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Innovation Fund in Transport Sector

Innovation Fund. Some Facts about Transport Sector. Since 2020, the Innovation Fund has supported: Aviation technologies, Road transport technologies, Maritime technologies, Fuel production, Batteries for vehicles

Innovation Fund: number of projects per fuel type, total grant per fuel type

How the Innovation Fund Supports the Decarbonisation of the EU Transport Sector

In a recent publication, the European Commission presented a factsheet on projects supported by the Innovation Fund, with total funding exceeding €4.8 billion.

✅ What is the Innovation Fund?

The Innovation Fund:

is one of the EU’s key financial instruments for deploying net-zero and innovative technologies.
is funded by revenues from the EU Emissions Trading System (EU ETS) and supports the decarbonisation of hard-to-abate sectors.
provides grants to breakthrough projects across a wide range of sectors in the European Economic Area (EEA).

☑️ What technologies in the transport sector does the Innovation Fund support?

the production and use of sustainable fuels
the electrification of transport systems
the manufacturing and recycling of batteries for electric vehicles (EVs)
the construction and retrofitting of low- and zero-carbon ships, aircraft, and heavy-duty vehicles

✅ Key Takeaways:

📌 Out of 272 ongoing and awarded projects, more than one-third focus on transport decarbonisation, receiving around one-third of total grants (€4.8 billion).

📌 Transport-related projects are expected to deliver approximately 29% of the Innovation Fund’s total emission reductions during their first ten years of operation, cutting 334 million tonnes of CO2.

📌 The largest share of mobility projects in the Innovation Fund portfolio relates to fuel production (47 projects). More than 45% of these projects are expected to supply their output exclusively to the transport sector, while the remainder plan to serve multiple off-takers, with transport among the key beneficiaries.

➡️ Source: Driving decarbonisation in mobility through the innovation fund

Posted By : admin 12 Dec, 2025

Updates about RED III and ReFuelEU Aviation in Germany

Updates about Transposition of RED III and ReFuelEU Aviation in Germany

On 10 December, the German Federal Cabinet approved the draft of a Second Law on the Further Development of the Greenhouse Gas Reduction Quota.

This quota, as the central legal instrument for reducing greenhouse gas (GHG) emissions from fuels, shall gradually make refueling more climate-friendly. It specifies the extent to which fuel suppliers must reduce CO2 emissions by using sustainable biofuels, renewable hydrogen-based fuels, or electricity for electric vehicles.

➡️ The Draft of Law is available via this link: Entwurf eines Zweiten Gesetzes zur Weiterentwicklung der Treibhausgasminderungs-Quote

✅ Key Points of the Draft Law:

📌 The draft law implements the amendments to the Renewable Energy Directive (RED III), whose targets must be achieved by 2030. To provide greater investment security, the German government extends the timeline to 2040, going beyond the RED III, to support long-term corporate investment planning.

📌 The law serves to implement the ReFuelEU Aviation Regulation at the national level with regard to fuels.

📌 The draft law includes amendments to the Federal Immission Control Act (BImSchG) and the Regulation on the crediting of electricity-based fuels and co-processed biogenic oils towards the greenhouse gas quota (37th BImSchV).

📌 It introduces definitions of aviation fuel suppliers and distributors, as well as penalties for aviation fuel suppliers that fail to comply with their obligations under the ReFuelEU Aviation Regulation with regard to the share of sustainable aviation fuel (SAF):

EUR 4,700 per tonne for SAF
EUR 17,000 per tonne for synthetic aviation fuels or e-SAF.

📌 It defines the eligibility criteria for e-SAF and renewable hydrogen for aviation.

📌 It establishes minimum shares of RFNBOs for fuel suppliers (excluding aviation fuel suppliers):

0.1% from 2026
0.5% from 2028
1.2% from 2030
1.5% from 2032
2.5% from 2034
4.0% from 2036
5.0% from 2037
6.0% from 2038
7.0% from 2039
8.0% from 2040

☑️ Next Steps:

The law will enter into force on the second day after its publication in the Federal Law Gazette.
The Draft Law must now be submitted to the Federal Council (Bundesrat) and the German Bundestag for debate. Approval by the Federal Council is not required. However, the Bundestag may still introduce amendments.
After adoption by the Bundestag, the law can be submitted to the Federal President for signature and then published.
The legislative process is expected to be completed in the first quarter of 2026.

