Investment aid for large clean transition investments

The aid is granted by Business Finland. The aid application must be submitted to Business Finland before the work for the investment project begins.

A tax credit for large clean transition investments is also being prepared as a parallel form of support.

When to apply for funding

General conditions for granting investment aid

The aid may be granted to an investment project carried out in Finland, with the exception of the territory of the Åland Islands, if an overall assessment indicates that the effects of the project are significant for Finland’s climate and economic policy objectives. The aid may be granted if the acceptable, i.e. eligible, costs of the investment are at least EUR 30 million.

The aid cannot be granted to a company in difficulty. For example, a limited liability company over three years old that has lost more than half of its subscribed share capital due to accumulated losses is a company in difficulty.

The aid cannot be granted to a company that is subject to sanctions imposed by the European Union.

What is required of your company?

The company is not in difficulty.

The aid cannot be awarded to a company which is subject to an outstanding recovery order following a previous Commission decision declaring an aid illegal and incompatible with the internal market.

The company is not entitled to an investment credit if the company or group to which it belongs is a credit institution or other financial institution.

Funding cannot be granted if:

• The company is not included in the prepayment register.
• The company has tax debt for which there is no valid payment plan.
• The company has significant payment defaults.
• The company has debt in enforcement for which there is no valid payment plan.
• The company has outstanding obligations on previous Tekes/Business Finland loans.
• The company does not meet the requirements for ongoing profitable business.

What can the funding be used for?

Aid for the decarbonisation and energy efficiency measures of industrial production processes

Aid may be granted to an investment that enables at least one of the following:

• Direct greenhouse gas emissions from the beneficiary’s industrial installation using fossil fuels as an energy source or raw material decrease by at least 40 per cent compared to the situation prior to the grant by electrifying production processes or by switching to renewable hydrogen or fuels produced from renewable hydrogen instead of fossil fuels;
• The energy consumption of the beneficiary's industrial installation decreases for the supported activity by at least 20 per cent compared to the situation prior to the aid.

If the grant is awarded for an industrial decarbonisation investment involving the use of renewable hydrogen, the hydrogen used shall be produced in accordance with the methods for renewable liquid and gaseous transport fuels of non-biological origin laid down in Directive (EU) 2018/2001 of the European Parliament and of the Council on the promotion of the use of energy from renewable sources and in its implementing acts or delegated acts.

If the grant is awarded for an industrial decarbonisation investment involving the use of fuels produced from renewable hydrogen, the fuels used shall meet the following requirements:

• They are liquid and gaseous fuels produced from renewable hydrogen whose energy content comes from renewable sources other than biomass.
• They achieve lifecycle GHG emission reductions of at least 70 per cent compared to the fossil reference point 94 g CO2eq/MJ.
• They have been produced in accordance with the methods for renewable liquid and gaseous transport fuels of non-biological origin laid down in Directive (EU) 2018/2001 of the European Parliament and of the Council on the promotion of the use of energy from renewable sources and its implementing acts or delegated acts.

Eligible costs

The costs of electrification and switching to renewable hydrogen or fuels produced from renewable hydrogen, and the costs of equipment, machinery and installations necessary for the improvement of energy efficiency, and other investment costs related to the investment project are eligible for aid. Eligible costs as well as terms and conditions for intra-group purchases and purchases from affiliated companies are described in more detail in section 10 of the funding terms and conditions.

Ineligible costs include

• Wages and salaries
• Overheads
• Representation expenses
• Interest and other financing costs
• Fees based on the Act on criteria for charges Payable to the State
• Cost reserves
• Travel expenses paid or reimbursed by the beneficiary
• VAT paid by the beneficiary as part of the acquisition price of goods or services.

Maximum aid and granting conditions

Based on project-specific decisions, aid may be granted for up to:

• 50% of the eligible costs of the investments that reduce greenhouse gas emissions, other than those related to electrification;
• 30% of the eligible costs of investments related to electrification that reduce greenhouse gas emissions
• 30% of the eligible costs of investments to reduce energy consumption.

The grant may not exceed EUR 200 million for the undertaking. If the investment has also been granted a tax credit (investment credit), the total amount of the aid and the tax credit cannot exceed EUR 200 million. Aid may be granted to an investment project for which other State aid has been granted based on the same eligible costs, as long as such cumulation of state aid does not result in exceeding the maximum amount of aid allowed under any applicable provision.

Aid must not be allocated to increasing the beneficiary’s total production capacity. However, this does not include a capacity increase necessary for technical reasons of up to 2% compared to the situation before the granting of aid.

The aid must encourage the beneficiary to make an investment which it would not carry out at all or which it would carry out in a restricted or different way without the aid. The application must be accompanied by a calculation describing the profitability of the investment without the aid and in a situation where the aid would be granted.

Aid cannot be granted solely for meeting the applicable European Union standards.

The installation or equipment funded with the aid must be ready and operational within 36 months of the date when the aid is granted. If this 36-month time limit is not met, the amount of the granted aid will be reduced, at the time of payment, by 1% for each full month exceeding the 36-month time limit, up to the total amount of the aid. However, the amount of the aid will not be reduced if the delay is due to an unexpected reason beyond the beneficiary’s control.

