Innovation Action (IA)

An Innovation Action is a Horizon Europe grant type that funds activities directly aimed at producing plans, arrangements, or designs for new, altered, or improved products, processes, or services. Defined by Article 2 of Regulation (EU) 2021/695, IAs focus on bringing research results closer to market readiness, typically covering Technology Readiness Levels (TRL) 5-8, from technology validated in a relevant environment to a market-ready system. IAs are the primary instrument for demonstration, piloting, and first-of-a-kind deployment projects within the Horizon Europe framework.

How It Works

Innovation Actions bridge the gap between laboratory research and commercial deployment. While Research and Innovation Actions (RIA) focus on creating new knowledge and proving technological feasibility (TRL 2-6), IAs take validated concepts and scale them toward market introduction.

A typical IA project involves a consortium of 5-15 partners, including research institutions that contributed to the underlying science, industrial partners that will develop and deploy the innovation, end users that will test and validate the results in operational environments, and SMEs or startups that may commercialize the outcomes.

The key characteristics of an Innovation Action are:

Funding rate. IAs are funded at 70% for for-profit entities (companies) and 100% for non-profit entities (universities, research centers, public bodies). This split funding rate reflects the closer proximity to market: companies are expected to co-invest 30% because they will be the primary commercial beneficiaries of the results. This is the fundamental distinction from RIAs, where all participants receive 100% funding.

TRL range (5-8). IA activities typically include technology validation in an industrially relevant environment (TRL 5), technology demonstrated in a relevant environment (TRL 6), system prototype demonstration in an operational environment (TRL 7), and system complete and qualified (TRL 8). Some IAs may include limited research activities at lower TRLs if necessary to adapt the technology, but the bulk of effort must focus on demonstration and deployment.

Typical budget. IA budgets range from EUR 3 million to EUR 15 million, though some large-scale demonstration topics may provide EUR 20 million or more. The budget must cover all project activities, including the 30% co-financing from for-profit partners, which must come from the companies' own resources (not from other EU grants).

Duration. Most IAs run for 36-48 months, providing sufficient time for pilot development, operational testing, and market preparation activities.

Proposal page limit. IA proposals are limited to 40 pages for the technical description (Part B, Sections 1-3), or 45 pages if the topic uses lump sum funding.

The implementation of an IA follows the standard Horizon Europe project lifecycle: work packages define the project structure, deliverables document outputs, milestones mark progress checkpoints, and periodic reports demonstrate technical and financial progress. The key distinction from RIAs is the emphasis on exploitation and market uptake: IA projects are expected to produce a detailed exploitation plan and demonstrate a credible pathway from the project results to commercial products, services, or policy changes.

Legal Framework

Article 2 of Regulation (EU) 2021/695 defines Innovation Actions as one of the core grant types under Horizon Europe. The regulation specifies that IAs primarily consist of activities directly aiming at producing plans and arrangements or designs for new, altered, or improved products, processes, or services, and may include prototyping, testing, demonstrating, piloting, large-scale product validation, and market replication.

Article 18(1) of the same regulation establishes the funding rates: a maximum of 70% of eligible costs for for-profit legal entities and a maximum of 100% of eligible costs for non-profit legal entities. These rates apply to direct eligible costs, with indirect costs calculated at the 25% flat rate on eligible direct costs (excluding subcontracting and financial support to third parties).

The Horizon Europe Work Programmes specify which call topics are designated as IAs (identified by the code HORIZON-IA in the topic identifier). The work programme defines the scope, expected outcomes, available budget, and any specific eligibility or evaluation conditions for each IA topic.

Evaluation of IA proposals follows the standard three-criteria framework: Excellence, Impact, and Quality and Efficiency of the Implementation. However, for IAs, the Impact criterion is weighted at 1.5 times during the ranking of proposals. This means that if two proposals receive the same total score, the one with the higher Impact score is ranked higher. The increased weight on Impact reflects the IA's primary purpose of achieving market deployment and societal benefit.

The consortium requirements follow the standard Horizon Europe rules: a minimum of three independent legal entities from three different EU Member States or Associated Countries. In practice, IA consortia tend to be larger than RIA consortia because they require a broader mix of partners spanning the innovation chain from technology developers to end users and market deployers.

Practical Examples

Example 1: Smart Grid Demonstration. A consortium of 12 partners responds to a Cluster 5 (Climate, Energy, and Mobility) IA topic on smart grid integration. The project installs and tests an advanced grid management system across three pilot sites in Germany, Spain, and Portugal. Two technology companies co-fund 30% of their costs, developing the software platform. Three distribution system operators provide pilot sites and operational feedback. Four research centers contribute analytics and optimization algorithms (funded at 100%). The project budget is EUR 10 million over 42 months, producing a validated, market-ready grid management platform.

