The European Commission has announced a €4.6 billion ($4.8 billion) funding initiative to drive climate innovation and advance Europe's transition toward net-zero emissions.

Approximately €3.4 billion of the funding will support the adoption of decarbonization technologies, including electric vehicle (EV) battery manufacturing, a crucial step in the EU's drive for sustainable transportation. The remaining €1.2 billion will be directed toward the production of renewable hydrogen, seen as a key energy source for a green economy.

"This demonstrates the commission's commitment to achieving its decarbonization objectives while enhancing the competitiveness of European industries in strategic sectors," said European Commission Vice President Teresa Ribera Rodriguez.

The funding, sourced from the EU Emissions Trading Systems (EU ETS), is part of the bloc's broader efforts to reach climate neutrality by 2050. The EU ETS, the world's largest carbon pricing system, is expected to generate €40 billion in revenues between 2020 and 2030.

The allocated funds will be distributed through a series of calls for proposals open until April 2025, aiming to foster innovative solutions across the region.