Environmental aid for industrial businesses

This page was last modified on 17-10-2012

Businesses that invest in eco-technology or environmentally-friendly processes may be eligible for specific financial aid.

Aid is granted in the form of a capital grant or interest subsidies.

Applications must be sent to the Ministry of the Economy.

Forms / Online services

Carry out your procedure:

Who is concerned

Businesses concerned

The financial aid is available to any business or natural person holding a business permit and whose primary or ancillary business involves carrying out an industrial activity in Luxembourg.

Craft and commercial businesses must send their application for environmental aid to the General Directorate for SMEs and Entrepreneurship at the Ministry of the Economy.

Businesses that are active in the primary production, transformation or sale of agricultural products cannot benefit from public financial aid unless they form a separate commercial company in order to be eligible by the Ministry of the Economy.

Eligible investments

An application guide which includes the technical fact sheets listed below is available to businesses in order to help them prepare their application.

The financial support scheme has foreseen 6 types of investment which may be eligible for financial aid:

Other technologies may be eligible provided they fall under one of the investment schemes and comply with the conditions for granting the aid.

How to proceed

Drafting the application

The application for environmental aid with regard to an investment project must be accompanied by the following documents:

  • an application letter for financial aid (please see the template in the Application guide);
  • section A of the form: general information on the applicant (headings 1-8);
  • section B of the form: information on the investment project:
    • project title;
    • name, telephone number and email of the project owner;
    • background and evolution of the project (max. 1 page);
    • provisional timetable of the works;
    • detailed description of the project in accordance with the technical fact sheet (if available), or a description of the planned technical solution with basic diagrams (max. 5 pages);
    • description of the technological potential and the innovative nature of the project, if any;
    • energy balance and environmental impact (CO2);
    • document and evaluate the incentive effect of the financial aid (only for large businesses):
      • which specific actions will be undertaken with the financial aid?
      • how and to what extent do the measures put in place contribute to a better protection of the environment or a more rational use of natural resources?
  • the business plan concerning the investment project (15 year forecast) in Excel format (.xls or .xlsx);
  • a detailed quote from the service provider selected to carry out the environmental study;
  • a copy of all the permits required (building permit, operating permit, nature protection permit);
  • balance sheet and income statement for the past 3 financial years (if the business has been in operation for less than 3 years, it must submit a detailed business plan);
  • articles of association of the company (if it is the first aid application submitted to the Ministry of the Economy, or the updated articles of association in the event of amendments);
  • the legal structure (specifying existing links, the percentages of participating interests, the company name, address, breakdown of share capital, number of employees, turnover and balance sheet total (data from the past financial year ending) of each business);
  • a summary of the financing plan;
  • any other information deemed necessary.

The documents can be submitted in French, German or English.

As far as environmental studies are concerned, the Ministry strongly recommends the use of a technical specifications sheet so that the various quotes submitted by potential providers can be compared more easily. Businesses can freely chose to attach the specifications sheet used and on which the quotes are based.

Applicants shall use an abridged application form - Aid for environmental research (in French).

Submitting the application

Applicants must submit their application for financial support concerning their investment project before the actual beginning of the project and they must follow the indications in the Application guide in force to draw up their application.

The application must be submitted:

Amount of financial aid

The amount of aid varies between 10 % to 80 % of the investments, depending on the type of project and the type of business carrying it out.

The table below summarises the maximum degree of aid that may be granted under all aid schemes, expressed as a percentage of eligible expenses. Each line represents a specific aid scheme or measure.

Degree of aid depending on the type of scheme

 

Specific conditions

Small business

Medium business

Large business

Investments enabling a business to exceed EU standards or increase the level of environmental protection despite the absence of such standards

none

55 %

45 %

35 %

Early adoption of future EU standards by small and medium-sized businesses

Investment project carried out more than 3 years before the entry into force of a standard

15 %

10 %

N/A

Investment project carried out between 1 and 3 years before the entry into force of a standard

10 %

N/A

N/A

Investments in energy saving

Method 1 'additional investment costs'

40 %

30 %

20 %

Method 2 'additional investment costs less operating profit and costs' depending on the duration taken into account with respect to operating profit and costs.

80 %

70 %

60 %

3 years

3 years

4 years

Investments in high-efficiency cogeneration

none

65 %

55 %

45 %

Investments in the production of energy from renewable energy sources

none

65 %

55 %

45 %

Environmental research

Studies directly related to investments

70 %

60 %

50 %

Accumulation rules

Aid granted under the different schemes may be accumulated with other aid compatible with the common market as long as it is granted in respect of other eligible costs.

However, this aid may not be combined with other national or EU aid covering all or part of the same eligible costs if such an accumulation will lead to an amount of aid which exceeds the maximum limits allowed.

Repayment

Businesses that were granted aid shall be obliged to repay said aid if:

  • they knowingly provide false or incomplete information, or;
  • they do not respect the conditions under which the aid was granted, or;
  • they sell the assets for which the aid was granted or stop using said assets before the end of a 5-year period starting from when the aid was first paid.

Regardless of the reason for repayment, the business must repay the capital grant or the amount of the gross interest subsidy, plus legal interest.

However, businesses may send a reasoned request to the Minister of the Economy if they wish to put forward specific circumstances justifying the non-repayment of all or part of the aid.

In the event of the voluntary cessation of activity, businesses must immediately inform the Minister of the Economy who may request partial or full repayment of the aid granted.

Who to contact

Ministry of the Economy
19-21, boulevard Royal
L-2449 - Luxembourg
Postal box L-2914
Luxembourg
Phone: (+352) 247-84185
Fax: (+352) 247-84311
Email loi.environnement@eco.etat.lu

5, avenue des Hauts-Fourneaux
L-4362 - Esch-sur-Alzette
Luxembourg
Phone: (+352) 43 62 63-1
Fax: (+352) 43 81 20
Email info@luxinnovation.lu