BRUSSELS, Belgium / EuroWire.IO / – The European Commission has allocated €3.4 billion from the Innovation Fund to support 77 projects focused on achieving net-zero emissions. The announcement of the fund’s net-zero technologies call results was made on October 19. This funding is derived from proceeds generated by the EU Emissions Trading System. Projects selected span 23 countries within the European Economic Area and encompass a broad spectrum of clean industrial technologies.
The Commission projects that these initiatives could prevent approximately 290 million tonnes of carbon dioxide equivalent emissions during their first decade of operation, which translates to roughly one tonne every second over ten years. These projects aim to bolster Europe’s dominance in clean technology and enhance its competitiveness. Additionally, they are expected to promote energy independence and security, contributing to the EU’s climate neutrality target set for 2050.
Wopke Hoekstra, the Commissioner for Climate, Net Zero and Clean Growth, highlighted that the projects exemplify how European innovators are translating climate goals into industrial leadership. He emphasized that reinvesting revenues from the carbon market supports companies in bringing clean technologies to market. The call, launched in December 2025, attracted 358 applications requesting a total of €17.5 billion, surpassing the available budget of €2.9 billion. All five focus areas of the call experienced oversubscription. The Innovation Fund stands as one of the world’s largest programs financing pioneering low-carbon technologies.
Major projects in scale and manufacturing dominate funding allocation
Twelve large-scale initiatives requested around €1.58 billion, representing the largest portion of the total funding. An additional 12 projects in clean-tech manufacturing sought nearly €895 million. Seventeen medium-scale projects were selected, with a combined value of about €458 million. Small-scale projects, totaling 20, asked for roughly €124 million, while 16 pilot projects aimed for approximately €394 million. The portfolio includes projects across sectors such as energy-intensive industries, renewable energy, energy storage, and net-zero mobility. All five categories contribute to the 77 projects chosen.
For the first time, the Innovation Fund will back a small modular nuclear reactor project as well as its inaugural direct air carbon capture and storage initiative. Six projects focus on the processing and recycling of critical raw materials, including rare earth permanent magnets and batteries. Other initiatives involve developing advanced alternative fuels and managing industrial carbon emissions. The EU has previously supported clean industry projects through the same fund.
Funding agreements anticipated in early 2027
An additional 84 projects passed the evaluation process but are unable to receive funding due to budget constraints. These, along with the 77 selected projects, will be granted the STEP Seal quality label to facilitate access to other sources of financing. Furthermore, 160 proposals remain eligible for project development support from the European Investment Bank. Evaluations by independent experts considered criteria such as emissions reduction potential, innovation, maturity, scalability, and cost-effectiveness. The seal is an element of the Strategic Technologies for Europe Platform.
Currently, the selected project promoters are preparing grant agreements with the European Climate, Infrastructure and Environment Executive Agency. The Commission anticipates announcing the results of this process in the first quarter of 2027. The upcoming Innovation Fund calls are scheduled to open in early December 2026, including a €1 billion topic focused on clean-tech manufacturing. The fund also manages hydrogen and industrial heat auctions. Its portfolio now encompasses approximately 320 projects with nearly €17 billion committed.