🔗 Source: Klimafreundlicher tanken, neue Nachfrage für grünen Wasserstoff: Bundesregierung beschließt Gesetzesnovelle zur Treibhausgasminderungs-Quote

Posted By : admin 7 Dec, 2025

2025 Carbon Market Report

On 3 December 2025, the European Commission published the 2025 Carbon Market Report, confirming that the EU Emissions Trading System (EU ETS) continues to function effectively and remains a key pillar of Europe’s climate policy.

As part of the State of the Energy Union Report, the assessment:

▪️ Reviews EU ETS performance in 2024 and early 2025
▪️ Confirms the continued decline in emissions across power and industry.

✅ Key takeaways:

🔹 Overall progress

EU ETS emissions from power and industry are now around 50% below 2005 levels.
The system remains on track for the 2030 target: –62% emissions

🔹 Power & Industry

2024 emissions from power installations fell by almost 11% compared to 2023
Overall fuel combustion emissions across power + industry declined by 9%

🔹 Aviation

EU ETS prices for intra-European aviation increased around 15% in 2024
- ➡️ Key Drivers: continued growth in aviation emissions and expanded coverage, including flights to the EU’s outermost regions
The EU ETS also started rewarding airlines for their use of sustainable aviation fuels (SAF) through additional allowance allocation, and the EU became the first jurisdiction to introduce monitoring and reporting of non-CO2 aviation effects.
SAF incentives under EU ETS
- The ETS carbon price already provides an incentive of around EUR 200 per tonne of SAF used, compared to fossil kerosene.
- Additional ETS support measures implemented in 2025: €500 – €7,000 per tonne of eligible SAF on ETS routes and applicable since 1 January 2024.
- For 2024, the incentive from EU ETS was worth around EUR 25 million, supplemented by ETS support of about 1.3 million allowances worth approximately EUR 100 million
CORSIA alignment
- Limited intra-European EU ETS scope extended to end-2026
- Full application of ICAO CORSIA expected from 2027

🔹 Maritime

2024 marked the inclusion of shipping in the EU ETS
Coverage:
- 100% of emissions between EEA ports & at EEA ports
- 50% of emissions from voyages to/from non-EEA ports
Compliance was high: shipping companies surrendered allowances for more than 99% of their relevant surrendering requirements by the 30 September deadline.
In 2025, shipping companies surrendered allowances for 40% of their 2024 emissions

🔹 EU ETS funding the clean transition

€38.8 billion raised in 2024
Revenues support:
- National climate action
- Clean energy investments
- Innovation Fund
- Modernisation Fund
- Recovery & Resilience Facility (REPowerEU)

☑️ Total ETS revenues now exceed €250 billion

➡️ Source: 2025 Carbon Market Report: EU ETS lowers power sector emissions and expands to maritime transport

Posted By : admin 4 Dec, 2025

New EU funding opportunities

EU Funding Opportunities: + 5,2 billion Euro for clean transition Technologies

Third Auction under the European Hydrogen Bank. Budget: €1.3 billion. Deadline date 19 February 2026 17:00:00 Brusselstime.

🚀 On 4 December 2025, the European Commission has launched three major new funding opportunities under the EU Innovation Fund, mobilising €5.2 billion from EU ETS revenues to support the scale-up of net-zero technologies, clean hydrogen production, and industrial heat decarbonisation.

✅ Main Funding Opportunities:

🔹 IF25 Net-Zero Technologies Call – €2.9 billion

📌 Supporting innovative, mature decarbonisation projects across various scales, including manufacturing of components for:

Renewables & energy storage
Heat pumps
Hydrogen production
EV batteries

📌 Projects are assessed on GHG reduction potential, innovation, maturity, replicability, and cost efficiency.

📌 A new bonus point is introduced for projects led exclusively by SMEs, recognising their role in driving innovation.

📅 Info Day: 16 December 2025

🔹 3rd Auction of the European Hydrogen Bank – €1.3 billion

📌 Scaling up production of RFNBO hydrogen and electrolytic low-carbon hydrogen, including a new topic for aviation and maritime off-takers.

📌 Support is provided via a fixed premium per kg of verified hydrogen produced for up to 10 years, increasing price certainty and bankability for projects.

