Technology Readiness Level

Technology Readiness Level (TRL) is a method for estimating the maturity level of a particular technology. It was originally developed by NASA in the 1970s to assess the maturity of space technologies and has since been adapted for use in various industries, including software development.

In the context of software, TRL provides a systematic metric to assess the maturity of software technologies throughout the development process, from the concept phase through development and eventual deployment. It can help manage expectations and risks, plan the software development process, and communicate the status of the software technology to stakeholders.

Here is a general interpretation of TRLs for software development:

1. TRL 1: Basic principles observed and reported. This is the “blue sky” stage, where the fundamental viability of a concept is explored.

2. TRL 2: Technology concept and/or application formulated. Here, the basic concepts have been translated into a software concept.

3. TRL 3: Analytical and experimental critical function and/or characteristic proof of concept. This involves the development of limited functionality to validate key aspects of the technology.

4. TRL 4: Component and/or system validation in a laboratory environment. At this level, a version of the software is developed and tested in a controlled setting.

5. TRL 5: Component and/or system validation in a relevant environment. Here, the software is tested in an environment that closely matches the final application context.

6. TRL 6: System/subsystem model or prototype demonstration in a relevant environment (early prototype). The software is further refined and tested in relevant environments.

7. TRL 7: System prototype demonstration in an operational environment. This involves testing a prototype of the software in the final, operational context.

8. TRL 8: Actual system completed and “flight qualified” through test and demonstration. At this level, the software is finalized and thoroughly tested, ready for deployment.

9. TRL 9: Actual system “flight proven” through successful mission operations. The software is deployed and in operation.

While TRL provides a useful framework, specially in “process heavy” industries, it doesn’t align well with iterative models like Agile or Scrum, where features are continuously developed, integrated, and deployed in cycles.

TRLs and the Frascati Manual

In the context of R&D funding and classification (such as the Frascati Manual or Horizon Europe), the R&D spectrum is usually mapped as follows:

• TRL 1–2: Basic Research
  • Focus: Fundamental scientific principles.
  • Setting: Academic or pure research labs.
• TRL 3–4: Industrial / Applied Research
  • Focus: Proof of concept and validation in a laboratory.
  • Setting: Lab-scale prototypes.
• TRL 5–8: Experimental Development
  • TRL 5: Technology validated in a relevant environment (industrially relevant).
  • TRL 6: Technology demonstrated in a relevant environment (pilot scale).
  • TRL 7: System prototype demonstration in an operational environment.
  • TRL 8: System complete and qualified (the end of “Development”).

TRL & Project Funding in Europe

In the context of European R&D funding, the mapping of Technology Readiness Levels (TRLs) determines not only the maturity of the project but also the maximum “Aid Intensity” (percentage of funding) a company can legally receive.

1. Defining “Experimental Development” (TRL 5–8)

Experimental Development represents the most “industrial” phase of R&D. It bridges the gap between laboratory validation and full commercial deployment. * TRL Range: TRL 5 to TRL 8. * Key Activities: Prototyping, piloting, testing, and validation of new or improved products/processes in environments representative of real-life operating conditions. * The Ceiling: It ends before TRL 9 (Actual system proven in operational environment), at which point the activity becomes Commercialization or Production.

2. The General Rule: Why Funding Drops at High TRLs

Under EU State Aid rules (specifically the GBER), public funding must decrease as a project moves closer to the market to prevent unfair competition.

• Industrial Research (TRL 2–4): High risk, distant from market. Funding cap is typically 50%–70%.
• Experimental Development (TRL 5–8): Lower risk, close to market. Funding cap drops to 25%–45%.

Note: These limits strictly apply to National or Regional funds (e.g., Bpifrance, CDTI, Regional Agencies).

3. The Exceptions: How to Secure 100% Funding at TRL 5–8

Despite the general rule, companies can receive 100% funding for high-TRL activities through specific mechanisms that bypass standard State Aid limitations.

A. EU Direct Management (Horizon Europe)

Funds distributed directly by the European Commission are not considered “State Aid.”

• Innovation Actions (IA): For projects at TRL 5–8, the EU funds 70% of costs for for-profit companies (100% for non-profits).
• Research & Innovation Actions (RIA): Even if elements touch TRL 5, these are funded at 100% for all entities.

B. Cascade Funding (FSTP)

Large EU projects often distribute smaller grants (vouchers) to SMEs.

• These are frequently issued as Lump Sums (e.g., a fixed €60,000 grant).
• Because the source is EU money and the mechanism is a fixed lump sum, the beneficiary effectively receives 100% funding for their pilot or prototype work, ignoring GBER percentage caps.

C. The “De Minimis” Regulation (National/Regional Loophole)

This is the primary method for national governments to fund 100% of a high-TRL project. The EU considers small amounts of aid “negligible” regarding market distortion.

• The Rule: A “Single Undertaking” can receive up to €300,000 in public aid over a rolling 3-year period from a single Member State.
• The Mechanism: If a TRL 6 prototype costs €150,000, a regional agency can grant the full €150,000 (100%) by declaring it “De Minimis.”
• Constraints:
  • Aggregation: You must sum up all De Minimis aid received (grants, subsidized loans, vouchers) in the last 3 years.
  • Single Undertaking: The limit applies to the corporate group (parent + subsidiaries), not just one legal entity.

Summary Matrix

Funding Source	Mechanism	TRL Focus	Typ. Coverage (For-Profit)
National / Regional	Standard Grant (GBER)	TRL 5–8	25% – 45%
National / Regional	De Minimis	Any ( < €300k total)	100%
EU (Direct)	Horizon Europe (RIA)	TRL 1–5	100%
EU (Direct)	Horizon Europe (IA)	TRL 6–8	70%
EU (Cascade)	FSTP / Lump Sum	TRL 5–8	100% (Fixed Amount)

References

https://en.wikipedia.org/wiki/Technology_readiness_level
https://acqnotes.com/acqnote/tasks/technology-readiness-level

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Page last modified: 2025-12-06 08:07:04