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Innovation Fund Auction for Hydrogen Innovation Fund Auction for Hydrogen

Innovation Fund Auction

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FOR WHOM?
Companies
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FOR WHAT?
Production of Hydrogen or Decarbonisation of industrial processes
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TOTAL BUDGET?
Approximately € 1 billion annually

The Innovation Fund Auction, part of the Innovation Fund, is a groundbreaking financing mechanism launched by the European Commission to accelerate green technologies. Unlike traditional grants, the Innovation Fund Auction introduces a competitive bidding process where project developers can submit their desired price for avoiding CO₂ emissions. The most cost-efficient projects—those requiring the lowest support per tonne of CO₂ avoided—are selected for funding.

Innovation Fund Auction for Hydrogen

The first Auction was launched in 2023, and the second followed in 2024. Both Auctions were intended for the production of green hydrogen. ‘Green’ hydrogen is hydrogen produced using renewable electricity. Also known as ‘RFNBO hydrogen’.

Innovation Fund Auction Pilot Heat Auction 2025 (IF25 Auction)

In 2025, the EC is opening a new Auction for decarbonisation of industrial processes: Innovation Fund 2025 Pilot Heat Auction. It’s based on the experience of the hydrogen auctions of the Innovation Fund. A budget of € 1 billion has been allocated for this auction to support projects that decarbonise industrial process heat through innovative elektrification technologies such as heat pumps, electric boilers, esistance heating, induction heating, plasma heating and other solutions, as well as renewable heat solutions (solar thermal and geothermal). Companies in various sector are eligible, not only larger companies but also smaller companies and mid-caps.

What is the Innovation Fund Auction?

Unlike traditional grants, the Innovation Fund Auction introduces a competitive bidding process where project developers can submit their desired price for avoiding CO₂ emissions. The most cost-efficient projects—those requiring the lowest support per tonne of CO₂ avoided—are selected for funding.

This reverse auction model increases transparency, promotes market-driven innovation, and ensures the most impactful climate solutions receive support.

Why Participate?

  • Substantial Funding: Benefit from non-dilutive support to scale up your technology.
  • Market Visibility: Position your project among Europe’s leading innovators.
  • Credibility: Winning the auction showcases your solution’s cost-efficiency and impact.

Key dates and deadlines

The first Innovation Fund Auction launched in November 2023, with a €800 million budget focused on hydrogen production. The second Auction was open for biddings in December 2024 with a total budget of €1.2 billion. The dates of the Auctions in 2025 are not yet published. Keep an eye on our website or contact us to make sure that you won’t miss it.

How to Prepare?

To increase your chances of success:

  • Quantify your CO₂ avoidance per euro requested.
  • Build a solid business case and technical proposal.
  • Monitor calls on our website or subscribe for our newsletter.

Need Help with Your Application?

Navigating the Innovation Fund Auction can be complex. Our specialists can help you:

  • Assess project eligibility
  • Prepare competitive bids
  • Maximize your chances of funding

Contact us today to turn your innovation into a funded climate solution. Our specialists will be happy to check it out with you! Contact us to schedule a meeting and discuss your options.

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Frequently asked questions about the Innovation Fund Auction

We receive many questions about the Innovation Fund Auction. We have summarised a number of them for you.
  • What is the Innovation Fund Auction?

    The Innovation Fund Auction is a competitive funding mechanism launched by the European Union to support innovative low-carbon technologies. Instead of awarding grants through traditional calls, funding is allocated via an auction process to ensure cost-effectiveness and transparency.

  • Who can apply?

    Eligible applicants include companies, project developers, and consortia based in the EU, Iceland, or Norway that are developing large-scale or small-scale projects in renewable energy, energy storage, carbon capture and storage (CCS), carbon capture and utilisation (CCU), and low-carbon manufacturing.

  • How does the IF Auction work?

    Applicants submit bids indicating the level of support they require to implement their project. The projects requesting the lowest level of support per tonne of CO₂ avoided are awarded funding first, until the available budget is exhausted.

  • Projects must contribute to significant greenhouse gas (GHG) emission reductions and demonstrate innovative technologies that can be scaled across Europe. Supported areas include:

    • Renewable energy generation
    • Industrial decarbonisation
    • Energy storage solutions
    • Carbon capture, utilisation and storage (CCUS)
  • How is funding provided?

    Successful bidders receive a fixed premium or strike price, depending on the auction design, to cover the gap between the project’s cost and the market price. This ensures that innovative projects become commercially viable while minimising the need for long-term subsidies.

  • What are the benefits of participating?
    • Access to substantial EU funding
    • Increased investment certainty for first-of-a-kind technologies
    • Enhanced visibility and credibility for innovative projects
    • Contribution to the EU’s climate neutrality goals
  • How often are IF Auctions held?

    One IF Auction opens every year. Topics, timelines and budgets are announced in advance.

  • What is the difference between the Innovation Fund Auction and regular Innovation Fund calls?

    While regular calls provide grants based on project proposals and evaluations, the auction system is purely competitive and price-based. It rewards projects that can deliver the highest impact at the lowest cost.

  • How can I prepare for an auction?
    • Assess the financial viability of your project
    • Calculate the minimum funding you need to proceed
    • Ensure your project complies with eligibility and innovation criteria
    • Gather documentation on expected CO₂ reductions and technological readiness
    • Increase your chance of success by hiring a grant consultancy firm like FirstBlue to determine the best strategy

Support in Innovation Fund Auction

Are you looking for a reliable partner to support you in bidding for the Innovation Fund Auction? FirstBlue has extensive experience! Our specialists would be pleased to support your project. Please do not hesitate to contact us via info@firstblue.com or fill in the form:

Contact

FirstBlue Grant Consultancy
We provide optimal grant support. Specialised in EU grant and funding programmes. You can find us in Amsterdam, Brussels, Düsseldorf, Eindhoven, The Hague, Hoevelaken and Nijmegen

E-mail: info@firstblue.com
Phone: +31 (0) 88 495 20 00 (NL)

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