In September 2018, the German Federal Cabinet adopted the 7th Energy Research Programme. The programme contains the guidelines for energy research funding over the coming years. In order to reach the energy and climate policy goals, it is necessary to strive for a more efficient use of energy as well as to increase the share of renewable energy in all consumption sectors. Energy research plays a crucial part here as it drives the development of new and better climate-friendly generations of technology. Research and research funding are thus laying the foundation for the carbon-neutral energy system of the future. The know-how that is being developed not only drives the energy transition, but also strengthens the leading position of German companies in the field of modern energy technologies and safeguards value creation, jobs and prosperity in Germany.

Applied energy research: Paving the way for climate neutrality

Economy and society depend on having a reliable and affordable energy supply. On the one hand, this means that technically and economically viable sources of energy must be continuously available. On the other hand, given increased feed-in fluctuations of renewables and growing digital networking, ensuring the technical robustness and resilience of the energy supply system is a strategically important task that is also relevant in economic, societal and security policy terms.

Energy research policy focuses on the parameters that are crucial for meeting current and future demands in this field. One important goal is to make the energy system climate-neutral. This goal can only be met if the share of renewable energy sources is continuously increased in the following areas: wind energy and photovoltaics in electricity generation; biomass, geothermal and solar energy in heat supply, and electric mobility and synthetic fuels in the transport sector.

For renewables to be integrated into existing systems in an optimal and resource-efficient manner, an overarching approach is required that embraces different elements collectively. Essential topics in this regard are, for example, power grids, digitisation, hydrogen technologies and sector coupling. The latter links the areas of electricity, heat, mobility and industry. For example, electricity from renewable power plants can be used to produce hydrogen via electrolysis. The gas can in turn be used to decarbonise industrial processes. However, not only a higher share of renewables can reduce carbon emissions in the long term, but also lower energy demand. In further developing and optimising technologies, applied energy research helps to improve the energy efficiency of infrastructures, buildings, residential areas and industrial production processes.

In order for these innovative approaches to be successful, it is crucial that all parts of society are involved since the transformation of the energy system affects on all aspects of our lives and the way we work. Whether it be citizens, public institutions, municipalities, energy suppliers or the skilled trades: we all need to support or even actively shape the energy transition in order to effect change. Researchers are developing solutions to ensure that all of the various groups in society are involved and their needs are addressed.

Making innovative technologies ready for the market

The core objective of the research funding provided by the Federal Ministry for Economic Affairs and Climate Action is to develop innovative, holistic solutions to the challenges of the energy transition and to bring them quickly to market. This is to be supported by a broad funding approach along the entire value chain and by focusing on the transfer of research findings into practice. Research funding in the energy sector is crucial for modernising the German and European economies and for maintaining Germany’s industrial competitiveness. The aim here is to reap the benefits of digitisation, to maintain and expand technological skills in the energy sector, and to improve export opportunities for innovative energy technologies. Based on its technology-neutral approach, applied energy research contributes to developing a wide range of market solutions for the transformation process in the energy sector and thus towards achieving the climate targets.

In September 2018, the Federal Cabinet adopted the 7th Energy Research Programme entitled ‘Innovations for the Energy Transition’. The programme defines the current principles and priorities for Federal Government funding for innovative energy technology. The Federal Government provides around €1.3 billion annually under the 7th Energy Research Programme for the research, development, demonstration and testing of forward-looking technologies and concepts. The programme, which the Federal Ministry for Economic Affairs and Climate Action is managing, is implemented together with the Federal Ministry of Education and Research (BMBF) and the Federal Ministry of Food and Agriculture (BMEL). Thematic priorities and focus areas are set on the basis of the following strategy lines:

• A focus on the transfer of technology and innovation, in particular through the Living Labs for the Energy Transition as a new funding pillar for preparing innovative solutions for the market on an industrial scale. At the same time, more funding shall be made available to startups, which are considered essential for providing fresh impetus for the energy transition. The Energy Research Networks and research communication are also important elements for the transfer of knowledge within industry and the energy sector.
• An increased focus on cross-sectoral and cross-system issues of the energy transition such as digitisation, sector coupling and socioeconomic research with a view towards ensuring a holistic funding approach.
• Close networking of research on European and international level. Cooperation with international organisations will be continuously expanded and scientific exchange will be promoted. In addition, export capacity and competitiveness are to be strengthened.
• For the first time, the Energy Research Programme has an interministerial, topic-focused structure for project funding. The well-proven division of labour between the ministries will be maintained and is in line with the concept of the technology readiness level (TRL) of the topics and technologies being researched.

