Decarbonization of industry: Launch of a new financial aid scheme

The energy transition is a major challenge for companies, especially for industry, which represents a significant share of greenhouse gas emissions. To support companies in their transition to a low-carbon economy, as part of the France 2030 plan, ADEME has renewed for 2023 its financial aid scheme called “Decarbonation of industry – DECARB’IND”.

Endowed with €125 million for the first shift in June 2023, the objective of this call for projects is to support companies in the implementation of projects to reduce their energy consumption and their GHG emissions. The system is aimed at any industrial site and projects allowing a reduction in GHG emissions of more than 1,000 tCO_2eq per year at iso-production within the scope of the industrial company concerned. Projects must present investments of more than €3 million, and a request for aid of less than €30 million.

Reduction of greenhouse gas emissions from industrial sites following four themes

ADEME has grouped the industry’s decarbonization objectives into 4 themes, which represent the types of operations sought by this call for projects:

Theme 1 – reduction of GHG emissions through energy efficiency

Eligible projects under this theme concern:

• the replacement, or implementation, of an industrial process, or utility, with more energy-efficient equipment, or technology, excluding fossil combustion equipment
• the installation of heat recovery equipment, if not already eligible for the Heat Fund (Fonds Chaleur)
• the recovery of fatal fuel in 100% thermal form, when this operation is associated with other eligible actions, or via cogeneration.

Theme 2 – reduction of GHG emissions through to a modification of the energy mix

Eligible projects under this theme concern:

• the replacement, or implementation, of an industrial process, or utility, with equipment, or technology, leading to a reduction in GHG emissions by switching to electric vectors
• the integration of renewable, or recovered, thermal energies not already covered by the Heat Fund of ADEME, making it possible to replace fossil fuels

Theme 3 – reduction of GHG emissions through a modification of the material mix

Eligible projects under this theme concern:

• the implementation of recycling processes and/or the use of recycled materials, or material efficiency processes, leading to a reduction in GHG emissions
• the modification of processes integrating alternative raw materials leading to a reduction in GHG emissions
• the implementation of equipment, technology or a new chemical process to reduce GHGs other than CO₂, such as methane, hydrofluorocarbons (HFCs), etc.
• the use of low carbon hydrogen for material use

Theme 4 – CO₂ capture, storage and use

Eligible projects under this theme concern:

• carbon capture and sequestration (under certain conditions)
• carbon capture and use, only for mineralization projects

Note that other industry decarbonization projects could also be considered, provided they are not already covered by other financing schemes.

Twelve eligibility criteria

Investment projects in the productive apparatus and/or in utilities are eligible if they meet the twelve eligibility criteria of the call for projects, including:

• an amount of investment greater than €3 million (total cost of CAPEX of the project on the same industrial site defined by its SIRET number)
• a request for aid strictly less than €30 million
• a reduction in emissions of at least 1,000 tCO_2eq per year at iso-production, by comparing an initial situation and the expected post-project situation
• the presentation of a precise roadmap of the decarbonization trajectory of the site by 2030 and 2050, detailing the planned decarbonization projects
•  Industrial sites using fossil fuels as energy sources will have to define a plan to phase out coal and/or fuel oil and convert to thermal renewable energies

The maximum aid rates applied to the eligible cost base are defined according to the themes of the projects and recalled in the table below:

The eligible expenditure base corresponds to the additional cost of the operation compared to a reference or counterfactual scenario which would be less virtuous for the environment or energy efficiency.

Companies interested in the DECARB’IND system must submit their application file to ADEME. Applications are examined by a committee of experts who assess their relevance and consistency with the objectives of reducing greenhouse gas emissions.

This call for projects has two possible deadlines for file submission: June 27, 2023 and December 12, 2023.

Through this new financing scheme, ADEME seeks to support companies in their transition to a lower carbon economy, while promoting innovation and the competitiveness of French companies.