📅 Info Day: 10 December 2025

🔹 1st Auction for Decarbonising Industrial Process Heat – €1 billion

📌 The auction dedicated to industrial process heat, targeting one of Europe’s largest unaddressed emissions sources.

📌 Supported technologies include:

Heat pumps & electric boilers
Resistance & induction heating
Solar thermal & geothermal heat
Hybrid solutions

📌 Funding is granted as a fixed premium per unit of verified decarbonised heat for up to 5 years, awarded to the most cost-effective CO₂ abatement projects.

📅 Info Day: 16 December 2025

Member States can complement EU funding for high-scoring projects that miss out due to budget limits:

📌 Germany: additional €1.3 billion for RFNBO hydrogen projects

📌 Spain: €465 million total:

€415 million for hydrogen
€50 million for industrial heat decarbonisation

☑️ What’s next?

📌 Applicants are strongly encouraged to attend the Info Day.

📌 Signing of grant agreements:

NZT projects – expected Q1 2027
Auction projects – within 9 months of call closure.

➡️ Source: €5.2 billion of EU Emissions Trading revenues earmarked for clean transition technologies under the Innovation Fund

Posted By : admin 3 Dec, 2025

ACER’s European hydrogen markets 2025 Monitoring Report

The ACER’s European hydrogen markets provides 2025 Monitoring Report a realistic snapshot of the current state of development of the European hydrogen market.

✅ Key Takeaways:

📌 As of October 2025, only two Member States, Denmark and Ireland, have notified the Commission of the completion of RED III transposition.

📌 Despite a strong 51% annual increase in installed electrolyser capacity in the EU in 2024, the installed capacity of 308 MW (2024) and the 1.8 GW capacity under construction still fall well short of a realistic trajectory toward the 2030 EU (40 GW) and Member States (48-54 GW) targets.

📌 At around 8 EUR/kgH2, the average cost of RFNBO hydrogen in the EU currently remains four times higher than that of conventional hydrogen from natural gas (just over 2 EUR/kg).

📌 Electricity supply costs, excluding grid tariffs, may account for up to 50% of the levelised cost of renewable hydrogen, depending on the electricity supply mix, with substantial regional variations across the EU.

📌 Uncertain future demand for renewable hydrogen, driven by the current cost, makes it difficult for hydrogen network operators (HNOs) to align network development with demand evolution, increasing the financial risks associated with this uncertainty. Adaptive network planning, reflecting the latest market trends, is essential to ensure efficient investment and cost control.

📌 Low-carbon hydrogen produced from natural gas with carbon capture and storage (CCS) could support market development and accelerate decarbonisation in some sectors. With current production cost estimates at just below 3 EUR/kg, low-carbon hydrogen with CCS is more competitive than renewable hydrogen.

📌 Funding availability is increasing, but implementation remains slow. The European Commission has allocated more than €20 billion through various hydrogen-related programmes, including auctions under the European Hydrogen Bank. In addition, the EU Hydrogen Mechanism has been launched to facilitate supply–demand matching and accelerate hydrogen market creation.

Hydrogen progress hampered by high costs and slow transposition. Delays in transposing EU rules at national level persist. 2 Member States transposed the amended Renewable Energy Directive into national law.

308 MW electrolyser capacity reached in 2024, way behind EU targets for the year (6 GW). Renewable hydrogen (H2) is 4x more expensive than fossil-based hydrogen. Low-carbon hydrogen could offer a cheaper solution, but cost and technical uncertainties remain. Electricity costs alone account for up to 50% of renewable hydrogen production costs.

➡️ Source: The European Union Agency for the Cooperation of Energy Regulators. European hydrogen markets 2025 Monitoring Report

Posted By : admin 1 Dec, 2025

Small Modular Reactors – Future Development and Deployment in Europe

📢 Call for Evidence: “Small Modular Reactors – Future Development and Deployment in Europe”

On 6 November, the European Commission launched a public consultation to help shape the upcoming EU Strategy on Small Modular Reactors (SMRs).

🗓️ Open until: 4 December 2025

➡️ Participate here: Small modular reactors – future development and deployment in Europe

✅ What is this initiative about?

📌 The Commission plans to adopt an SMR Strategy in Q1 2026 (via a Commission Communication) aimed at creating a supportive industrial, economic, and policy framework to accelerate SMR deployment across Europe with first projects expected in the early 2030s.