A consultation process for the 7th Energy Research Programme started in December 2016 and involved a broad range of stakeholders from industry, science and academia, civil society and the federal states. The strategic flagship project ‘Trends and prospects in energy research’ funded by the Federal Ministry for Economic Affairs and Climate Action provided academic support for the consultation process. In February 2018, the outcome of the report was made available to the public before the final report entitled ‘Technologies for the Energy Transition’ was handed over to Mr Thomas Bareiß, former Parliamentary State Secretary at the Federal Ministry for Economic Affairs and Energy, on 25 July 2018.

The Federal Government also provides funding for the research and development of forward-looking energy technologies in areas outside its Energy Research Programme. This involves programmes in areas where energy policy aspects are not the main focus, such as aviation research and the promotion of technology for small and medium-sized businesses.

From basic research to market maturity

The Technology Readiness Level (TRL) places the scientific and technical status of a technology on a scale from 1 to 9. Projects that aim to achieve TRL 1 to 3 and are thus classified as application-oriented basic research are funded by the Federal Ministry of Education and Research. The Federal Ministry for Economic Affairs and Climate Action is responsible for the more application-oriented research work at TRL 3 and above. The Federal Ministry of Food and Agriculture funds applied research work at TRL 3 and above on the energy use of biomass. The instrument of living labs, which serves to promote close-to-market developments, is based on TRL 7-9.
In addition, the Federal Government’s 7th Energy Research Programme addresses overarching and systemic research topics, for example through interministerial and cross-cutting research initiatives.

Innovation to strengthen Germany as a place for business and investment

The Federal Government’s 7th Energy Research Programme supports German companies in further developing their competitive edge on modern energy technologies. Climate change mitigation and carbon emissions do not stop at national borders. New energy technologies are used not only in Germany, but also worldwide. Companies that can offer innovative and cost-effective solutions in this area have a competitive advantage on international markets. In this regard, German companies and research institutions are very well positioned, not least due to the continuous research funding being provided for many energy technologies. This will help to boost growth and employment in Germany. At the same time, Germany is making an important contribution to international climate change mitigation.

Research projects are limited in time and their content is clearly defined. The projects are carried out in companies, research institutions and universities. Due to their limited length, it is possible to adapt the focus of the projects any time new developments occur. The transfer of research findings into marketable applications is also vital for the success of energy research and the application-oriented project funding provided by the Federal Ministry for Economic Affairs and Climate Action.

Funding advice

The Federal Government's 'Research and Innovation' adivsory service acts as a first point of contact for all matters related to the funding of research and innovation. This instrument serves to inform potential applicants about current funding programmes and initiatives, and about relevant contact persons. It further includes a support service for companies to guide them through the system tailored particularly to the needs of small and medium-sized companies.

Information on how to apply for funding under the 7th Energy Research Programme can be found at www.energieforschung.de

The Federal Government’s 7th Energy Research Programme establishes the market-oriented format Living Labs for the Energy Transition as a new pillar of research funding. The Living Labs for the Energy transition play a pioneering role for the transformation of the energy system and focus on research issues that are essential for the implementation of the energy transition. The living labs make it possible for consortia from industry and science to test technical as well as non-technical innovations on an industrial scale under real-life conditions. In this way, the Living Labs for the Energy Transition help innovative developments in the energy sector to become established on the market more quickly. They foster close cooperation between partners from business and industry, researchers and local stakeholders, enabling them to identify energy technologies and concepts that effectively contribute to climate change mitigation and to tailor them to actual needs.

The new funding pillar of energy research started with a competition for ideas

In February 2019, the German Federal Minister for Economic Affairs and Energy, Peter Altmaier, launched a Competition for ideas for the Living Labs for the Energy Transition. The key topics of the first round of calls for proposals were innovations in the fields of sector coupling and hydrogen technologies, energy-optimised neighbourhoods and large-scale energy storage in the electricity sector. Around 90 consortia with over 500 partners from companies, research institutions and municipalities participated in the competition. The winning teams from all over Germany have since launched ten Living Labs for the Energy Transition and further living labs are currently being planned.

