Luxembourg’s government plans to coax companies with more than €400 million in subsidies and other financial incentives to shift away from polluting hydrocarbons to more electricity and even a future supply of hydrogen power, officials said Tuesday.
“The achievement of our climate objectives is closely linked to the ecological and energy transition of Luxembourg companies,” Economy Minister Lex Delles said in outlining changes to existing energy incentives being introduced in the Chamber of Deputies.
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The package will focus on building up and delivering a future flow of green-friendly hydrogen networks, as well as distributed heating and cooling systems, the government said. Most of the new aid will be granted after government calls for company projects that fit decarbonisation priorities and technologies and whose precise purpose and budget are defined in advance by the Economy Ministry.
The plan’s estimated budget is €412.4 million for the period 2024 to 2028, a ministry spokesperson told the Luxembourg Times on Tuesday.
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Financial subsidies for homes switching to green energy systems are to be extended for a further two years, but subsidies for installing solar panels will be cut, the government said Friday. Spending on subsidies for electric personal cars will be cut from €80 million to €45 million, the government said..
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Companies that invest in producing, consuming or transporting fossil fuels will be excluded from the incentive schemes, except in special cases, the ministry said in a statement sketching out its plan.
The incentives reform will be coupled to an effort to cut red tape, the ministry said. Applications for government funding for less than €100,000 will be processed more quickly, and incorporate the principle that official silence on whether a claim is approved will default as a de facto approval, the ministry said.
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Priorities to prod companies to launch their green transition include buying zero-emission road vehicles or converting trucks to run on electricity or hydrogen, electrifying a production line, shifting to renewable energy sources including hydrogen, and building out energy infrastructure like a future hydrogen delivery network.
