A long-debated multi-billion euro fund for clean energy projects in Europe opened its first call for proposals on 9 November, with the aim of helping large industrial companies push forward commercial-scale low-carbon plants.

The fund aims to support at least eight demonstration projects to capture carbon dioxide and store it underground, and at least 34 projects involving renewable energy technologies such as solar power, bio-energy, wind, tidal and geothermal energy (full details here). They would be spread fairly evenly across European nations.

Right now, the fund is estimated at €4.5 billion. It’s not possible to say exactly how much cash is on the table, since money will be raised from the selling of 300 million carbon ‘credits’ (permits to emit carbon dioxide) under the European Union’s emissions trading scheme for greenhouse gases. The market rates of these allowances at the time of sale will determine revenues hauled in (ultimately, the credits will end up being bought by industrial plants taking part in the trading scheme).

Member states have argued for more than a year about what the funds should support. Originally, the idea was that the credits would be used only to part-finance carbon capture and storage (CCS) demonstration plants. But when the scheme was finally agreed by member states – on 2 February this year – renewable energy technologies grabbed a sizeable share of the pot. According to Euractiv, the Commission said that it has not yet decided how the money will be split between renewables and CCS; this will depend on the quality and needs of proposed projects, it said.

The first call for proposals covers 200 million credits (i.e. around €3 billion). The European Investment Bank, which is administrating the scheme, will receive proposals from member states by May 2011, while the Commission hopes to decide on worthy cases in the second half of 2012.