EIB signs SEK 311 million loan with fashion innovator Renewcell in Sweden
The European Investment Bank (EIB) has signed a loan agreement for a maximum amount of SEK 311 million with Renewcell of Sweden. The loan was extended under “InnovFin – EU Finance for Innovators”, with financial support from the European Union under Horizon 2020, the EU’s research and innovation program.
The Sweden-based fashion innovator has come up with a way to turn discarded clothing into Circulose®, a paste from which new fabric can be made, thus boosting the circular economy as a concept in the fashion industry. After proving its concept, Renewcell will use the EIB loan to build its first large-scale textile recycling plant, capable of producing 60,000 tonnes per year, at the Ortviken industrial site near Sundsvall.
Over the next decade, the global middle class is expected to continue to grow, which will lead to an increase in fashion consumption. Thus, and in the perspective of climate change, the fashion industry must move to circularity. In its attempt to make the fashion industry more circular, Renewcell’s technology can be an important factor in achieving the EU’s waste reduction target, as well as setting the tone for the development of the European recycling industry. The company is able to supply commercial volumes of 100% textile-textile recycled material and is now expanding to meet the growing demand for its Circulose® product with support from Europe.
“When it comes to revolutionizing existing industries, it’s really cutting edge,” said Thomas Östros, EIB Vice-President. “As the EU’s climate bank, it is definitely a priority for us to support projects that can overturn current business models, to make them more sustainable, even circular. After funding Northvolt’s new battery concepts and Nilar, here is another innovative Swedish company we are very proud to be behind Renewcell has the potential to significantly reduce the climate impact of the fashion industry, which we are happy to help.
Mariya Gabriel, European Commissioner for Innovation, Research, Culture, Education and Youth, said: “I am delighted to announce our first circular economy project supported under the InnovFin energy demonstration projects. to pave the way for several new projects in this area, which we must accelerate in order to reduce waste and pollution. “
Renewcell CEO Patrik Lundström added: “We see the investment in Ortviken, Sundsvall as part of an industrial shift towards sustainability, in which we place the existing skills, infrastructure and know-how of Swedish industry in a new circular context. We are proud to have the support of the EIB in our efforts to make fashion circular on a large scale. “