Green innovation funding: the French programme of Investments for the future

Source: IEA/IRENA Renewables Policies Database
Last updated: 12 September 2019

Since 2010, the French Agency for the  Environment and Energy Management  (ADEME) has been in charge of four investment  programmes to support testing in real conditions and demonstration plants for  renewable energy and green chemistry, lowcarbon vehicle, smart grid and circular economy  projects. Totalling EUR 2.45 billion of credits,  this initiative is part of the EUR 35 billion Investments for the Future (PIA) programme.  The programme is already demonstrating  its ability to unite companies and research  partners, and to stimulate their innovationcapabilities. Compared to other existing  national research programmes, this new  programme aims at bringing innovation to the  market and focuses on specific fields set up by  strategic roadmaps.

Specific fields eligible for funding include:

(i) renewable energy and green chemistry (EUR 1.1 billion): development of new  technologies in decarbonised energy (e.g. solar,  wind), bioresources, low-carbon buildings,  energy storage and carbon capture and storage  (CCS);

(ii) smart grids (EUR 165 million): research and testing in real conditions  to enable the integration of intermittent  renewable energies into electrical grids and to  promote  "smart services € that improve energy  demand management;

(iii) circular economy (EUR 210 million): demonstration plants and  circular economy industries, including waste  management, soil and sediment remediation,  ecodesign and industrial ecology; and

(iv) lowcarbon vehicles (EUR 950 million): development  of innovative technologies and solutions  focused on land and sea transportation.

To manage these projects, ADEME developed specific financial tools, bearing in mind the  public objectives of job creation, activity  development in the French territory, economic  competitiveness and environmental benefits:  

(i) state aids complying with European Union regulations on competition. This type of  support, the most widely used, consists of  refundable grants, where the return mechanism  is correlated to the project success, and of  traditional (non-refundable) grants, mostly  dedicated to research laboratories and smalland  medium-sized enterprises (SMEs); and

(ii) equity investment tools, where the state plays  the role of market investor, one for SME projects  and one for intermediate-sized and large  enterprise projects.  The first 115 selected projects represent  investments of more than EUR 3 billion,  supported with EUR 940 million from the  programme to date. Around two-thirds of  allocated credits generate financial returns for  the state, based on a risk/gain sharing policy, a  new unique form of public-private partnerships  in France.

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