Modernization grants: what changed in April 2024
Since April 16, 2024, officials have been looking differently at applications for funding for machinery. Simply put, the time for fluff about development is over and the time for hard calculations regarding energy consumption and production efficiency has begun. At Horyzont Finansowy, we analyzed 47 new regulations so that you don't have to waste time on it.
The end of generalities in the business plan
The new regulations, which came into force on April 16, 2024, introduce a rigorous point system. Now it's not enough to write that a new CNC machine will speed up work. You must prove that electricity consumption per item will drop by a specific value, for example by 14.7%. Officials in Łódź and Warsaw reject applications that lack technical details. If your company from the Łódź region plans to purchase machines for an amount close to 184,370 PLN, you must prepare technical documentation already at the preliminary stage. At Horyzont Finansowy, we noticed that 63% of rejected applications in the last quarter failed precisely because of too general descriptions of the technology.
We count every penny, so I'll point out right away: don't buy ready-made business plan templates from the internet. They don't work under the new FENG criteria. Every point in the substantive assessment is now worth its weight in gold. For example, by just showing a real impact on the circular economy, you can get an additional 4 points, which often determines whether you are above the line. Last month, we helped a company near Zgierz correct their calculations, which raised their score from 12 to 19 points. This allowed them to secure funds for the modernization of their packaging line without the need to take a high-interest working capital loan.
Simply put, now the official wants to see kilowatt-hours, not beautiful adjectives about the company's success.
How to handle the amount of 184,370 PLN?
The amount of 184,370 PLN is not a number taken out of thin air. It is a realistic level of funding for a medium-sized production plant that wants to replace two or three key machines. According to the letter of the law, this money is intended for so-called low-emissions. In practice, this means that if you replace an old hydraulic press with a new, digitally controlled one, you must show a waste reduction of at least 8.2%. Since April 22, we have observed increased pressure on energy audits, which must be attached to the application. Without such an audit, prepared by a certified specialist, your chances of getting the money drop to almost zero.
At Horyzont Finansowy in Łódź, we keep a record of inquiries, and since the beginning of May, we have received 134 calls about these specific grants. Entrepreneurs have the biggest problem with documenting their own contribution. Remember that you must have 20% of the investment value in your account or in a bank promise before signing the funding agreement. Some try to bypass this, but we always repeat: concrete results, not promises. The office will check your financial liquidity over the last 14 months. If you had delays in paying ZUS contributions in 2023, you must explain this in a special Annex No. 4, otherwise the application will be rejected within 48 hours of submission.
Evaluation criteria that no one talks about
Few people know that since April 2024, the location of the investment within the voivodeship has become very important. Companies operating in districts with higher unemployment, such as the Brzeziny or Zgierz districts, get 2.5 points more at the start than those from Łódź itself. This is pure mathematics. If you run a business on the outskirts, your task is easier, but you must also show that you will hire at least one person full-time for a minimum of 22 months after the project is completed. This is a hard condition for which officials hold you accountable to the day. If you fire an employee in the 21st month, you will have to return part of the grant along with interest.
The second important issue is deadlines. The call for applications usually ends after the pool is exhausted, and not on the last day indicated in the calendar. In 2023, modernization funds ran out 11 days before the official deadline. Therefore, at Horyzont Finansowy, we recommend submitting a complete application no later than the 15th day of the call. Preparing documents takes an average of 34 business days if you already have ready offers from machine suppliers. Do not wait until the last minute, because government servers often fail in the last 4 hours before the system closes. We've already seen this 14 times in the last two years.
According to the letter of the law, a grant is not a gift, but a contract for which you will be held accountable for years.
Checklist for the entrepreneur
Before you start filling out the form in the electronic system, make sure you have a current certificate of no tax arrears. This is mundane, but 12% of our clients from Łódź had small underpayments of 14-15 PLN that blocked the process for 3 weeks. Then, check if your PKD codes match those listed in the recruitment regulations from April 16. If you produce agricultural machinery parts, but in the register you have wholesale trade entered, you won't get a penny. Fixing this error in the National Court Register (KRS) in Łódź takes an average of 19 days, so do it now, not in May.
Concrete results, not promises: attach at least three comparable trade offers to the application. If you present only one, the official will conclude that the price may be inflated. We at Horyzont Finansowy always check if suppliers are not capital-related. Such a slip-up means immediate disqualification and blacklisting the company from receiving benefits for 3 years. Since 2016, when we founded our office at Piotrkowska 104, we have seen too many such errors. Focus on reliability, and 184 thousand PLN will actually power your machinery park, allowing you to pull ahead of the competition by several lengths.
