EU allocated 400 million euros for the decarbonisation of industrial heat
The European Commission last week selected 65 projects in 10 countries that will receive a total of 400 million euros from the Innovation Fund for the transition from fossil industrial heat to clean solutions. This is the historic first Europe‑wide auction focused on the decarbonisation of industrial heat.
The auction attracted 85 applications totaling 1.4 billion euros — i.e., 3.5 times more than the available budget. The selected projects cover 10 countries: Austria, Belgium, Czech Republic, Denmark, France, Germany, Hungary, Portugal, Slovenia and Spain.
The auction had three categories and selected:
- 5 projects in the high‑temperature heat category (62.1 million euros)
- 44 medium‑temperature heat projects over 5 MW (286.5 million euros) and
- 16 medium‑temperature heat projects 3–5 MW (47.9 million euros).
The projects, in their first 5 years of operation, will produce approximately 16.3 TWh of decarbonised heat with an installed thermal capacity of 766 MW.
Most projects are based on direct and indirect resistance heating, while others use heat pumps, solar thermal and geothermal technologies, electromagnetic heating or hybrid systems. The sectors include pulp and paper, glass, ceramics, construction materials, steel, food, textiles and the pharmaceutical industry.
It is a pilot project of the future Industrial Decarbonisation Bank, which is part of the upcoming Clean Industrial Deal. It operates on a competitive bidding principle — companies state how much subsidy they need per tonne of CO₂ saved, and the most efficient projects win.
The next round with a budget of €1 billion is already scheduled and will also take place in 2026. Funding comes from EU ETS revenues — thus emitters essentially finance the decarbonisation of industry.
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