With more than 40 billion euros earmarked for industrial decarbonization, the Innovation Fund (Innovation Fund) is now one of the European Union’s leading funding programs for the demonstration and commercial deployment of low-carbon technologies. TheInnovation Fund 2025 finances the decarbonization of industrial processes across Europe.
Managed by the European Commission (DG Climate Action) and implemented by the CINEA – the European Climate, Infrastructure and Environment Executive Agency-this Fund is a key pillar of the European strategy towards climate neutrality by 2050.
Between December 2025 and February 2026, the IF25 Heat Reverse Auction designed to provide grants for interventions to decarbonize heat in industrial processes will open. The IF25 Heat Auction represents a unique opportunity for companies that want to reduce CO₂ emissions in thermal processes.
Fundable Technologies IF25 Heat Auction
Eligible IF25 HEAT interventions are as follows:
High-temperature heat pumps;
Electric heat generators and/or electric heat storage systems.
Heat generation systems on process (e.g., furnaces, dryers) with direct or indirect electrical resistance, electromagnetic, dielectric, or plasma heating;
Solar thermal or geothermal for industrial processes
Hybrid projects involving mix of technologies.
Innovation Fund 2025 budget and categories
Budget 1 billion euros, divided into three categories according to the potential of interventions:
150 M€ for interventions producing heat between 100 °C and 400 °C and from 3 MWth to 5 MWth (Max 100 M€ per individual project) .
350 M€ for interventions producing100 °C and 400 °C and > 5 MWth. (Max 100 M€ per individual project) .
500 M€ for interventions that produce heat > 400 °C. (Max 250 M€ per individual project)
The grant could potentially cover up to 100 percent of capital expenditures.
Cumulation with local grants for capital and operating expenses is not allowed.
Firms compete with each other by offering the lowest public subsidy required to produce a given output
In order to make the best use of the available subsidies, the grants are awarded on the basis of a downward auction on the cost of CO2 avoided, based on two parameters:
The extent of CO2 emission reduction assessed on ETS parameters over the 5 years of operation of the intervention,
Amount of percentage contribution requested based on eligible expenses incurred.
Practical example
For example, consider a heat pump producing process heat (>3 MWth, > 100°C), characterized by an investment of 3 M€, an annual reduction of 3000 tCO2_eq/year or 15,000 tCO2_eq in 5 years is expected.
The company requests a contribution of €2 M (66% of investment costs) for an intervention that produces a saving of 15,000 tCO2_eq, which would correspond to an offered cost of CO2 reduction of €133/tCO2_eq
The allocation of funds will reward companies that submit a bid characterized by higher CO2 reduction cost efficiency, i.e., lower cost per reduced tCO2 (< €/tCO2) ;
The role of ESCos in the innovation fund 2025
CO2 savings at the time of application will be estimated by a qualified and independent third-party certifier (e.g., ESCo), but then it will be necessary to actually measure it with certified and sworn instrumentation, again by a third party;
Disbursement of grants will be made for the first 5 years of production in semi-annual installments based on actual thermal energy production measured and certified by the ESCo.
Accessing Innovation Fund calls requires careful technical, economic and strategic planning. The documentation to be submitted (business plan, feasibility studies, LCA analysis, CO₂ reduction plans) is complex and must meet strict European standards.
Technical and financial support Innovation Fund 2025
With the consulting support of White Energy Group, enterprises can:
Obtain technical and financial assistance for the application;
Structure the documentation according to the requirements of the European Commission;
White Energy supports companies in identifying solutions, technologies best suited to start a process decarbonization journey through its Orange Start consulting offerings.
As an ESCo, it can deal with
Identification of processes that can be improved and electrified and the best technologies for process decarbonization;
Check the feasibility of its project if the company has already identified an intervention;
Preparation of ex ante and ex post measures in order to maximize scoring in the innovation and climate impact criteria;
Structure the documentation according to the requirements of the European Commission in order to increase the chances of obtaining funding;
Periodic reporting of the performance of interventions and emission reduction functional to the semi-annual grant disbursement by IF Heat.
EnPC Green Heat and PPA Green Solar offer.
As an ESCo can through its Energy Performance Contract (EnPC) Green Heat offering, it can directly invest in industrial customers’ processes, directly financing the interventions and sharing the savings and CO2 emission reductions with customers.
Whitenergy complements these solutions with its Green Solar PPA offerings that provide electricity from renewable sources at prices competitive with the cost of fossil energy taken from the grid in order to make the decarbonization and electrification of its processes even more affordable.