The Living Labs for the Energy Transition include individual neighbourhoods or industrial sites, entire cities, or are located in various federal states. Some of the selected projects are located in regions undergoing structural conversion that are affected by the phase-out of coal. In these regions, the Living Labs for the Energy Transition can help establish new technologies and new avenues for value creation. In this context, the following issues will be addressed: How can green hydrogen be used economically on an industrial scale? How can the energy system of a city or even different cities be linked in an optimal manner? What is needed to ensure that the coupling of the electricity, transport, heat and industrial sectors is successful?

Funding instrument to be put on a permanent footing

Since the introduction of the Living Labs for the Energy Transition as a new funding instrument, and building on the experience gained from the first phase of its implementation, the Federal Ministry for Economic Affairs and Climate Action has continued to develop the Living Labs’ underlying funding strategy in a targeted manner. On 1 July 2021, a revised strategy was published by the ministry, establishing the forward-looking funding instrument, which now addresses all areas of applied research, as a permanent element in its research funding. The funding strategy is aimed in particular at the energy industry, energy-intensive industries and the housing sector. The focus is on promoting consortia led by a partner from industry or the energy sector. This clearly shows the strong practical relevance of the strategy. The key objective is for the projects to boost progress in the energy transition and towards climate neutrality. They need to prove that they can make a direct contribution to reducing carbon emissions. The Federal Ministry for Economic Affairs and Climate Action plans to support the Living Labs for the Energy Transition by providing up to €15 million per partner, i.e.€25 million in total funding.

In April 2021, the Federal Ministry for Economic Affairs and Climate Action initiated a research project focussing on the transfer of the results of the Living Labs dealing with hydrogen. The objective of the Trans4ReaL project, led by FfE Munich, is to transfer the results and findings of the Living Labs for the Energy Transition into knowledge that can be applied more broadly and thus make them accessible to a wider group. The approaches used in the Living Labs for the Energy Transition initiative are reviewed and learning experiences and options for action are derived from this. To conduct this work, Trans4ReaL relies on a trusting and intensive exchange with the funded projects. It also strives to network the Living Labs for the Energy Transition with one another in order to generate mutual learning effects. In this way, the scientists involved in the Trans4Real project will present a pathway for how a sustainable hydrogen economy can be established in Germany and how hydrogen can be integrated into the energy system of the future.

Since 2014, the Federal Ministry for Economic Affairs and Climate Action has been engaged in initiating energy research networks in important areas of energy research. In addition to promoting participation and transparency, the aim of the networks is to accelerate the transfer of results and ensure the quality of research findings. The results of the network's activities are incorporated into the ministry’s strategic considerations for future energy research policy.

The open expert networks bring together more than 4,000 experts (as of October 2021). Through their exchange, they help to transfer the results of energy research directly to the stakeholders of the energy transition, to discuss practical funding strategies in a topic-focused manner, and to propose new measures. This will place a focus on transparency and efficiency in energy research.

Research and Innovation Platform for the energy transition

The work of the energy research networks initiated by the Federal Ministry for Economic Affairs and Climate Action as a permanent project provides the substantive basis for the Research and Innovation Platform.

As a strategic advisory body of the Federal Ministry for Economic Affairs and Climate Action, the Research and Innovation Platform brings together high-level stakeholders from government, business, science and civil society. It involves all federal and Länder ministries covering matters of energy research. Together, they discuss and evaluate current developments and research strategies.

The Research and Innovation Platform integrates all three pillars of energy research: basic research, applied research, and market-related research via the Living Labs for the Energy Transition.

The Federal Ministry for Economic Affairs and Climate Action operates a central information system on energy research, called EnArgus. It provides information on both current and completed research projects related to energy research. There is a search function with a filter to find specific projects. In addition, users of the system will find facts and figures on the funding provided for each of the priority research fields. There is also a wiki explaining technical terms.

All final reports on the ministry’s research projects are stored at the German National Library of Science and Technology (TIB) in Hanover. The online versions are available for download free of charge.

The website www.energieforschung.de provides information on all aspects of the Federal Ministry for Economic Affairs and Climate Action’s project funding in applied energy research. It describes how to apply for funding, presents current calls for proposals and offers general information on the ministry's funding strategy in the 7th Energy Research Programme. The Programme is explained in more detail, including the individual funding priorities, the background to the development of the programme and the consultation process. In the ‘Für Antragssteller‘ [for applicants] section, those interested in applying for funding can find useful hints and information on the application process. The ‘Reallabore der Energiewende‘ [Living Labs for the Energy Transition] section provides information on this market-oriented funding instrument.

