Belgium: EIB and Wallonia sign MoU to create hydrogen industry


EIB | Updated: 13-04-2023 22:29 IST | Created: 13-04-2023 22:29 IST
Belgium: EIB and Wallonia sign MoU to create hydrogen industry
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A memorandum of understanding was signed this morning by the Walloon Region, represented by Minister-President Elio Di Rupo, Vice-President and Minister for the Economy Willy Borsus, Vice-president and Energy Minister Philippe Henry, Minister for Finance Adrien Dolimont, and the European Investment Bank (EIB), represented by Vice-President Kris Peeters.

The agreement seeks to facilitate cooperation between the EIB and Wallonia in the hydrogen sector.

This includes Walloon projects that could be eligible for EIB support in the form of financing, but also guidance and advice. The EIB generally covers up to 50% of a project’s cost through loans. This agreement strengthens the existing close ties between the EIB and Wallonia.

EIB Vice-President Kris Peeters said: “The EIB’s goal is to accelerate the transition from a carbon-intensive economy to a more sustainable and climate-resilient low-carbon economy. It is therefore fully committed to supporting this transformation through a balanced and socially just approach. This is why the EIB has decided to increase its share of financing for projects that support climate and environmental objectives to 50% by 2025. In addition to financing, the EIB provides technical and financial support to determine financing needs and improve the bankability of projects.”

According to the Walloon ministers, “Hydrogen is a vital resource for the energy transition and is a key driver of medium and long-term climate policy. When it comes to developing the potential of hydrogen, Wallonia hopes to become a major European player. This is why the region has sought out a number of hydrogen-related projects and initiatives, financed mostly through its recovery plan.”

Prior to signing the agreement with the EIB, Wallonia had already made headway in the hydrogen sector by backing a number of projects.

As an emerging sector that requires substantial financial support — the reason for the partnership with the EIB — IPCEI projects (important projects of common European interest) have already received €88 million of support from the Walloon Region through the recovery plan for Europe. The projects supported will put Wallonia on the hydrogen map in Europe and globally.

Wallonia has already made progress on the following projects:

Columbus (IPCEI)

This project is a collaboration between ENGIE Electrabel, Carmeuse and John Cockerill. A water electrolysis unit produces the hydrogen necessary for the biomethanation process. The oxygen produced by electrolysis will be partly used in a new lime kiln that uses oxyfuel combustion (without nitrogen). Any oxygen not required by Carmeuse will be put to another use. The new type of lime kiln developed by Carmeuse uses oxygen instead of air (oxyfuel furnace). This combustion process produces the heat necessary to break down limestone into lime, but the flue gases are also treated to recover the carbon dioxide. Alternative fuels may be used, producing flue gases with varying chemical compositions. The recovered carbon dioxide will then be used in a new biomethanation process.

John Cockerill (IPCEI)

The goal of the John Cockerill project is to build a large electrolyser manufacturing plant (100 MW or more) in an EU country that would then produce and export electrolysers. The project is being developed in collaboration with France, which will finance the production of stacks (the electrolysis cell stacks that produce hydrogen) in the Alsace region. The electrolysers would then be assembled at a site in Seraing, Belgium, which has the necessary equipment and expertise in machining, welding and coating. This assembly plant would complement the internal research and development skills of the engineers developing high-performance technology. New technologies in the field of alkaline electrolysis will also be tested in Seraing.

In addition to boosting industry with these highly appealing innovative projects, Columbus and John Cockerill Hydrogen will create 250 full-time equivalent jobs in the hydrogen and decarbonisation sector.

They are also committed to working with Walloon universities and research centres to transfer knowledge.

E-WallonHY (IIS — strategic innovation initiative)

The E-WallonHY project aims to develop a green hydrogen economy in Wallonia covering the various components of the value chain. These include the production of green (electrolytic) hydrogen, its storage and transport, and its use in some of the most promising applications for high-purity hydrogen, including transport, construction and industrial processes such as the production of ammonia.

This agreement marks a new milestone in the structural development of this future industry key to the transition.

Thanks to the agreement, the EIB will:

Exchange information and knowledge on the hydrogen sector to create a common understanding of the challenges and main financing issues;

Collaborate with the Walloon government to identify market needs/gaps and eligible projects;

Assess the possibility of providing technical assistance to better identify priority investments, at the request of the Walloon government;

Share its expertise and explore more complex financing structures that could help accelerate the implementation of investments in the sector;

Play a significant role in building a low-carbon future in Wallonia by evaluating financing for cleaner projects in the region and supporting a green and competitive economy.

Meanwhile, Wallonia is seeking to:

Create the conditions required to speed up the implementation of the projects and initiatives in the Walloon strategic hydrogen plan;

Further strengthen bilateral cooperation with the EIB in order to provide the financial support and technical assistance needed to accelerate investment in the sector;

Help identify projects that are of strategic importance to the Walloon government and that may be eligible for EIB advisory support or technical assistance and/or for EIB financing;

Prepare the ground to attract private sector investment by minimising public funding and using support mechanisms to make projects bankable so that they can be implemented faster;

Invite the EIB to participate in the financing of relevant projects that cannot be covered by the Walloon regional budget;

Discuss national and regional financing programmes, the use of existing EU funds, framework loan co-financing opportunities and the possible provision of new resources to finance projects of particular strategic importance that fall within the EIB Group’s remit;

Explore ways to combine other EIB financing with regional funds (such as for the possible creation of a Walloon hydrogen fund) and with EU funds, including under the Recovery and Resilience Facility and InvestEU.

Wallonie Entreprendre (WE) has been appointed as the intermediary for Wallonia in the cooperation agreement.

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