Luxembourg Economy Ministry Grants €224m in Traditional State Aid in 2024

At a press conference on Wednesday 2 July 2025, Luxembourg's Minister of the Economy, SMEs, Energy and Tourism, Lex Delles, presented a review of state aid granted by the Ministry of the Economy in 2024 and its evolution in recent years.

This review covers a range of measures aimed at supporting Luxembourg businesses, from investment aid, innovation aid and business creation aid to ecological transition aid and compensation for additional energy costs. The Ministry of the Economy said this highlights the important role of the directorate-general for financial aid, created in 2024 to centralise and simplify access to the various aid schemes within the ministry.

Traditional Aid Schemes

In 2024, 1,895 applications were processed under "traditional" aid schemes, for a total amount of €224 million. Traditional aid schemes refer to all existing aid that is not linked to crisis support instruments. They include, in particular, financial aid for: research, development and innovation (RDI) projects; environmental and climate protection; SMEs; first-time business startups; electric vehicle (EV) charging infrastructure; the greenhouse gas emissions trading system.

The traditional aid measures granted by the Ministry of Economy in 2024 generated a total of over €550 million in investments in the national economy.

Among these flagship measures, the support for first-time business startups, introduced in July 2023, was "highly successful" in 2024, with 305 applications processed and €2.3 million in aid granted. Two young beneficiary entrepreneurs - Dovile Jasiulevičiūtė (Coconut Paws) and Philippe Schmit (Social Cooling) - shared their experiences at the press conference.

Among the traditional aid programmes, the RDI aid scheme processed 134 applications for a total of €93 million, while calls for strategic projects (HPC, 5G, cybersecurity, defence) generated nearly €6 million in additional funding.

20 startups were selected for the 2024 edition of Fit 4 Start (an acceleration programme launched in 2015), supported by the Ministry of the Economy to the tune of €3 million. The winning companies receive six months of coaching / mentoring, up to €150,000 in funding and free access to coworking spaces, among other benefits.

Calls for projects under the environmental and climate protection aid scheme contributed to the installation of photovoltaic capacity corresponding to the annual electricity consumption of some 3,500 households. A total of 106 applications were processed, granting €52 million in aid. In this context, the ministry noted a sharp increase in applications from SMEs, which rose from 20% of applications in 2019 to 50% in 2024.

The aid scheme for EV charging infrastructure resulted in two calls for projects in 2024. With 108 applications processed, €9 million in aid granted and 917 new charging stations installed, this scheme was deemed "a great success" in 2024.

To further encourage businesses to invest in measures that substantially improve their environmental impact, temporary aid was introduced in 2023 and extended until 30 June 2025. In 2024, 58 applications were approved for a total of €3.8 million in aid.

Support for SMEs has also been strengthened, particularly through the SME aid scheme, with 1,238 projects supported in 2024 for a total of €25 million, generating a total investment of €153 million.

Among the SME aid schemes, the "SME Packages" pursue a dual objective: to encourage companies to make larger investments, but also to support smaller projects. The "Digital", "Sustainability", "Service" and "CSR Starter Kit" SME Packages have recently been supplemented by the "AI" and "Cybersecurity" areas, while adjusting the eligible costs to 70% for projects between €3,000 and €25,000.

Energy Support Scheme

The energy support scheme is a crisis instrument implemented between 2022 and 2024 to cover additional energy costs (electricity, gas, diesel) for businesses. The support scheme to compensate for rising energy prices has granted €131 million to businesses, mostly SMEs, for 3,374 applications processed.

Tax Credit

Following the agreement between the government and social partners to reform the investment tax credit with a view to accelerating the ecological, energy and digital transition, this 18% tax credit applies to projects spread over the 2024 to 2026 fiscal years in the banking, insurance, crafts, logistics, manufacturing and consulting sectors. 56 applications were processed, resulting in €44 million in tax credits and generating a total investment of €246 million.

Outlook

Minister Delles also discussed the outlook for the development of support schemes, highlighting their adaptability and alignment with the priorities of the 2023-2028 government programme: support for the dual transition (ecological and digital), administrative simplification and improved accessibility for SMEs. The minister notably detailed the law of 6 June 2025, aimed at renewing the support schemes for research, development and innovation.

Minister Delles commented: "This assessment demonstrates our continued commitment to supporting our businesses with effective and accessible tools, adapted to current and future realities. In a context marked by a succession of crises, we have been able to offer appropriate tools to help businesses cope with sudden cost increases, particularly in the energy sector. I would also like to emphasise the importance of support for first-time business creation, which provides a real boost to young entrepreneurs in a crucial phase. More generally, our support schemes are constantly adapted to economic and technological developments, as demonstrated by the introduction of the new SME Packages dedicated to artificial intelligence and cybersecurity. Through these supports, we will continue to support businesses in their development, for a strong and sustainable Luxembourg economy."