An overall assessment of the effectiveness of investment projects will be made on the basis of the following criteria:

• Project feasibility, covering the technical and economic feasibility of the project, the availability of resources and the required technology
• At least one of the following: the reduction of greenhouse gas emissions and energy consumption resulting from the investment project
• The project’s cost-efficiency as assessed by the amount of aid for at least one of the following: the project’s estimated total emission reduction (CO2) and total reduction of the final energy consumption (GJ) over the investment’s estimated life cycle
• Other impacts, such as other environmental impacts, impacts on employment and the regional economy, impacts on the potential for industrial-scale introduction of innovative technologies developed in Europe, as well as any other significant impacts.

Aid payment

The amount of the last aid installment must be at least 20% of the total aid granted.

The aided investment must be fully implemented before the payment of the last aid instalment. The payment of the last installment is subject to the approval of the project’s final report on the results and utilization potential of the project and on the use of the funds.

Aid for investments in sectors strategic to the transition to a climate-neutral economy

Aid may be granted for investments in sectors that are strategic for the transition to a climate-neutral economy. This refers to the production of relevant equipment for the transition to a climate neutral economy, the production of key components designed and primarily used as direct input for the production of the equipment, as well as the production or recovery of related critical raw materials necessary for the production of the equipment and components.

Relevant equipment for the transition to a climate neutral economy means

• Batteries
• Solar panels
• Wind turbines
• Heat pumps
• Electrolysers
• Equipment for carbon capture, usage and storage.

Eligible costs

The costs eligible for aid are the costs of tangible assets, such as land, buildings, factories, equipment and machinery needed for the production or recovery of commodities. Reasonable costs of an investment project on intangible assets such as patent rights, licenses, know-how or other intellectual property are also eligible for aid.

An intangible asset that qualifies as an eligible cost must meet the following conditions:

• It must remain connected to the area in question and must not be moved to another area
• It must be used primarily in the production installation receiving the aid
• It must be depreciable
• It must be purchased on market terms from third parties independent of the company receiving the aid
• It must be included in the assets of the company receiving the aid
• It must remain connected to the project receiving the aid for at least five years.

The following costs are ineligible:

• Wages and salaries
• Overhead
• Representation expenses
• Interest and other financing costs
• Fees based on the Act on criteria for charges payable to the State
• Cost reserves
• Travel expenses costs paid or reimbursed by the beneficiary
• VAT paid by the beneficiary as part of the acquisition price of goods or services.

The eligible costs as well as the terms and conditions of intra-group purchases and purchases from affiliated companies are described in more detail in section 10 of the funding terms and conditions.

Maximum aid and granting conditions

Aid can be granted for up to 15% of the eligible costs and up to EUR 150 million per company. However, for investments in assisted areas in Finland designated in the applicable regional aid map of the European Union, the aid could be granted at an increased rate of up to 20% of the eligible costs and up to EUR 200 million. If the investment has also been granted a tax credit, the total amount of the aid and the tax credit must not exceed EUR 150 million, or EUR 200 million in the assisted areas designated on the regional aid map. (See Government Decree on the assisted areas referred to in the Act on the Development of Regions and the Implementation of the Regional and Structural Policies of the European Union in 2022–2027 (467/2022) and https://tem.fi/en/support-areas).

In addition, the cumulation rules for state aid should be complied with when granting aid. The total amount of state aid must under no circumstances exceed 100% of the eligible costs.

The beneficiary must undertake to keep the aided investment in its area of operation for at least five years after the completion of the investment. However, this does not prevent the replacement of a production installation or equipment that has become obsolete or broken during this period, provided that economic activity will be continued in the area in question for the minimum period. However, no additional aid will be granted for the replacement of a production installation or equipment.

The aid must not facilitate the relocation of production activities between Member States of the European Economic Area. To this end, the beneficiary must declare that it has not relocated its activities to the location where it intends to carry out the investment for which the aid is granted in the two years preceding the aid application. The beneficiary must also undertake not to relocate activities this way for a period of two years from the completion date of the investment.

Aid payment

The aid is paid retrospectively upon application on the basis of actual, paid and eligible costs.

Before you apply

Before applying for funding, carefully read the funding terms and conditions and the relevant Government Decree.

Apply for funding

The application for aid must be submitted to Business Finland before the start of works of the investment project.

The start of works means either the start of construction works relating to the investment or the first legally binding commitment to order equipment or any other commitment that makes the investment irreversible, whichever is earlier. Buying land and preparatory works such as obtaining permits and conducting preliminary feasibility studies are not considered as start of works.

The applicant must fill out the form "Investment aid for large clean transition investments" in Business Finland’s online service and attach the documents specified on the form to their application. The aid application period ends on March 14, 2025.

The aid decision will be made by Business Finland after consulting the Ministry of Employment and the Economy. In its decision, Business Finland may set more specific conditions and restrictions for the use and payment of the aid. The decision will be made no later than December 31, 2025.

Further information

Business Finland contacts

Sini Uuttu and Hanna Rinta-Erkkilä

Email addresses are in the format firstname.lastname (at) businessfinland.fi