European commission approves €5 Billion initiative to help German businesses decarbonize

By Abdullahi Lukman

The European Commission has approved a €5 billion ($5.4 billion) initiative to help German businesses decarbonize their industrial production processes, marking a significant step in achieving the EU’s climate neutrality target by 2050.

The announcement was made on March 24, 2025, by Teresa Ribera, the Commission’s Vice President for clear, just, and competitive transition.

Ribera emphasized that the funding would assist businesses in sectors like chemistry, construction, and food, all of which are subject to the EU Emissions Trading System.

The initiative is designed to support projects that significantly reduce greenhouse gas emissions through technologies like electrification, hydrogen use, carbon capture, and improvements in energy efficiency.

“This initiative will contribute to the EU’s climate neutrality goal while minimizing potential competition distortions,” said Ribera.

The scheme aims to help businesses lower their carbon footprints and transition to more sustainable industrial practices.

To qualify for the funding, projects must meet stringent emission reduction targets.

Companies will need to achieve a 60% reduction in emissions within three years, with the goal of reaching a 90% reduction by the conclusion of the project.

The approval of this funding underscores the European Union’s commitment to supporting the green transition while ensuring fair competition across the bloc’s industries.