According to current planning, a total of around 3.3 billion euros will be available for the entire duration of the programme. The first call for funding is expected to start in September 2024. Companies will then have three months to submit their projects. Federal Minister for Economic Affairs and Climate Protection Robert Habeck: ‘Today is a good day for SMEs, for climate protection and for jobs in our country. With the new funding programme, we are supplementing the climate protection agreements and explicitly addressing SMEs. We also want to support the many small and medium-sized production companies in particular in switching to low-carbon processes.’
Follow-up programme for decarbonisation in industry
The new funding programme is to run until 2030 and there will be annual funding competitions. Funding will come from the Climate and Transformation Fund (KTF). The Federal Funding for Industry and Climate Protection (BIK) is the successor programme for decarbonisation in industry (DDI), which KEI, operating under the umbrella of Zukunft - Umwelt - Gesellschaft (ZUG), had already implemented as the project sponsor. The new funding programme is open to all sectors and technologies and enables the implementation of innovative small and medium-sized transformation projects in particular. For example, switching to electricity can make sense where fossil fuels are still being used in processes that require high temperatures.
BIK addresses the SME sector
The BIK complements the instrument of climate protection agreements and is aimed specifically at SMEs. BIK and climate protection contracts are harmonised and cannot be combined. The funding opportunities start from a project size of 500,000 euros for small and medium-sized enterprises (SMEs) and one million euros for large companies. If the project volume exceeds 15 million euros, co-financing of 30 per cent is provided by the federal states.
The BIK in detail
Two funding modules are available under the BIK:
Funding for decarbonisation projects (Module 1)
The project sponsor for Module 1 ‘Projects for the decarbonisation of industry including application-oriented research and development’ is the Competence Centre for Climate Protection in Energy-Intensive Industries (KEI). All industrial companies that plan or operate plants with industrial processes and want to save at least 40 per cent of their CO2 emissions in production through investments or research projects are eligible. The funding recipients must have a permanent establishment or branch in Germany, as the project must also be implemented in Germany. Module 1 is aimed at companies in the energy-intensive basic materials industry, such as the chemical basic materials industry, the steel and foundry industry, glass industry, ceramics industry, paper and pulp industry, cement and lime industry. However, funding is expressly not limited to these sectors. The maximum funding in Module 1 is up to 200 million euros per company. Module 1 is the continuation of the successful ‘Decarbonisation in Industry’ programme, which has funded 29 projects throughout Germany with a volume of around 578 million euros.
Funding for CCU and CCS (Module 2)
Module 2 ‘Projects for the application and implementation of CCU and CCS including application-orientated research and development’ is managed by Project Management Jülich - PtJ. In accordance with the key points of the Carbon Management Strategy, which were adopted by the Cabinet on 29 May 2024 and which define Germany's approach to the capture, storage and use of CO2 (CCU/CCS), there is a funding opportunity for CCU/CCS investment and innovation projects. Funding is limited to CO2 emissions that are difficult to avoid. In the first call for funding, investment projects in the lime, cement and thermal waste treatment sectors are eligible for funding; innovation projects can also be funded in the basic chemicals, glass and ceramics sectors.
BIK is thus making an initial contribution to implementing the key points of the Carbon Management Strategy. Investment projects are eligible for funding of up to 30 million euros; industrial research projects are eligible for funding of up to 35 million euros.
