EU heat auction opens funding route for electric cement kilns

The European Commission has published the final terms for a EUR1bn auction to support the replacement of fossil-fired industrial process heat. Bidding is expected to open in early December 2026.

Cement producers can apply for projects using new electric heating equipment, including resistance and plasma technologies. The auction reserves EUR300m for heat produced above 400°C, the category most relevant to proposed electric kilns and calciners. Projects in this category must provide at least 3MW of thermal output. The stated bid ceiling is EUR800 per tonne of calculated CO₂ abatement.

Successful bidders will receive a fixed premium for independently verified heat production for up to five years. Payments will be calculated using a standard natural-gas emissions factor rather than each plant’s actual fuel emissions. Biomass- and hydrogen-fired heat projects are ineligible.

The scheme could help narrow the cost gap between electric and fossil-fired cement production. Electrifying a kiln would reduce emissions from fuel combustion, but would not eliminate the CO₂ released during limestone calcination.