Elstor

The electrification of industry and the adoption of low-carbon solutions and energy generation are the first steps towards carbon neutrality. Electrification and transition to renewable energy sources are often raised as the most significant climate actions. However, the production of renewable energy requires storage of energy and while electricity production can be emissions-free, the heat and steam required by industrial processes are typically produced with fossil fuels.

Elstor has developed a solution that converts electricity into steam or heat, which can be stored and discharged on demand as required for the customer’s processes. Heat storage reduced the carbon dioxide emissions from industrial steam and heat production by replacing oil, natural gas and LPG as fuels. Elstor’s solution enables the storage of electricity as heat and steam, which is particularly important in the use of locally produced renewable energy.

The Finnish Climate Fund’s funding decisions are subject to three-tier criteria: self-sufficient business operations, verifiable added value in return of State participation in the financing package and compliance with the EU’s six environmental objectives for sustainable financing, known as the ‘do no significant harm’ principle. In addition to the above criteria, emission reduction potential and other impact such as business potential are also required.

Elstor’s heat storage solution combines two elements crucial for achieving carbon-neutral industry: electrification and the storage of renewable energy. Elstor’s market potential of the solution is nearly half a million tonnes of reduced emissions, which accounts for approximately 1% of Finland’s total emissions. With the Finnish Climate Fund loan, the wide-scale rollout of Elstor’s emission-reducing technology will be more efficient than without the funding.

In addition to reducing emissions, this funding decision also benefits the business opportunities of other operators in Finland through lower heat and steam production costs. The solution also has significant export potential as the product responds to a globally recognised demand.

The Finnish Climate Fund offers a capital loan of up to EUR 4 million to finance Elstor’s working capital investments in the next two years. The Finnish Climate Fund loan may be drawn down for each unit separately and the funding for each device is subject to proven reduction in emissions and successfully secured other funding (50% at minimum). In addition, a conversion right is attached to the financing agreement, which means that the Finnish Climate Fund has the option to convert debt into equity shares.

The Climate Fund has revised its impact assessment by reviewing the ten-year emissions reduction potential of the 2021 investment targets for the first time.