State Aid Measures to Support the Clean Industrial Deal: A New Framework for Europe's Green Transition

The European Commission has introduced on 26 February the Clean Industry State Aid Framework (CISAF), a comprehensive set of guidelines aimed at aligning state aid measures with the objectives of the Clean Industrial Deal. This initiative is designed to accelerate industrial decarbonisation, support clean technology manufacturing, and ensure a competitive and sustainable economy within the EU. 

Why is state aid necessary?

Achieving the ambitions of the Clean Industrial Deal requires substantial investment, primarily from private sources but complemented by public funds where necessary. The framework provides a structured approach for member states to design state aid measures that foster investments in renewable energy, industrial decarbonisation, and clean tech production while preserving competition within the internal market.

Key objectives of CISAF

  • CISAF facilitates public support for industrial decarbonisation through subsidies, tax incentives, and financial instruments to attract private capital. 
  • Incentives are targeted at renewable energy deployment, flexibility mechanisms, and clean industrial processes. 
  • The framework prevents excessive market distortion by setting clear compatibility criteria for aid measures. 
  • Competitive bidding and claw-back mechanisms ensure that financial support is limited to what is strictly necessary. 
  • Member states can introduce aid schemes for wind, solar, hydropower, and hydrogen production. 
  • Direct price support schemes, such as two-way contracts for difference, will be used to stabilise investments. 
  • Public aid can be granted to projects reducing greenhouse gas emissions, improving energy efficiency, or deploying carbon capture and storage (CCS) technologies. 
  • Investments must demonstrate a minimum 20% reduction in emissions or energy use. 
  • State aid can be used to establish new production capacity for critical clean technologies like batteries, heat pumps, electrolysers, and CCUS equipment. 

How will support be distributed?

  • Competitive bidding – Ensures fair allocation of aid and prevents overcompensation. 
  • Tax incentives – Accelerated depreciation for clean technology investments. 
  • De-risking mechanisms – Financial instruments such as guarantees and co-investment schemes to attract private investors. 
  • Strict compliance requirements – Projects must be completed within strict timeframes, and aid must not lead to unnecessary market distortions. 

A step towards a greener Europe

CISAF represents a bold step in aligning EU industrial policy with climate goals. By setting out a clear, structured, and competitive approach to state aid, the framework ensures that Europe can lead in green technologies while maintaining economic stability. Member states now have a roadmap to deploy funds effectively, ensuring a clean, competitive, and socially fair transition towards net-zero industries. 

Navigating the new funding landscape with Euro-Funding

As the European Commission prepares for the 2028–2034 financial period, businesses and organisations must adapt to a rapidly evolving funding environment. Euro-Funding, with its extensive expertise in securing EU funding, can guide companies through this complex landscape. From identifying the most suitable funding opportunities to structuring successful applications and ensuring compliance with evolving regulations, Euro-Funding provides end-to-end support to maximise access to financial aid. By leveraging deep industry knowledge and strong institutional connections, Euro-Funding helps clients position themselves strategically to benefit from the new wave of EU funding initiatives. 

Relevant figures in aid for clean industry projects

Euro-Funding has secured funding for more than 50 projects within the framework programmes of the European Union in the last three years, with a special focus on the Innovation Fund call, where Euro-Funding at least triples the chances of success. 

Furthermore, Euro-Funding clients have obtained 20% (€100 million) of the funds available for decarbonisation in Spain under the Recovery and Resilience Mechanism’s first call. 

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