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2025-09-01
The European Union will launch its first Heat Auction in 2025, a €1 billion pilot scheme to cut emissions from industrial process heat. Solar thermal stands out as the solution that delivers both immediate and long-term climate impact.
The Heat Auction is part of the EU Innovation Fund and aims to transform how industries generate heat. Industrial process heat represents almost half of total industrial energy use and is responsible for around three quarters of greenhouse gas emissions. Today, most of that heat comes from natural gas. Switching to solar thermal, geothermal and electrification can reduce emissions while keeping industries competitive.
A total of €1 billion will be available, split equally between low-temperature heat from 100–400°C and high-temperature heat above 400°C. Successful projects will receive operational support for up to five years, with payments based on verified CO₂ reductions. The auction will support projects of minimum 5 MWth, which is corresponding to about 8000 m² of solar thermal collectors with a ground footprint of e.g. 100 m x 200 m and an investment cost starting from €2,5 million Euro.
Electrification can provide short-term solutions, but its economics remain uncertain. For example, a brewery that installs an electric boiler may benefit during the five years of subsidy. But once the support ends, the cost of electricity and rising grid charges are likely to make natural gas cheaper again, forcing a return to fossil fuels.
By contrast, using the auction support to invest in solar thermal or geothermal gives decades of free renewable heat. The funding can cover most of the upfront cost, while the installation continues to deliver CO₂ reductions long after the five years of subsidy are over. District heating networks already show how robust solar thermal can be, with installations still in operation after more than 30 years.
Absolicon’s T160 solar collector, certified and deployed worldwide, is designed to deliver high-temperature solar heat for industrial processes. With the Heat Auction, industries now have a clear path to invest in solar thermal, securing long-term energy savings and sustainable production.
The final terms of the Heat Auction will be published in autumn 2025. Absolicon is ready to support partners and industries interested in making the most of this unique opportunity, ensuring solar thermal takes a central role in Europe’s industrial energy transition.
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