(Bloomberg) -- Elyse Energy, a closely held French clean-tech startup, raised about €120 million ($126 million) to produce green fuels for use in chemicals, shipping and aviation.
The funding comprises an equity investment from the Hy24 infrastructure fund, which is taking a minority stake in Elyse, and sales of convertible bonds. It’ll help advance the company’s plans to produce renewable methanol, a chemical feedstock and fuel, and biokerosene for aviation.
The European Union is looking to green fuels to help decarbonize multiple areas of the economy, though some ventures have stalled as they remain far costlier than traditional petrochemicals production. Elyse’s projects include a €700 million e-methanol complex in southeast France — which would combine clean hydrogen with carbon dioxide captured from industrial sites to make the fuel.
Elyse sold convertible bonds to funds managed by Hy24, French state lender Bpifrance, asset manager Mirova SA and Dutch pension fund manager PGGM NV, the company said in a statement Thursday.
“Low-carbon energies such as hydrogen and its derivatives present an opportunity for Europe to regain its energy security and sovereignty,” Pierre-Etienne Franc, co-founder and chief executive officer of Hy24, said in an interview. “European regulations must be clearer, faster and provide stronger first-mover benefits.”
The EU and its member states have introduced incentives to help some of the world’s biggest polluting industries replace imported fossil fuels with cleaner energies. France has provided financial support for clean-hydrogen production equipment, but it has yet to firm up subsidies to buy the gas. By contrast, Germany approved plans to build a €19 billion hydrogen network in October.
“Not helping manufacturers and large industrial users with incentives to use clean hydrogen is putting the French hydrogen ecosystem at risk,” Franc said.
The funding round will enable Elyse to push its most advanced projects to final investment decisions, while expanding its portfolio, the company said.
The €700 million e-methanol project is aimed at supplying chemicals makers and shippers. The firm is also working on a second, €2 billion project to produce e-methanol and e-biokerosene in southern France, and a €300 million e-methanol venture in Spain, President and co-founder Pascal Penicaud said.
“We’re targeting end of 2025, early 2026 to take these three projects to financial investment decision,” Penicaud said in an interview. “They should take about three years to build, commission and ramp up.”
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