Green light for German State Aid scheme to boost clean technologies

On 5 February 2026, the European Commission (Commission) approved a German State Aid scheme worth three billion euros (Commission’s press release from 5 February 2026). The scheme is intended to promote strategic investments in manufacturing capacity for clean technologies (Cleantech) and thus contribute towards implementing the objectives of the European Union's Clean Industrial Deal (more on the Clean Industrial Deal in our Noerr Insight from 20 March 2025).

The approval was based on section 6.1 of the Clean Industrial Deal State Aid Framework (CISAF) introduced in mid-2025, which facilitates state support measures for industrial transformation and net-zero manufacturing (more on the CISAF in our Noerr Insight from 3 July 2025). This is one of the first comprehensive national State Aid schemes to be approved under the CISAF.

German State Aid scheme for billions in Cleantech funding

The aim of the German State Aid scheme is to expand production capacities for net-zero technologies and their main specific components. These include technologies and products necessary for climate-friendly industrial production, as well as the production and recycling of critical raw materials, insofar as these contribute to the production of these net-zero technologies. A list of net-zero technologies covered by the scheme can be found in Annex II of the CISAF. These include, for example, photovoltaic systems, heat pumps, and sustainable biogas plants. Nuclear fission energy technology is excluded from the aid scheme.

The scheme comprises various instruments, notably direct grants, tax advantages, interest subsidies for new loans and guarantees for new loans. Thus, its design generally allows for flexible adaptation to different investment and financing structures.

State Aid can be granted to companies throughout Germany. Both new investments and expansions of existing production capacities are eligible. The scheme will remain in force until 31 December 2030. It is therefore designed for a longer investment period and makes full use of the CISAF's term. This should be particularly important for capital-intensive industrial projects.

Approval under the Clean Industrial Deal State Aid Framework (CISAF)

The Commission has found that the German State Aid scheme meets the requirements of the CISAF. In the Commission's view, the scheme is necessary, appropriate, and proportionate to provide investment incentives for additional manufacturing capacity in Cleantech, and related main specific components, as well as the extraction of critical raw materials, in this way contributing to the transition to a climate-neutral economy. Certain sectors of the economy that are important for implementing the Clean Industrial Deal are supported, and any distortions of competition in the internal market are limited.

The Commission’s press release highlights that the State Aid scheme specifically targets investments that would not be made without state support, or at least not to the same extent (see investment aid schemes under Section 6.1 of the CISAF). The scheme will contribute to securing and expanding production capacity for Cleantech within the European Union. At the same time, sufficient safeguards are in place to ensure that distortions of competition are kept to a minimum. The measure is therefore compatible with the internal market within the meaning of Article 107(3)(c) of the Treaty on the Functioning of the European Union (TFEU), meaning that it is permissible under State Aid law.

The Commission approved the State Aid scheme during the preliminary examination period and thus within two months of its notification by the German government.

Promoting industrial transformation processes

With the Clean Industrial Deal, the 27 Member States of the European Union have set themselves the goal of producing 40 % of their Cleantech needs by 2030 and becoming climate neutral by 2050. Accordingly, the CISAF focuses in particular on the expansion of renewable energies, the development of manufacturing capacities for Cleantech, the increased use of low-carbon fuels, the decarbonisation of existing production facilities, and the reduction of investment risks.

The approval of the German State Aid scheme is a practical example of how the CISAF is applied to mobilise national support measures. It also shows that national State Aid schemes aligned with the objectives of the European Union’s industrial strategy can be approved quickly and with legal certainty under the new framework. In this way, the Commission is signalling increased flexibility in State Aid law for the overarching goal of industrial transformation.

This development above is relevant for all companies that are active in the production of Cleantech or want to invest in facilities used for this purpose. For companies in Germany, the approved aid scheme creates a clearer and more predictable framework for State Aid. The State Aid scheme expands the scope for state support for scaling up manufacturing capacities in emerging technologies. The clear State Aid framework improves planning certainty for investment decisions.

Now that the Commission has given its approval, Germany may implement the far-reaching State Aid scheme to promote the manufacture of Cleantech products. We will keep you informed about the launch of the support programme here. Developments to date show that companies should follow this topic closely and carefully assess the opportunities that state support can open up for their business.

Our Noerr competence team consists of experienced experts in the field of EU State Aid law and is available to answer any questions and provide support. Feel free to sign up here to receive all our news alerts on EU State Aid law and the Foreign Subsidies Regulation, or click here to access our new FSR Checker and find out whether your M&A transaction is subject to notification under the Foreign Subsidies Regulation.