News, interviews and portraits on current research projects funded by the Federal Ministry for Economic Affairs and Climate Action are available on dedicated websites for each of the priority research fields:

• Energy-optimised buildings and neighbourhoods: energiewendebauen.de
• The energy transition in industry: industrie-energieforschung.de
• Grid and networks, storage, sector coupling and cross-system issues: energiesystem-forschung.de
• Forward-looking power generation technologies: strom-forschung.de
• Newsletter on applied energy research: newsletter-energieforschung.de

In order to inform the public about the diverse research activities taking place in the field of innovative energy technologies under the 7th Energy Research Programme, the Federal Ministry for Economic Affairs and Climate Action publishes a Federal Energy Research Report on an annual basis. The report serves to give a detailed and transparent overview of the Federal Government's research promotion policy in the field of energy. It reports on progress, current developments and on priority areas in research promotion in a transparent manner, and presents selected flagship projects. The Federal Report on Energy Research also updates the figures on the EU Framework Programme for Research ‘Horizon Europe’ (known until 2020 as Horizont 2020) and on energy research undertaken by the Länder.

The figures for project funding cited in the Federal Report on Energy Research are available at EnArgus, the Economic Affairs Ministry’s central energy research information system, where they are set out in a transparent manner.

In 2020, the Federal Government spent around €1.22 billion on research, development and the demonstration of modern energy technologies. This means that total funding has been increased by six per cent compared with the previous year (2019: €1.15 billion). This underlines the central role of energy research in paving the way for the energy transition and providing stimulus for the energy industry.

International research cooperation is becoming increasingly more important. Germany is closely involved in international energy research. The research cooperation engaged in by the Federal Ministry for Economic Affairs and Climate Action is based on three pillars:

• energy research in the European Union
• energy research in the International Energy Agency, and
• multilateral energy research initiatives

Energy research in the EU

The Strategic Energy Technology Plan (SET Plan) is a European strategy that has set the guidelines for EU energy research funding since 2008. It is constantly adapted to take account of significant developments and challenges as well as the EU's energy and climate targets. Using a holistic approach involving all relevant stakeholders, an integrated roadmap is developed that defines the priorities for research, development and innovation.

The EU supports research, development and innovation based on multiannual framework programmes. The goal is to strengthen the scientific and technological foundations of the industry, to foster the development of its international competitiveness, and to expand the European Research Area (ERA). In the Horizont Europe programme, the funding of research and innovation activities in the field of non-nuclear and clean energies is pooled in Cluster 5 ‘Climate, Energy and Mobility’. Around €15 billion has been earmarked for this cluster over the term of the programme from 2021 to 2027.

Those interested in applying for funding can contact the National Contact Point (NCP) for Climate, Energy and Mobility, that supports applicants with technical competence within the energy topics. The NCP advises German companies, public authorities, universities and research institutions free of charge on behalf of the Federal Ministry for Economic Affairs and Climate Action.

In order to develop synergies between national and European funding policies, the Federal Ministry for Economic Affairs and Climate Action supports European partnerships within the framework of Horizon Europe, which also publish their own calls for funding. There are five partnerships planned in the energy sector: Clean Hydrogen, Clean Energy Transition Partnership (CETP), Driving urban transitions to a sustainable future (DUT), Built4People, and a partnership on batteries.

Energy research in the International Energy Agency

The International Energy Agency (IEA) offers its 30 member states a broad forum for the joint coordination of key energy issues. It also provides a platform for international research cooperation, which takes place under the ‘Technology Collaboration Programmes’ (TCP). The priorities are renewable energies, fossil fuels, energy efficiency and nuclear fusion. Germany is currently involved in 22 out of 38 ongoing TCPs. All of the projects and activities in the field of energy research are coordinated by the Committee on Energy Research and Technology (CERT), in which the Economic Affairs Ministry represents the Federal Government.

Mission Innovation

The Federal Ministry for Economic Affairs and Climate Action is also involved in Mission Innovation, a multilateral initiative founded on the fringes of the 2015 Climate Change Conference in Paris involving 22 countries and the EU. The second phase started in early June 2021, focusing on accelerated innovation transfer, demonstration projects and large-scale implementation. Within the framework of the Energy Research Programme, Germany is primarily active in the initiative on hydrogen (Clean Hydrogen Mission) and is also involved in the initiative on renewable power supply systems (Green Powered Future Mission). In total, the second phase of Mission Innovation is expected to include seven missions.