The Innovation Fund is one of the world’s largest funding programs for the demonstration of innovative low-carbon technologies. It grants funding for projects aimed at the commercial deployment of low-carbon technologies, with the goal of decarbonizing the European Union (EU) and supporting its transition to climate neutrality.
In the last edition (IF23), the Innovation Fund selected 85 projects from 337 applications from 27 countries, to receive public support of €4.8 billion. These projects plan to reduce greenhouse gas emissions by 476 million tons of CO2 equivalent over ten years.
The IF24 Innovation Fund calls for projects were published on December 3, 2024. A budget of €4.6 billion is dedicated to this edition, with a potential extension to €5.5 billion, subject to the availability of resources.
As a continuation of the 2023 program, the fund will finance direct decarbonization projects, production of components and equipment necessary for decarbonization, renewable hydrogen production projects and net-zero mobility projects linked to innovative disruptive technologies and infrastructure facilitating the development of sustainable alternative fuels in the maritime and aviation sector. Activities involving Carbon Capture and Utilization (CCU) in an environmentally safe manner as well as geological storage of CO2 (Carbon Capture and Storage – CCS) are also included in the program.
One of the main novelties of this edition is the creation of a call for projects dedicated to the production of batteries for electric vehicles, with an estimated budget of 1 billion euros.
The deadline for submitting an application is April 24, 2025, except for renewable hydrogen production projects for which the deadline is February 20, 2025.
General decarbonization
The program will support the construction and operation of direct decarbonization solutions, in particular, the financing of equipment to increase the electrification and energy efficiency of industrial processes in sectors subject to the European carbon market (EU-ETS).
Production of components and equipment for decarbonization
This component finances the construction of manufacturing facilities for specific components needed for the decarbonization of the EU. The 2024 program has a particular focus on financing new production facilities for battery cells for Electric Vehicles (EVs) with a budget of around €1 billion.
Funded projects may also include the recycling of batteries or battery materials and the production of upstream components such as:
- cathode precursor materials (pCAMs);
- cathode active materials (CAMs);
- anode active materials (AAM);
- electrolytes; or
- separators.
As for the previous edition, support for projects dedicated to the production of other equipment necessary for decarbonization will also be possible. In particular, manufacturing projects will be supported, including:
- components for renewable energies (photovoltaics, onshore and offshore wind energy, marine energy, geothermal energy, solar thermal energy);
- electrolyzers and fuel cells for the production and consumption of hydrogen;
- heat pumps; and
- energy storage solutions (excluding EVs).
Note: A tax credit, the Green Industry Tax Credit (“C3IV” in French), pursues similar objectives and allows the financing, up to €200 million in metropolitan France, of component and equipment production projects in four key sectors: wind power, batteries, heat pumps and photovoltaic panels. Check out our video: “Few minutes to understand the C3IV”
Pilot projects
The objective of this topic is to support highly innovative, disruptive or revolutionary projects and technologies that enable the deep decarbonization needed to achieve climate neutrality. The following activities can be funded under the pilot projects: the construction and operation of the pilot projects focused on the validation, testing and optimization of highly innovative and in-depth solutions. If successful, the technology is expected to progress to large-scale demonstration or one-of-a-kind commercial production.
A higher degree of innovation is expected than in the other themes of the Innovation Fund. Projects usually have a limited lifespan of 3 to 5 years. The maximum grant amount for an individual project under the pilot projects is limited to €40 million.
Production of renewable hydrogen
The objective of this component is to support the production of renewable hydrogen of non-biological origin in Europe. Only projects with a minimum installed capacity of the electrolyzer of 5 MWe are eligible.
The call for projects is organized in the form of an auction and will subsidize the difference between the expected revenue from the sale of a hydrogen unit and the levelized cost of that unit. This bonus will be granted for a maximum period of 10 years.
The budget available for this component is €1.2 billion.
How can Deloitte France help you?
We offer a full range of services to optimize the chances of success of your project:
- Compliance assessment: We ensure that your project meets all eligibility requirements, setting you up for success from the start.
- Full project support: We provide full support throughout the entire application process, from the initial project definition and viability analysis to the detailed drafting of the application to the signing of the grant agreement and reporting.
Feel free to contact any of the people below for more information.