📌 The strategy seeks to:

Strengthen the competitiveness of the EU industry;
Foster innovation in nuclear technologies;
Provide a coherent EU approach, complementing national initiatives.

☑️ Why does it matter?

📌 More than 10 EU Member States have already expressed interest in deploying SMRs as part of their national energy and climate plans.

📌 SMRs are seen as a potential source of clean, flexible electricity and heat for residential and industrial use, including low-carbon hydrogen and efuel production.

📌 Key advantages include simplified design, enhanced safety features, factory production, reduced construction and operational costs, flexibility for multiple energy uses, and contributions to grid stability.

✅ Strategy objectives:

Building on the work of the European Industrial Alliance on SMRs, the upcoming Communication will focus on:

Strengthening collaboration to develop a robust EU supply chain
Enhancing regulatory cooperation and streamlining licensing processes
Reinforcing EU leadership in research and innovation, including start-up and scale-up partnerships
Securing a reliable nuclear fuel cycle
Preserving and developing skills and expertise across Europe
Addressing investment barriers
Supporting public engagement and trust-building initiatives

Posted By : admin 16 Nov, 2025

Green Hydrogen & RFNBO Criteria

Institute of Energy Economics at the University of Cologne gGmbH (EWI). Green hydrogen production under RFNBO criteria ‐ Analyzing the system and business case perspective.

Today I took a closer look at a new EWI study: “Green hydrogen production under RFNBO criteria – Analyzing the system and business case perspective” (2025).

✅ Key Takeaways:

This analysis examines the impact of the RFNBO criteria on green hydrogen production from system and business perspectives, with particular attention to how the criteria affect costs, capacity expansion, and the need for system flexibility.

📌 From a system perspective:

Implementing all RFNBO criteria increases electrolysis capacity by over 3% across Europe to meet predefined demand, while average full-load hours decline by around 200 hours.
Applying all RFNBO criteria with hourly matching increases average hydrogen supply costs by around 10 EUR/MWh (+8%) across Europe, driven primarily by additionality requirements and the shift from daily to hourly matching.
In Germany, expected to be the largest hydrogen offtaker in Europe, the impact on marginal hydrogen costs is higher than the EU average (+16%).
These effects highlight distributional impacts between sectors: while marginal electricity costs decline due to surplus renewables entering the market, additional system costs remain within the hydrogen sector. This implies a cost shift from electricity consumers to hydrogen producers.
Average EU electricity costs fall by around 5%, and marginal CO₂ certificate costs by around 2%.
Applying all RFNBO criteria adds over 25 GWel of additional RES capacity across Europe. In Germany, total installed RES capacity increases by 17%.
Adding RFNBO criteria reallocates capacities from the electricity market to hydrogen production.
With stricter temporal correlation requirements, hydrogen production increasingly relies on RES with high full-load hours (onshore and offshore wind), leaving more volatile solar generation to the electricity market.

📌 From a business perspective:

Tighter matching requirements push portfolios toward dedicated renewables and short-term flexibility.
Under Hourly Matching and a baseload supply profile, PV is often combined with large batteries; adding hydrogen storage can shift flexibility from the electricity sector to the hydrogen sector.
Results show that LCOH are more sensitive to constraints from the business perspective: in the baseline, they rise from around 150 EUR/MWh (No Criteria) to almost 180 EUR/MWh (Hourly Matching), an increase of +19%, with the largest jump occurring between Daily and Hourly Matching.
Sensitivity analyses reveal a much stronger impact than in the system perspective, especially under Hourly Matching, where LCOH range from about 170 EUR/MWh up to 370 EUR/MWh.
The difference between Monthly and Hourly Matching spans from roughly 15 EUR/MWh to over 90 EUR/MWh.

➡️ Source: EWI (2025). Green hydrogen production under RFNBO criteria ‐ Analyzing the system and business case perspective.

Posted By : admin 13 Nov, 2025

Hydrogen Mechanism

🔹 New milestone for the EU hydrogen market! 🔹

On 12 November, the European Commission launched the first call for interest under the Hydrogen Mechanism, which is a key step to connect potential suppliers and buyers of renewable and low-carbon hydrogen and its derivatives across the EU.

