Draft Commission Decision Establishing the Battery Booster Facility

10 March 2026

INTRODUCTION

Establishes the Battery Booster Facility as a 2026 financial instrument under the Innovation Fund to support electric vehicle (EV) battery cell production in the ramp-up phase.

Budget:

• EUR 1.5 billion (2026).
• Financed through ETS auction revenues allocated to the Innovation Fund.

Objective:

• De-risk and accelerate first full commercial-scale EV battery cell production facilities in the EEA during
  their ramp-up phase.
• Strengthen EU industrial resilience and supply chain autonomy.

FORM OF SUPPORT

Provided as interest-free loans.
Can be combined with other EU or national support, provided total public support does not exceed eligible costs.

Maximum support:

• Up to 60% of eligible costs.
• Capped at EUR 500 million per recipient.

Loan conditions:

• Maximum tenor of 8 years.
• Repayment begins at ramp-up completion or 36 months after signature (whichever comes first).
• Equal annual repayments over 5 years.
• Subordinated to senior lenders.
• 10% penalty if production relocates outside the EEA within 12 months of cessation.
• Disbursement based on agreed milestones.

ELIGIBLE PROJECTS & ENTITIES

Applicants must be established in the EEA.

Production site must:

• Be located in the EEA.
• Have at least 10 GWh nameplate capacity.
• Be in ramp-up phase at the time of call opening.
• Represent the first global full commercial-scale EV battery cell production of the applicant (and related entities).

Ramp-up phase defined as the transition from production part approval to:

• 90% nameplate capacity,
• Stable operations,
• Sufficient yield,
• Compliance with off-take requirements.

ELIGIBLE COSTS

Limited strictly to costs incurred:

• During the ramp-up phase.
• From call opening to 36 months after loan signature.

May include:

• Personnel.
• Materials, energy, supplies.
• Contracted works.
• Capital expenditure at the production site.

Excludes:

• Repayment of other loans.
• Dividends, bonuses, share buybacks, or similar financial distributions.

SELECTION & AWARD PROCESS

Open call for proposals managed by the Commission.

Applicants must demonstrate:

• Suboptimal investment situation.
• Economic viability.
• Operational capacity.
• That private financing exceeds the Union contribution.
• No crowding-out of other funding sources.

Award criteria (simplified compared to Innovation Fund criteria):

• Financial maturity and repayment capacity.
• Technical maturity and credible implementation plan.
• Contribution to European industrial resilience, including:
  • Supply chain security.
  • Critical raw materials considerations.
  • IP and innovation ecosystem engagement.
  • Skilled workforce development.
  • Support to downstream sectors (e.g. automotive).

Proposals ranked and funded within available budget.

GOVERNANCE & SAFEGUARDS

Loan agreements define:

• Reporting, audit and anti-fraud provisions.
• Protection of the Union’s financial interests.
• Visibility obligations for EU funding.

The Commission monitors implementation and reports annually to Member States through the Innovation Fund reporting framework.
Loan repayments accrue exclusively to the Innovation Fund.