ABB said it has signed a loan agreement with the European Investment Bank to support research and development in its electrification business.

The Swiss-based technology company said on Tuesday it would use the 500 million euro ($547 million, about 4 billion yuan) loan to fund research and development of next-generation power distribution solutions.

ABB said in a statement that the solutions will include circuit breakers and technologies to improve building efficiency and automation.

The company said the money will support research and development projects in several European countries, including Germany, Italy, the Czech Republic, Finland, Norway, Poland and Switzerland.

Details are as follows
The loan from the European Investment Bank (EIB) will help support ABB’s research and development, with a focus on the company’s electrification business
ABB will use EIB funding for next generation power distribution solutions to drive the energy transition and improve efficiency
Funding projects will help the EU achieve its goal of net zero greenhouse gas emissions by 2050

ABB and EU lender the European Investment Bank (EIB) have signed a €500 million financing agreement to support ABB’s research and development in the electrification business area.

Global electricity demand is growing 10 times faster than other energy sources (International Energy Agency: World Energy Outlook 2023), and to address the growing demand in the context of the energy transition, ABB plans to use EIB funding to design and develop next-generation distribution solutions. Development efforts will include solid-state circuit breakers, environmentally friendly switchgear, and technologies to improve building efficiency and automation.

ABB’s solutions are used in commercial buildings, industrial operations or microgrids. The funding will support research and development projects in Germany, Italy, the Czech Republic, Finland, Norway, Poland, Switzerland and several other European countries.

Timo Ihamuotila, ABB’s Chief Financial Officer, said: “We are pleased with our partnership with the EIB, which reflects the key role of electrification in Europe’s energy transition. This is another important recognition of ABB’s innovation and research efforts to enable the transition to a low-carbon society.”

“Electrification is a major tool in the fight against climate change,” said Ambroise Fayole, vice president for environment and climate action at the European Investment Bank. . “Our loan to ABB supports a company with a long history of developing electrical products that promote practical solutions for greening the European economy. ABB’s research will help run homes, factories or transport services with clean energy, which is important if we are to prevent further warming of the planet.”

Eib financing supports the European Green Deal, the EU’s plan to achieve net zero emissions by 2050. Investment in green innovation is necessary for Europe to create a sustainable economy that protects people and creates quality jobs.

At ABB, research and development is key to developing and commercializing technologies that are strategically important to the company’s future growth. Each year, a significant portion of the company’s revenue is invested in research and development – $1.166 billion in 2022, or about 4.0% of consolidated revenue.

Around 7,500 employees work in research and development at ABB, with around 60% focused on digital and software development. ABB collaborates with universities and research institutions in Europe and around the world to build research networks and foster new technologies. To strengthen and accelerate innovation efforts, ABB also invests in and partners with startups.