BRUSSELS, Belgium / EuroWire.IO / – The European Commission has allocated €3.4 billion in funding from the Innovation Fund to support 77 net-zero technology initiatives across 23 nations within the European Economic Area. Announced on October 19, the selected projects represent a diverse array of clean industrial technologies funded through revenues from the EU Emissions Trading System.
According to the Commission, these projects could prevent approximately 290 million tonnes of carbon dioxide equivalent emissions within their first decade of operation, equating to about one tonne per second over ten years. They aim to bolster Europe’s leadership in clean technology, enhance energy independence, and contribute to the EU’s climate neutrality target set for 2050.
Wopke Hoekstra, Commissioner for Climate, Net Zero, and Clean Growth, highlighted that these initiatives demonstrate European innovators transforming climate ambitions into industrial dominance. He emphasized that reinvesting revenues from the carbon market facilitates the market entry of clean technologies. The call, launched in December 2025, attracted 358 applications requesting a total of €17.5 billion against a budget of €2.9 billion. All five categories of the call were oversubscribed. The Innovation Fund remains one of the world’s most substantial funding sources for pioneering low-carbon innovations.
Major Projects and Manufacturing Initiatives Receive Most Funding
Twelve large-scale projects sought roughly €1.58 billion, representing the largest portion of the funds. An additional 12 clean-tech manufacturing projects requested nearly €895 million, while 17 medium-scale projects secured about €458 million. Smaller projects, totaling 20, asked for approximately €124 million, and 16 pilot initiatives aimed for around €394 million. The funded projects span sectors such as energy-intensive industries, renewable energy, energy storage, and net-zero mobility, collectively covering all five categories.
For the first time, the Innovation Fund will support a small modular nuclear reactor project and fund its inaugural direct air carbon capture and storage initiative. Six projects focus on critical raw materials processing and recycling, including rare earth magnets and batteries. Other selected endeavors explore alternative fuels and industrial carbon management. Previously, the same fund supported clean industry projects.
Grant Agreements Expected by Early 2027
An additional 84 projects, evaluated but not funded due to budget constraints, will receive the STEP Seal quality label, aiding their efforts to secure additional financing. Moreover, 160 proposals remain eligible for development assistance from the European Investment Bank. These bids were assessed based on emissions reduction, innovation, maturity, replicability, and cost-effectiveness by independent experts. The seal forms part of the Strategic Technologies for Europe Platform.
The selected project promoters are now preparing grant agreements with the European Climate, Infrastructure and Environment Executive Agency, with results anticipated in the first quarter of 2027. The upcoming calls for the Innovation Fund are scheduled for early December 2026, including a €1 billion funding opportunity for clean-tech manufacturing. The fund also manages hydrogen and industrial heat auctions. Its current portfolio encompasses approximately 320 projects with nearly €17 billion committed.