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ECO 123 follows the money. Where does the money come from and where does it go?

Saturday, 17th february 2024.

The European Investment Bank (ElB) is the European Union’s long-term lending institution, owned by its 27 Member States. It finances sound investments that contribute to EU policy objectives. EIB’s projects strengthen competitiveness, drive innovation, promote sustainable development, enhance social and territorial cohesion, and support a fair and swift transition to climate neutrality. ECO123 took a closer look at the bank’s activities.

The EIB Group, which also includes the European Investment Fund (EIF), underwrote a total of €88 billion in new financing for over 900 projects in 2023. These commitments are expected to mobilise around €320 billion in investment, supporting 400,000 companies and 5.4 million jobs. What lies hidden behind these numbers?

All projects financed by the EIB Group meet the criteria of the Paris Climate Agreement, says the bank. The EIB Group does not fund investments in fossil fuels. The EIB is on track to deliver a commitment to support €1 trillion in climate and environmental sustainability investment in the decade to 2030, as pledged in its Climate Bank Roadmap. Over half of the EIB Group’s annual financing is used to support projects directly contributing to climate change mitigation and adaptation and leading to a healthier environment.

Approximately half of the EIB’s financing within the European Union is invested in cohesion regions, where per capita income is lower. This underlines the Bank’s commitment to fostering inclusive growth and the convergence of living standards. An example:

The EIB supports Umicore with a €350 million loan for its European research and innovation in electric vehicle battery materials.

The European Investment Bank (EIB) and Umicore (Belgium) have signed a €350 million financing agreement to support Umicore’s research, development and innovation (RDI) in rechargeable battery materials technologies for electric vehicles (EV) and the recycling of electric vehicle batteries. The eight-year loan, benefitting from competitive financing conditions, will contribute to the development of innovative technologies at Umicore’s research centres in Olen and Hoboken (Belgium), Kokkola (Finland), Hanau (Germany) and Nysa (Poland). It follows an earlier €125 million loan that the EIB had granted to Umicore in 2020 to help finance Europe’s first production facility for cathode active materials for electric vehicles in Poland.

The EIB is committed to supporting the development of Europe’s industrial production capacity across the full value chain of electric vehicle battery production. The loan is part of the EU bank’s pledge to commit an additional €45 billion of financing to boost European manufacturing in state-of-the-art strategic net-zero technologies.

Umicore’s battery materials technologies, its innovation roadmap and its complete battery materials supply chain (including refining, the production of both precursor materials and cathode active materials and their recycling) are key contributors to the transition to cleaner mobility and the European Union’s Green Deal ambitions.

EIB Vice-President Robert de Groot said: “In support of the European Green Deal Industrial Plan, the EIB is dedicated to financing cutting-edge European manufacturing in strategic net-zero technologies. This loan for Umicore’s ambitious research, development and innovation programme highlights the EU bank’s important role in shaping the future of Europe’s battery industry, which is a key area for global competitiveness and a sustainable and decarbonised future.” (…)

“Umicore is proud to have secured the EIB’s support for a second time, this time underscoring our long-standing experience and knowledge in battery materials science and technologies. Our leadership and know-how in battery materials foster Europe’s innovation edge and competitiveness amid the worldwide energy transition. This loan further strengthens our balance sheet via long-term funding at attractive conditions and our innovation power in this high-tech industry,” said Umicore’s Chief Executive Officer Mathias Miedreich.

Umicore’s EV battery materials innovations and technologies serve the entry, mass and premium segments of the car market with technologies ranging from nickel, manganese and cobalt to future high lithium manganese and next-generation solid-state and sodium-ion battery technologies (more info here). Umicore also recycles EV battery materials on an industrial scale in Hoboken, Belgium. In 2022, Umicore invested 316 million euros or 7.6 percent of its revenue in research and development.

The EIB has increased its backing of battery-related projects to more than €1.6 billion of financing in 2023. Over the last five years, projects of this kind financed by the EIB have totalled €2.8 billion.

These operations also contribute to the goals set out in REPowerEU and the Green Deal Industrial Plan, which aim to eliminate Europe’s dependence on fossil-fuel imports and provide support for the home-grown manufacturing capacity in net-zero technologies required for a swift and just transition to climate neutrality.

During its research, ECO123 also came across a long-term loan of 115 million euros granted by the EIB to the Portuguese company “Navigator” at the end of 2023. More details on this next week. Stay tuned for more information.

Uwe Heitkamp (64)

trained TV journalist, book author and hobby botanist, father of two grown-up children, knows Portugal for 30 years, founder of ECO123. Translations: Dina Adão, John Elliot, Ruth Correia, Patrícia Lara, Kathleen Becker
Photos: Uwe Heitkamp

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