(Updated on 10 December 2025)

What is the Innovation Fund?

The Innovation Fund (IF) is one of the EU‘s largest funding programmes for demonstrations. It is one of the EU‘s most important funding instruments for the demonstrating and introducing innovative, climate-neutral technologies to the market. Financed by revenues from the EU Emissions Trading Scheme (EU ETS), it will provide around €40 billion between 2020 and 2030 for projects contributing to decarbonisation, renewable hydrogen production and the electrification of industrial process heat.

Unlike traditional research programmes such as Horizon Europe, the Innovation Fund is designed as a financing instrument. The European Commission regularly publishes thematic calls, including Net-Zero Technologies Calls, Large-Scale Calls, Medium-Scale Calls and Small-Scale Calls, as well as technology-specific competitive procedures (Auction Calls).

Innovation Fund Calls: Regular calls for proposals on the Funding & Tenders Portal

New calls for project submissions will be published continuously throughout the programme's duration. The Net-Zero Technologies calls are divided into five categories:

Large-Scale Calls – large-scale projects

• For projects with total capital costs exceeding €100 million
• Focus on large-volume, transformative technologies
• ideal for industrial demonstration and market introduction projects

Medium-scale calls

• Project sums between €20 million and €100 million
• The exact upper limit depends on the respective call

Small-scale calls – small-scale projects

• For projects with total capital costs below €7.5 million
• Suitable for pilot projects, early demonstration projects and innovative SMEs

Manufacturing Facilities

• Project sum above €2.5 million
• Promotion of production capacities for components in the following areas:
• Renewable energies
• Electrolysers
• Fuel cells
• Energy storage
• Heat pumps

Pilot Projects

• Project sums from £2.5 million, funding up to £40 million
• Support for early-stage technologies and technological breakthroughs
• This structure enables targeted funding for both ambitious large-scale projects, as well as smaller, agile clean tech innovations.

Further information on current and planned calls for proposals can be found on the European Commission's website: Innovation Fund – Calls for proposals

Objectives of the Innovation Fund

The Innovation Fund supports projects that:

• significantly reduce greenhouse gas emissions
• demonstrate innovative climate-neutral technologies
• accelerate industrial transformation
• strengthen Europe's competitiveness in the clean technology sector
• create economic growth and skilled jobs

Which technologies are supported?

Industry and energy-intensive sectors

• Steel, chemicals, cement, glass and ceramics
• Climate-neutral production processes

CO₂ capture, utilisation and storage (CCU/CCS)

• Carbon capture and storage
• Carbon-to-X processes

Renewable energies and energy storage

• Innovative solar and wind technologies
• Green hydrogen and hydrogen systems
• Long-term storage

Mobility and transport

• Climate-neutral shipping
• Aviation solutions
• Low-emission heavy-duty logistics

Net-zero buildings and infrastructure

• Integrated energy systems
• Heating networks
• Innovative building technologiesIntegrated energy systems

Funding types, funding rates and evaluation criteria

Funding types

• Calls for proposals for large-, medium- and small-scale projects
• Competitive procedures (auctions) for clearly defined technologies, e.g. green hydrogen

Funding rates

• Up to 60% of eligible costs
• Up to 100% in certain auctions (market-based instruments)

Evaluation criteria

• Contribution to greenhouse gas reduction
• Degree of innovation
• Technical maturity and scalability
• Cost efficiency
• European added value

Who can apply?

• Companies of all sizes
• Research institutions
• Industrial consortia
• Start-ups, SMEs and technology providers
• Public and private organisations

Conclusion

The Innovation Fund is a vital EU funding instrument for achieving climate neutrality. It provides significant EU funding for both large-scale industrial projects and smaller, innovative ventures, and offers Bavarian companies and research institutions, in particular, excellent opportunities to raise the profile of their clean technology solutions across Europe.

EU Commission: What is the Innovation Fund?
CINEA – Innovation Fund

Are you planning a clean technology project, or are you interested in receiving funding from the Innovation Fund? BayFOR can support you throughout the process, from project conception to application. Contact us for a free initial consultation!