The UK's Department of Energy and Climate Change called the move an "injection of cash" into low-carbon innovation.
The Entrepreneurs Fund will be, in a first phase, sourced from a €44-million fund announced earlier this year.
Energy efficiency technologies are among those supported by the fund, taking €12 million from the first chunk of available money, which is now open to applications.
Applicable energy efficiency solutions include building control systems, advanced lighting systems, and space heating and cooling technologies. Some €7.5 million available in the first phase of the fund will go into applications for power generation and energy-storage technology including fuel cells, biomass boilers and heat pumps.
The second phase of the scheme will be launched in early 2013.
“Low-carbon innovation is vital for the growth of our green economy. This investment will help entrepreneurs with novel ideas get designs off the drawing board and into our homes and businesses, helping cut carbon and spur on growth in this exciting market place,” Energy and Climate Change Minister Greg Barker said.