Example 2: Sustainable Packaging Pilot. An IA under Cluster 6 (Food, Bioeconomy) funds the development and pilot deployment of biodegradable food packaging. A materials company (70% funded) develops the packaging at scale. A food manufacturer (70% funded) tests it in a real supply chain. Two research institutes (100% funded) assess environmental impact and food safety. An SME (70% funded) designs the manufacturing process for mass production. After 36 months, the packaging meets regulatory requirements and enters commercial production.

Example 3: Urban Mobility Platform. A Cluster 5 IA funds the demonstration of a multimodal urban mobility platform across five European cities. The consortium includes two transport technology companies, three city authorities, one non-profit urban planning institute, and two universities. The platform integrates public transit, bike-sharing, and ride-hailing data into a single user application. Cities provide real operational data and pilot infrastructure; companies develop the platform (co-funding 30%); universities evaluate user adoption and environmental impact.

Key Considerations for Suppliers

Budget for the 30% co-financing. If you are a for-profit entity participating in an IA, you will receive only 70% of your eligible costs from the EU grant. The remaining 30% must come from your own resources — this cannot be covered by other EU grants, national subsidies that specifically prohibit co-funding, or revenues from the project itself during its lifetime. Plan your financial participation carefully and ensure your organization can absorb the co-financing burden over the project's 3-4 year duration.

Invest heavily in the Impact section. Because the Impact criterion is weighted 1.5 times during ranking, it can make or break your proposal. A strong Impact section for an IA should include: a detailed market analysis (size, growth, competitors, barriers), a credible exploitation plan for each partner (who will bring what to market, when, and how), quantified Key Exploitation Results (KERs), a communications strategy targeting end users and policymakers, and measurable Key Performance Indicators (KPIs) for market uptake.

Include end users and demand-side partners. Unlike RIAs, which can succeed with a research-focused consortium, IAs require partners that will use, deploy, or purchase the innovation. Evaluators look for "demand pull" — evidence that there is real market demand for the innovation and that the consortium includes partners positioned to act on it. A consortium of only technology developers without end users will score poorly on both Impact and Implementation.

Demonstrate TRL progression. Your proposal should clearly articulate the starting TRL, the target TRL at project end, and the activities that will advance the technology between those levels. Use concrete evidence: "The battery technology has been validated in laboratory conditions (TRL 4, as published in [reference]); this project will demonstrate it in a pilot manufacturing line (TRL 6) and test it in three commercial vehicle prototypes (TRL 7)."

Plan for regulatory and standards engagement. Many IA topics expect projects to contribute to standards development or regulatory processes. If your innovation requires certification, type approval, or regulatory changes, include these activities in your work plan and allocate appropriate budget and expertise.

Grant — The funding mechanism under which Innovation Actions are awarded.
Horizon Europe — The EU programme within which IAs are one of the core grant types.
Research and Innovation Action (RIA) — The complementary grant type focused on earlier-stage research (TRL 2-6), funded at 100% for all entities.
Coordination and Support Action (CSA) — A grant type for coordination, networking, and policy support, not including research or innovation activities.
Funding Rate — The percentage of eligible costs reimbursed by the EU grant, which is 70% (for-profit) / 100% (non-profit) for IAs.
Evaluation Criteria — The criteria used to assess IA proposals, with Impact weighted 1.5x during ranking.

Frequently Asked Questions

What is the main difference between an IA and a RIA?

The fundamental difference is the proximity to market and the funding rate. RIAs fund earlier-stage research (TRL 2-6) at 100% for all participants, focusing on generating new knowledge and proving technological feasibility. IAs fund later-stage innovation (TRL 5-8) at 70% for for-profit entities and 100% for non-profit entities, focusing on demonstrating, piloting, and deploying technologies in operational environments. IAs are expected to produce market-ready or near-market-ready results, while RIAs produce scientific knowledge and proof-of-concept demonstrations.

Why is the funding rate lower for companies in an IA?

The reduced 70% funding rate for for-profit entities in IAs reflects the principle of additionality and the proximity to commercial benefit. Because IA activities (piloting, demonstration, market replication) are closer to generating revenue than RIA activities (basic and applied research), the EU expects companies to co-invest, demonstrating their commitment to exploiting the results. This co-financing also ensures that companies have a financial incentive to drive the project toward commercially viable outcomes rather than treating it purely as a research exercise.

Can a small company afford to participate in an IA?

Yes, but careful financial planning is essential. SMEs participating in IAs must cover 30% of their eligible costs from their own resources. For a company with EUR 500,000 in eligible costs, this means EUR 150,000 of self-financing over the project duration (typically 3-4 years). SMEs should consider: their available reserves, the potential for commercial revenue during or after the project, and whether the experience and intellectual property generated justify the investment. The EIC Accelerator may be a better fit for startups that need both grant funding (at 70%) and equity investment.