🔗 Official announcement

🔗 Hydrogen Mechanism platform

💡 What is the Hydrogen Mechanism?

An online platform that supports market development for renewable and low-carbon hydrogen and its derivatives, such as ammonia, methanol, and electro-sustainable aviation fuel (eSAF).

📅 Key timeline:

12 Nov 2025 – 2 Jan 2026: Submission phase: Suppliers are invited to submit supply offers.
19 Jan 2026: Publication of anonymised supply offers.
19 Jan – 20 Mar 2026: Off-takers express their interest.
31 Mar 2026: Results available to participants.

➡️ Why it matters:

Connects future demand and supply, reducing market uncertainty;
Increases transparency and visibility of potential partners;
Facilitates hydrogen infrastructure and financing access;
Encourages market engagement and new business opportunities.

The Hydrogen Mechanism is another important step toward building a hydrogen market.

The Hydrogen Mechanism under the EU Energy and Raw Materials Platform. Update

Submission phase: Opening 12 November 2025 until 2 January 2026. Suppliers are invited to submit supply offers.
Publication of call for interest: 19 January 2026. Publication of anonymised information sheets about the supply offers.
Expression of interest: Opening 19 January 2026 until 20 March 2026. Off-takers are invited to express their interest.
Results: 31 March 2026. Results are available to participants of the call.

Posted By : admin 12 Nov, 2025

World Energy Outlook 2025

☑️ The World Energy Outlook 2025 (WEO-2025) of International Energy Agency considers the following scenarios:

📌 Current Policies Scenario (CPS): A snapshot of policies and regulations that are already in place.

📌 Stated Policies Scenario (STEPS): Encompasses a broader range of policies, including those that have been formally proposed but not yet adopted, as well as other official strategy documents that indicate the intended direction of policy.

📌 Net Zero Emissions by 2050 Scenario (NZE Scenario): Describes a pathway to reduce global energy-related CO₂ emissions to net zero by 2050, while recognising that each country will follow its own route.

☑️ Key Takeaways

📌 Electricity

Electricity demand grows much faster than overall energy use in all scenarios: it rises by around 40% to 2035 in both the CPS and the STEPS, and by more than 50% in the NZE Scenario.
Electricity currently accounts for only 21% of total final energy consumption globally, yet it is the key energy source for sectors representing over 40% of the global economy, and the main energy source for most households.
A pivotal issue for electricity security is the pace at which new grids, storage facilities, and other sources of power system flexibility are developed.
Investments in electricity generation have surged by almost 70% since 2015, reaching USD 1 trillion per year, while annual grid spending has increased at less than half that pace to around USD 400 billion.
The explosive growth in electricity demand for data centres and AI is concentrated in advanced economies and China. Investment in data centres is expected to reach USD 580 billion in 2025. A tripling of electricity consumption by data centres by 2035 will represent less than 10% of total global electricity demand growth, but it will be highly concentrated geographically. More than 85% of new data centre capacity additions over the next ten years are expected in the United States, China, and the European Union.

📌 Renewables

Renewables grow faster than any other major energy source in all scenarios, led by solar photovoltaics.

📌 Nuclear Power

Another common element across scenarios is the revival of nuclear energy, with investment rising in both traditional large-scale plants and new designs, including small modular reactors (SMRs).
More than 40 countries now include nuclear energy in their strategies and are taking steps to develop new projects.

➡️ Source: International Energy Agency. World Energy Outlook 2025

Posted By : admin 3 Nov, 2025

Project Finance for Energy Projects

In this episode of Clean Energy Talks video blog with Shubhda Kaushik, Founder and CEO of Alternative Energy Company, about how Project Finance is driving the Energy Transition.

We explore:

Shubhda’s experience in project finance, strategy consulting, and project development across renewable and clean energy sectors;
The inspiration behind founding Alternative Energy Company and the market gaps it aims to close;
What project finance really means and how it supports large-scale energy infrastructure;
The key factors that make an energy project bankable — from risk assessment to financing structures;
How project finance for hydrogen, e-fuels, and ammonia differs from traditional renewables like wind and solar power.

Whether you’re interested in hydrogen project development, renewable energy investment, or financing sustainable infrastructure, this conversation offers practical insights into how innovative financial models are enabling the global clean energy transition.

➡️ Reach out here on LinkedIn or contact me for more details on the video topic.

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