EU ETS Investment Booster: €30bn Funding Explained

The European Commission is developing the EU ETS Investment Booster, a proposed €30 billion funding instrument designed to accelerate investment in industrial decarbonisation across Europe. 

As the first phase of the planned Industrial Decarbonisation Bank, the Investment Booster aims to help mature industrial projects overcome financial barriers and move towards implementation. 

Although the scheme is still under development, its proposed approach already highlights two important factors for potential applicants: credible greenhouse gas (GHG) emissions avoidance calculations and strong investment readiness.

What is the EU ETS Investment Booster? 

The EU ETS Investment Booster is a proposed European funding mechanism intended to accelerate the deployment of mature industrial decarbonisation technologies. 

Unlike the Innovation Fund’s traditional focus on innovative and first-of-a-kind technologies, the Investment Booster would target projects using more mature solutions that are approaching an investment decision. 

The European Commission’s current proposal outlines: 

• Indicative funding: €30 billion, financed through 400 million EU Emissions Trading System (EU ETS) allowances. 

• Objective: Accelerate investment in industrial decarbonisation projects. 

• Funding approach: Fixed carbon premia linked to verified GHG emissions avoidance. 

• Allocation mechanism: A proposed first-in, first-served system for eligible projects. 

• Indicative timeline: The legislative proposal envisages an Investment Booster phase during 2028–2031, subject to approval and implementation. 

The instrument is not yet open for applications, and its final eligibility criteria and operational requirements remain to be established.

How could Investment Booster funding work? 

The proposed Investment Booster would introduce a funding mechanism based on a fixed carbon premium per tonne of CO₂ emissions avoided. 

Under the model being considered, projects could receive support linked to their independently verified emissions reductions. Different decarbonisation pathways may have different premium levels, with payments made in EU ETS allowances. 

The Commission is also considering a first-in, first-served allocation mechanism through a dedicated registry, alongside requirements related to project maturity, implementation milestones and emissions monitoring. 

This approach could make early preparation particularly important for companies developing industrial decarbonisation investments.

Which industrial decarbonisation projects could be eligible? 

The Investment Booster is expected to focus on mature technologies that can deliver measurable emissions reductions at industrial scale. Potential decarbonisation pathways under consideration include: 

• Industrial electrification: Replacing fossil fuel-based industrial processes with electricity-based alternatives. 

• Hydrogen technologies: Using renewable or low-carbon hydrogen and hydrogen-derived solutions for industrial decarbonisation. 

• Carbon capture and storage (CCS): Capturing industrial CO₂ emissions and storing them permanently. 

• Circular solutions and alternative materials: Potential pathways that could reduce emissions through resource efficiency or material substitution. 

The final list of eligible technologies and project requirements has not yet been confirmed.

How can companies prepare for the Investment Booster? 

Although the funding scheme is still being designed, companies considering industrial decarbonisation investments can already begin assessing their technical and financial readiness. Five areas deserve particular attention: 

1. Assess project eligibility and technology maturity 

Identify which proposed decarbonisation pathway best fits the project and evaluate whether the technology and implementation timeline align with the instrument’s expected objectives. 

2. Develop credible GHG avoidance calculations 

Define the project boundaries, establish an emissions baseline and estimate the potential GHG emissions avoided. Reliable calculations will be important in assessing a project’s potential under a performance-based funding mechanism. 

3. Evaluate financial viability and funding gaps 

Review capital expenditure, operating costs, financing requirements and the potential funding gap. Understanding project bankability will be essential to developing a robust investment case. 

4. Identify implementation risks and dependencies 

Assess permits, infrastructure requirements, grid connections, hydrogen or CO₂ infrastructure, offtake arrangements and other factors that could affect implementation. 

5. Understand the proposed funding mechanism 

Evaluate how receiving support through EU ETS allowances, rather than a conventional grant payment, could influence project cash flow and financing arrangements. 

Preparing these elements early can help companies identify potential weaknesses in their investment plans while the instrument continues to develop.

How can PNO Innovation support Investment Booster projects? 

At PNO Innovation, we combine expertise in EU funding, GHG emissions calculations and financial advisory to support industrial companies developing decarbonisation investments. 

Our teams can help companies with: 

• Initial eligibility assessments and decarbonisation pathway screening. 

• GHG emissions avoidance calculations and baseline definition. 

• Project maturity assessments and implementation readiness. 

• Financial modelling, funding-gap analysis and investment readiness. 

• Funding strategy and preparation for future application requirements. 

Our experience with Innovation Fund projects and industrial decarbonisation provides a strong foundation for helping companies understand the emerging Investment Booster and assess its potential relevance to their investments.

Preparing an industrial decarbonisation project? 

The Investment Booster could create new funding opportunities for mature industrial projects, but technical credibility and financial readiness will be important considerations. 

Contact our experts→

Explore how PNO Innovation can help you assess your project’s funding potential and prepare for future opportunities. 

The information in this article reflects the European Commission’s proposal as of October 2026. The Investment Booster remains under development, and its final requirements may change. 

Further information: European Commission — Investment Booster discussion paper