions Trading System. The selected projects are distributed across 23 nations within the European Economic Area and encompass a broad spectrum of clean industrial technologies.
It is estimated by the Commission that these initiatives could prevent approximately 290 million tonnes of carbon dioxide equivalent emissions during their initial decade of operation, which averages roughly one tonne every second over ten years. These projects are anticipated to bolster Europe’s leadership in clean technology and enhance its industrial competitiveness. Additionally, they are expected to promote energy independence and security. Contributing to the EU’s objective of climate neutrality by 2050, the funding plays a crucial role in this strategic effort.
Wopke Hoekstra, Commissioner for Climate, Net Zero and Clean Growth, highlighted that these projects exemplify how European innovators are transforming climate ambitions into industrial leadership. He emphasized that reinvesting revenues from the carbon market assists companies in bringing clean technologies to market. The call, launched in December 2025, attracted 358 applications requesting a total of €17.5 billion, against an available budget of €2.9 billion. All five categories of the call were oversubscribed. The Innovation Fund stands as one of the world’s most significant funding programs for pioneering low-carbon technologies.
Funding primarily directed towards large-scale and manufacturing initiatives
Twelve projects at large scale sought approximately €1.58 billion, representing the largest share of the fund. An additional 12 projects focused on clean-tech manufacturing requested nearly €895 million. Seventeen medium-scale projects, valued at around €458 million, were also selected. Small-scale initiatives, totaling about €124 million, comprised 20 projects, while 16 pilot ventures aimed for roughly €394 million. The portfolio spans sectors such as energy-intensive industries, renewable energy, energy storage, and net-zero mobility. These five categories collectively encompass all 77 chosen projects.
For the first time, the Innovation Fund will support a small modular nuclear reactor project, along with its inaugural direct air carbon capture and storage project. Six projects are dedicated to processing and recycling critical raw materials, including rare earth magnets and batteries. Other selected projects involve advanced alternative fuels and strategies for industrial carbon management. The EU’s support for clean industry projects through the same fund has been previously documented.
Anticipated grant agreements in early 2027
A total of 84 projects successfully passed the evaluation but could not be awarded funding due to budget constraints. These projects, along with the 77 selected, will receive the STEP Seal quality label to facilitate attracting additional financing. An additional 160 proposals remain eligible for project development assistance from the European Investment Bank. Independent experts assessed the proposals based on criteria such as emissions reduction, innovation, maturity, replicability, and cost efficiency. The seal forms part of the Strategic Technologies for Europe Platform.
The approved project promoters are now preparing grant agreements with the European Climate, Infrastructure and Environment Executive Agency. The Commission anticipates revealing the results of this process in the first quarter of 2027. Upcoming calls for the Innovation Fund are scheduled to open in early December 2026, including a €1 billion initiative focused on clean-tech manufacturing. Additionally, the fund manages hydrogen and industrial heat auctions. Currently, the fund’s portfolio comprises around 320 projects with nearly €17 billion committed.