Clean Technologies Innovation Fund

The investments are expected to support breakthrough technology projects in energy-intensive infrastructure, hydrogen, renewable energy, carbon capture and storage and the production of key components for the energy storage and renewable energy sectors.

The EU is today investing more than €1.8 billion in 17 innovative large-scale clean technology projects under the third round of grants from the Innovation Fund. Grants will be disbursed from the Innovation Fund to help bring breakthrough technologies to market in the energy-intensive sectors, hydrogen, renewable energy, carbon capture and storage infrastructure, and the production of key components for the energy storage and renewable energy sectors . Selected projects are located in Bulgaria, Finland, France, Germany, Iceland, the Netherlands, Norway, Poland and Sweden.

Statement by Executive Vice-President French carpenterToday’s grants support innovative companies across Europe to develop the very latest technologies we need to drive ecological transformation. The Innovation Fund is an important instrument for scaling up innovation in renewable hydrogen and other solutions for European industry. Compared to the first payment round, the available funds have increased by 60%, allowing us to double the number of projects supported. This is an important incentive for the decarbonisation of the energy-intensive sector in the European Union.

The 17 winning projects were selected in the second large-scale call for proposals, namely those with an investment cost of more than 7.5 million euros. These projects have been assessed by independent experts for their ability to reduce greenhouse gas emissions compared to traditional technologies and to introduce innovations beyond the latest technologies, and whether they are sufficiently developed to be implemented. Other criteria were the scalability and profitability potential of the projects.

The selected projects cover different sectors that contribute to the EU’s decarbonisation efforts. These include sectors responsible for the production, distribution and use of renewable hydrogen, recovery of hydrogen from waste, offshore wind energy, production of photovoltaic modules, storage and recycling of batteries, carbon capture and storage, sustainable aviation fuels and advanced biofuels. Together they can enable us to save 136 million tons of CO₂ equivalent in the first 10 years of use.

In addition, up to 20 projects that are promising but not yet mature enough to receive a grant will be pre-selected for project development support from the European Investment Bank. The list of these projects will be announced in the fourth quarter of 2022.

Projects at a glance

Energy-intensive sectors:

Cement (4 projects): A second generation oxyfuel carbon capture process will be implemented in one of the cement plants in Germany. The carbon dioxide thus obtained is used as raw material for further processing into synthetic methanol. In Poland, a comprehensive carbon capture and storage chain will be created, from CO₂ capture and liquefaction in a cement plant to offshore storage. In France, CO₂ from the flue gases associated with lime production will be captured and permanently stored in geological formations in the sea. A full carbon capture and storage chain will be developed in Bulgaria. Carbon dioxide capture installations in one of the Bulgarian cement plants will be connected to the depleted gas storage facilities in the Black Sea via an onshore and offshore pipeline system.

Chemicals (3 projects): In Finland, plastics will be chemically recycled for further use as raw material in refineries. A unique factory is being built in Sweden for converting carbon dioxide, waste streams, renewable hydrogen and biogas into methanol. Yet another project in Sweden will focus on the production of a new pulp fiber that can replace polyester in textile applications.

Hydrogen (3 projects): In the Netherlands, three projects will respectively: – produce, distribute and use renewable hydrogen by means of offshore wind-powered electrolysers; annual production of 15.5 thousand tons of renewable hydrogen; treat non-recyclable solid waste streams and convert them primarily into hydrogen.

refineries (2 projects): The world’s first commercial drop-in biofuel plant will be built and commissioned in Norway to produce advanced second-generation biofuels and biochar from forest waste. A large-scale plant is being built in Sweden for the production of synthetic, sustainable jet fuel using carbon dioxide captured in a combined heat and power (CHP).

Production of components for the energy storage or renewable energy sectors (3 projects): A factory will be built in Poland for the production of innovative electrochemical battery systems for the storage of electricity in the short term. A factory will be built in the north of France for the production of photovoltaic components based on innovative heterojunction technology. Also in France, in the industrial battery production area of ​​Dunkirk, a lithium-ion battery recycling plant will be built for the production and refining of black mass, which will provide access to a secondary source of raw materials for the production of new batteries.

Renewable energy: An offshore wind farm is being built and commissioned in the German part of the North Sea, in which innovative solutions for turbines and hydrogen are being implemented.

Carbon capture and storage infrastructureA highly scalable carbon dioxide storage terminal with an estimated total capacity of 880 million tons will be built in Iceland.

context

The fund’s revenues come from the EU Emissions Trading System (ETS) and will exceed EUR 38 billion by 2030[1]† The aim is to create the right financial incentives for companies and governments to invest in the next generation of low-carbon technologies and to give EU companies a breakthrough advantage to become a global technology leader.

Under the first large-scale call for projects, €1.1 billion has been awarded to seven projects in the energy-intensive, hydrogen, carbon capture, storage and use and renewable energy sectors. 15 projects received project development support.

Because the resources have increased by 60% compared to the first round of the Innovation Fund, the number of projects eligible for support has more than doubled. We are also expanding our geographic coverage to more countries, including Eastern Europe, and speeding up the application and evaluation process.

For projects selected under the second call for proposals, the process of preparing individual grant agreements with the European Executive Agency for Climate, Infrastructure and Environment (CINEA), the fund’s executive agency, now begins. These contracts are to be completed in the fourth quarter of 2022 so that the Commission can take the relevant grant decision and start paying the grant.

In the autumn, the Commission will launch a third call for proposals for large-scale projects. As announced in the REPowerEU plan, available funding will be doubled to around €3 billion to further support the EU’s independence from Russian fossil fuels. The Commission encourages the re-submission of projects not selected in previous calls.

In July 2021, as part of the Ready for 55 package, the Commission proposed to increase the Innovation Fund, currently based on 450 million allowances under the current ETS for 2021-2030, by 50 million allowances under the current ETS and 150 million allowances under the new ETS a system for emissions from road transport and buildings. In addition, it proposed that allowances that would otherwise be allocated free of charge to industries subject to a CO₂ border adjustment mechanism be auctioned and credited to this fund.

Extra information

Description of selected large-scale projects

Website of the innovation fund

Large-scale projects supported by the Innovation Fund

Large-scale projects selected under the first call
Small-scale projects selected under the first call
Proposal for a revised EU ETS Directive
Delivering on the European Green Deal

[1] estimate based on a CO2 price of € 75 / ton CO₂

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