The European Commission has opened this year’s Innovation Fund with a budget of €4 billion (US$4.4 billion) to support the development of decarbonisation technologies.
Allocated funds for cleantech manufacturing – for renewable energy, energy storage, heat pumps and hydrogen production on projects with capital expenditure (CAPEX) above €2.5 million – has been doubled with €1.4 billion available to “strengthen industrial manufacturing capacity, technology leadership, and supply chain resilience in Europe”.
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The new Innovation Fund comes only a few days after the European Parliament voted in favour of the Net Zero Industry Act (NZIA) which will seek to onshore manufacturing for renewable energy technologies, including solar PV and energy storage.
The grant for the latest Innovation Fund will be divided into five categories with different budgets and CAPEX requirements, three of which are for general decarbonisation, depending on the size of the projects.
For large-scale projects, a budget of €1.7 billion will be available for projects with a CAPEX above €100 million, while medium-scale and small-scale projects will have a budget of €500 million and €200 million, respectively and a CAPEX between €20 to €100 for medium-scale and €2.5 and €20 million for small-scale projects.
The fourth category is for cleantech manufacturing with a budget of €1.4 billion, as described above, while the last one is for pilot projects with €200 million available for projects with a CAPEX above €2.5 million focusing on deep decarbonisation.
Up to 60% of a project’s relevant costs can be covered through the EC’s Innovation Fund, and will be assessed based on their potential to reduce greenhouse gas emissions, innovation, maturity, replicability and cost efficiency.
“The Innovation Fund is our key tool to support European industries in the transition to climate neutrality. More and more innovative projects are announced in Europe every day. The Innovation Fund ensures that the most promising ones in terms of emission reductions and scalability come to fruition. On the road to net zero, we need to combine climate imperatives with economic opportunities. With a larger budget and €1.4 billion dedicated to manufacturing clean technologies, this year’s call shows our determination to think big and move fast,” said Wopke Hoekstra, Commissioner for Climate Action.
Among projects that were awarded in previous rounds was REC Solar’s 2GW heterojunction solar manufacturing plant in France last year, which was later on shelved due to “changes in market conditions”, as well as Enel Green Power’s 3GW bifacial heterojunction module manufacturing plant in Catania, Italy.
Earlier this year, Spanish utility Iberdrola sought EU funding from the EC’s Innovation Fund for a 1.6GW solar module assembly plant in Spain, however, it is unclear if that project was related to another module assembly plant the company is involved in partnership with Spanish module manufacturer Exiom.
Both companies unveiled earlier this year that they aim to build a tunnel oxide passivated contact (TOPCon) module assembly plant with an annual production capacity of 500MW in the Asturian region of Langreo, northwest of Spain. The project received its first machinery shipment last month, which consisted mainly of laminating machines.
Applications for projects have until 9 April 2024 to apply through the EU Funding and Tenders Portal, which can be accessed here. Successful applicants will be informed in the fourth quarter of 2024 with grant agreements signed in Q1 2025.
For more information regarding energy storage and the Innovation Fund, our sister site Energy-storage.news covered the announcement here.
