Estonia is serious about its ambitious climate goals, which include a strong focus on supporting renewable energy projects and sustainable technologies. Skeleton Technologies, believed to be the country’s next unicorn, is the latest example of these efforts. As shared by the Ministry of Economic Affairs and Communications, the European Commission has granted Estonia a state aid permit of €18M to support Skeleton Technologies’ hydrogen technology projects. The company has invested a total of €33.7M in its development centre in Estonia.
The grant will fund research and development of hydrogen technology and establish a module production unit for the transportation sector. Funds from the state budget’s sale of CO2 quotas will be allocated for this purpose. This comes through the pan-European hydrogen program Hy2Move, where Skeleton is joined by industry leaders like Airbus, BMW, and Michelin. The Hy2Move IPCEI program contributes to the European Union’s goal of reducing emissions from the mobility and transport sector by 90% so that the European Union becomes climate-neutral by 2050.
“The knowledge-based economy and the development of new technologies are the future direction of the Estonian economy. It creates new knowledge, high value-added production and well-paid jobs. Skeleton’s investment to develop new hydrogen technology in Estonia will hopefully give impetus to further investments and the formation of a new type of business ecosystem in the field,” said Tiit Riisalo, Minister of Economy and Information Technology.
Estonia’s home-grown CleanTech champion
“Skeleton’s planned development centre is a good example of an innovative clean industry, for which we are creating room for growth with the Climate Safe Economy Act. The Skeleton solution contributes to the reduction of greenhouse gas emissions in the transport sector and provides exciting new opportunities for our smart engineers. Supporting such plans with CO2 funds is a smart use of money,” said Climate Minister Kristen Michal.
While Skeleton also operates in Germany, Finland, and France, its HQ in Estonia plays a key role in the company’s R&D activities. “Skeleton has expanded to Europe, but we are and will remain an Estonian company. Estonia’s decision to join the hydrogen pan-European project provided competitive conditions for expanding our headquarters’ activities. We are participating in a hydrogen project with many of the world’s top companies, including BMW, Airbus, and Michelin. If Europe wants to compete with the US and China, then pan-European cooperation is necessary. Estonian software and engineering talent, paired with the burgeoning hydrogen ecosystem, offers a great growth opportunity for us. We will build on our development and testing centre and software units in Tallinn, which already employ world-class electrical, mechanical, hardware, and IT engineers,” said Taavi Madiberk, CEO and co-founder of Skeleton Technologies.
Over the next six years, the company aims to employ over 200 people in Estonia, creating high-value jobs that will significantly impact the entire Skeleton Group and its activities globally.
So, what’s the end goal? The state-supported project aims to lower the overall cost of owning hydrogen vehicles and promote their use. Skeleton will create an advanced high-power energy storage module to address fuel cell (H2FC) limitations, prolong lifespan, and improve efficiency. Their SuperBattery technology matches the energy and power density needs of hydrogen fuel cells, enabling a more effective energy storage option for hydrogen vehicles. This technology will also reduce reliance on critical raw materials and lessen dependence on materials from outside the European Union.
The effort is also not an overnight success. The European Commission was notified in 2021 about state aid for implementing hydrogen technologies in transportation. Two Estonian companies, Stargate and Elcogen, previously received support from the IPCEI hydrogen program for their development in this field. Both have raised significant rounds in the first half of 2024, making Estonia the leader in DeepTech VC investments in the region.
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