The competitive advantage for your business
The Innovation Fund represents a unique opportunity for Italian companies that want to reduce emissions, improve efficiency and innovate their production processes.
This is not just an economic contribution, but a strategic investment in the future of European industry.
With technical support from White Energy Group, companies can access Innovation Fund 2025 grants with a targeted strategy.
Want to know if your company can access the Innovation Fund? Book a free consultation with the White Energy Group team: we will analyze your project together and guide you step by step through the application.
Discover the latest news from the world of energy efficiency: news, events, webinars and projects that tell the story of our commitment to a more sustainable industry.
What is the Innovation Fund 2025
With more than 40 billion euros earmarked for industrial decarbonization, the Innovation Fund (Innovation Fund) is now one of the European Union’s leading funding programs for the demonstration and commercial deployment of low-carbon technologies. TheInnovation Fund 2025 finances the decarbonization of industrial processes across Europe.
Managed by the European Commission (DG Climate Action) and implemented by the CINEA – the European Climate, Infrastructure and Environment Executive Agency-this Fund is a key pillar of the European strategy towards climate neutrality by 2050.
Who can participate in the Innovation Fund 2025
The Innovation Fund divided into several auctions is designed for enterprises, public and private entities operating in the following areas:
When IF25 Heat Auction opens
Between December 2025 and February 2026, the IF25 Heat Reverse Auction designed to provide grants for interventions to decarbonize heat in industrial processes will open. The IF25 Heat Auction represents a unique opportunity for companies that want to reduce CO₂ emissions in thermal processes.
Fundable Technologies IF25 Heat Auction
Eligible IF25 HEAT interventions are as follows:
Innovation Fund 2025 budget and categories
Budget 1 billion euros, divided into three categories according to the potential of interventions:
The grant could potentially cover up to 100 percent of capital expenditures.
Cumulation with local grants for capital and operating expenses is not allowed.
How does the IF25 competitive auction work?
Firms compete with each other by offering the lowest public subsidy required to produce a given output
In order to make the best use of the available subsidies, the grants are awarded on the basis of a downward auction on the cost of CO2 avoided, based on two parameters:
Practical example
For example, consider a heat pump producing process heat (>3 MWth, > 100°C), characterized by an investment of 3 M€, an annual reduction of 3000 tCO2_eq/year or 15,000 tCO2_eq in 5 years is expected.
The company requests a contribution of €2 M (66% of investment costs) for an intervention that produces a saving of 15,000 tCO2_eq, which would correspond to an offered cost of CO2 reduction of €133/tCO2_eq
The allocation of funds will reward companies that submit a bid characterized by higher CO2 reduction cost efficiency, i.e., lower cost per reduced tCO2 (< €/tCO2) ;
The role of ESCos in the innovation fund 2025
CO2 savings at the time of application will be estimated by a qualified and independent third-party certifier (e.g., ESCo), but then it will be necessary to actually measure it with certified and sworn instrumentation, again by a third party;
Disbursement of grants will be made for the first 5 years of production in semi-annual installments based on actual thermal energy production measured and certified by the ESCo.
Why choose White Energy Group as your partner
Accessing Innovation Fund calls requires careful technical, economic and strategic planning.
The documentation to be submitted (business plan, feasibility studies, LCA analysis, CO₂ reduction plans) is complex and must meet strict European standards.
Technical and financial support Innovation Fund 2025
With the consulting support of White Energy Group, enterprises can:
White Energy supports companies in identifying solutions, technologies best suited to start a process decarbonization journey through its Orange Start consulting offerings.
As an ESCo, it can deal with
EnPC Green Heat and PPA Green Solar offer.
As an ESCo can through its Energy Performance Contract (EnPC) Green Heat offering, it can directly invest in industrial customers’ processes, directly financing the interventions and sharing the savings and CO2 emission reductions with customers.
Whitenergy complements these solutions with its Green Solar PPA offerings that provide electricity from renewable sources at prices competitive with the cost of fossil energy taken from the grid in order to make the decarbonization and electrification of its processes even more affordable.
The competitive advantage for your business
The Innovation Fund represents a unique opportunity for Italian companies that want to reduce emissions, improve efficiency and innovate their production processes.
This is not just an economic contribution, but a strategic investment in the future of European industry.
With technical support from White Energy Group, companies can access Innovation Fund 2025 grants with a targeted strategy.
Want to know if your company can access the Innovation Fund? Book a free consultation with the White Energy Group team: we will analyze your project together and guide you step by step through the application.
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