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European Commission notification decision on IPCEI

The Management Board of Elemental Holding SA with its registered office in Grodzisk Mazowiecki hereby informs that on 9 December this year it was notified of the issuing by the European Commission of a notification decision on projects covered by IMPORTANT PROJECT OF COMMON EUROPEAN INTEREST (IPCEI) ON BATTERIES. This information was also included in Current Report No. 56/2019 published on 9 December 2019.

Elemental Holding SA participates in an integrated project, according to internal market criteria, as part of public aid aimed at implementing significant European objectives. The project is carried out as part of a strategy that includes reducing CO2 emissions, including e-mobility (development of electric transport), changing the energy mix and reducing carbon consumption, and developing the battery market – as a key aspect of modern mobility and increasing the share of renewable energy sources.

The project covers EU countries, including Poland, in the development of the use of lithium-ion batteries and recycling through the development of advanced technologies and systems, as well as IT solutions and software. Decisions on the project financing, if any, will be taken by the Polish authorities. It will support the objectives set out in the Communication on Sustainable Mobility for Europe and the operation of the 7th Integrated Energy Technology Strategy, as well as the EU Renewed Agenda for Research and Innovation and Europe 2020 Flagship initiative involving 18 companies in 7 member states under European industrial policy, and aims at creating a sustainable mobility value chain in the European Union. The project requires development of a new technology and incurring significant developmental, investment and operational expenditures – it is burdened with significant technological risk and is unprofitable due to its significant research and development character. The decision of the European Commission means that granting public aid to companies implementing the project will not violate applicable law.

As mentioned above, under current market conditions the project is unprofitable. The Management Board of Elemental Holding SA estimated the negative project flows at EUR 73 million and submitted an application for public aid to compensate for losses and negative project flows in the research and implementation phase.

The Management Board of Elemental Holding SA will continue activities under the project and will inform about the results of these activities in the form of a current report and on the holding's website.

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