- The EIB`s venture-debt loan facilitates Sunfire`s development for solid oxide electrolysers for green hydrogen production in industrial settings
- The technology contributes towards Europe’s decarbonisation and the production of affordable energy
- The EIB-loan is supported by the InvestEU-program of the European Union
The European Investment Bank (EIB) is teaming up with private investors to support the development of innovative electrolysis technologies needed for Europe`s green transition. It has agreed to support Germany-based Sunfire`s solid oxide electrolysers toward first commercial production with up to €100 million in venture debt, of which €70 million has been signed..
The EIB`s investment is supported by the InvestEU programme, which aims to trigger more than €372 billion in additional investment across Europe until 2027, including in new technologies. In addition, Sunfire secured additional €215million in a Series E equity financing round.
The agreement will support Sunfire develop electrolysers to produce green hydrogen more energy- and cost-effectively for industry processes, replacing the use of fossil fuels in high energy consuming sectors like chemicals and steel. Likely clients would include fertilizer/ammonia or methanol producers, energy majors and steel mills that are seeking to decarbonize their production.
Sunfire, founded in 2010 and based in Dresden, offers a combination of two complementary and differentiated technology platforms. Sunfire`s pressurized alkaline electrolysers are already installed on an industrial scale today. It`s innovative high-temperature solid oxide electrolysers (SOEC) will be a sought-after option in many applications in the future, because of their higher efficiency.
In the further development of solid oxide electrolysers, Sunfire will seek improvements in stack and module design, implementing new materials and optimizing design, as well as automation and new production techniques, to simplify the production-process.
EIB-Vice President Nicola Beer, responsible for EIB-financing in Germany, said: “To make the green transition work for energy intensive industries, the development of a green hydrogen business environment is crucial. Scalable, reliable and efficient electrolysers are a cornerstone. Therefore, we at the EIB are happy to support Sunfire`s innovative technology.”
Iliana Ivanova, European Commissioner for Innovation, Research, Culture, Education and Youth said: “This investment embodies our commitment to fostering groundbreaking technologies that are pivotal for the green and digital transition. By leveraging both public and private funding, we are reinforcing the EU's position as a global leader in sustainable innovation, ensuring that our industries remain competitive while moving towards a carbon-neutral economy. Together, we are turning ambitious visions for a greener, more resilient Europe into tangible realities.”
The EIB loan comes in the form of equity-type venture debt, with a guarantee under the InvestEU’s Green Transition window that supports the achievement of the EU’s policy objective of decarbonizing the industry. The EIB venture debt loan is a form of finance that meets the needs of fast-growing, innovative companies. These loans complement venture capital financing, with longer tenors than traditional venture debt, and without further diluting the founder`s shares.
Sunfire founder and CEO Nils Aldag said: "The EU is rightly determined to future-proof its industry. This requires a two-pronged approach which helps energy-intensive industries decarbonize and improve the productivity and resilience of its operations, while supporting industrial clean-tech players like Sunfire to be competitive on the global stage. The EIB credit demonstrates that Sunfire can also successfully access the venture debt market. Alongside continued and growing investor backing, it is giving us the confidence to scale the production of the next generation of electrolysers. Investments like this help move ‘Made in Europe’ from an ambition to a reality, and I am delighted about this vote of confidence in our business.”
Background information
EIB
The European Investment Bank (ElB) is the long-term lending institution of the European Union, owned by its Member States. It finances sound investments that contribute to EU policy objectives. EIB projects bolster competitiveness, drive innovation, promote sustainable development, enhance social and territorial cohesion, and support a just and swift transition to climate neutrality. The EIB Group, which also includes the European Investment Fund (EIF), signed 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.
All projects financed by the EIB Group are in line with the Paris Climate Accord. The EIB Group does not fund investments in fossil-fuels and is on track to deliver on its commitment to support €1 trillion in climate and environmental sustainability investment in the decade to 2030 as pledged in the Climate Bank Roadmap. Over half of the EIB Group’s annual financing supports projects directly contributing to climate change mitigation, adaptation, and a healthier environment. Approximately half of the EIB's financing within the EU is directed towards cohesion regions, where per capita income is lower. This underscores the Bank's commitment to fostering inclusive growth and the convergence of living standards.
The InvestEU programme provides the European Union with crucial long-term funding by leveraging substantial private and public funds in support of a sustainable recovery. It also helps mobilise private investments for the European Union’s policy priorities, such as the European Green Deal and the digital transition. The InvestEU programme brings together under one roof the multitude of EU financial instruments currently available to support investment in the European Union, making funding for investment projects in Europe simpler, more efficient and more flexible. The programme consists of three components: the InvestEU Fund, the InvestEU Advisory Hub and the InvestEU Portal. The InvestEU Fund is implemented through financial partners that will invest in projects using the EU budget guarantee of €26.2 billion. The entire budget guarantee will back the investment projects of the implementing partners, increase their risk-bearing capacity and thus mobilise at least €372 billion in additional investment.
Sunfire
Sunfire is a global leader in the production of industrial electrolyzers based on pressurized alkaline and solid oxide (SOEC) technologies. With its electrolysis solutions, Sunfire is addressing a key challenge of today’s energy system: Providing renewable hydrogen and syngas as climate-neutral substitutes for fossil energy. Sunfire’s innovative and proven electrolysis technology enables the transformation of carbon-intensive industries that are currently dependent on fossil-based oil, gas, or coal. The company employs more than 500 people located in Germany and Switzerland.
