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The EU’s Chips Act enters into force: Here’s what it means

Deep tech, Government and policy, Next Featured, Startups and technology / /

The EU’s Chips Act finally entered into force yesterday (September 21), after spending over a year winding its way through the legislature. The landmark law is designed to bolster the bloc’s domestic supply, sovereignty, and competitiveness in the semiconductor sector.

Semiconductor chips are the backbone of all electronic products — and as such, theyr’e fundamental components in everything from smartphones and cars to applications in healthcare, clean energy, and communications. This means chips are also at the centre of geopolitical interests and the global rally for technological supremacy.

“The global race for leadership in chips is a fact and Europe must secure her active part in it,” said Věra Jourová, the Commission’s VP for Values and Transparency. “In the EU we have great talent and research, but we are missing out in linking those advantages with production and rollout of the technology.”

Meanwhile, shortages and frictions in the semiconductor supply chain (especially heightened during the pandemic), exposed the bloc’s heavy reliance on a few foreign suppliers — China and Taiwan for manufacturing, and the US for design.

Europe's market share in chip production by sector
Credit: Council of the European Union

Against this backdrop, the Chips Act has three main objectives: to strengthen domestic manufacturing capacity, boost the European design ecosystem, and support scaleup and innovation across the entire value chain.

Overall, the EU aims to mobilise €43bn in public and private investments, and bring its share in global production capacity from 10% to 20% by 2030.

Three key pillars of action

1. The Chips for Europe Initiative

The Initiative will facilitate the “lab to fab” process and bridge the gap between research and industrialisation. It will receive €3.3bn in EU funding alongside capital from member states. It will support actions including the development of advanced pilot production lines and quantum chips, and the creation of a Chips Fund to provide easier access to debt financing and equity.

2. Boosting investment

To ensure security of supply and boost production capacity, the act will incentivise private and public investments in manufacturing facilities for chipmakers and their suppliers.

3. Coordination

The act has established a coordination mechanism between member states and the Commission to boost collaboration, monitor supply, estimate demand, and trigger a “crisis stage” if necessary. A pilot semiconductor alert system has already been set for shareholders to report supply chain disruptions.

Semiconductor market size by application
Credit: Council of the European Union

“Investment is already happening, coupled with considerable public funding, and a robust regulatory framework,” said Commissioner Thierry Breton.

“We are becoming an industrial powerhouse in the markets of the future — capable of supplying ourselves and the world with both mature and advanced semiconductors. Semiconductors that are essential building blocks of the technologies that will shape our future, our industry, and our defence base.”

The EU’s Chips Act enters into force: Here’s what it means Read More »

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EIF invests €40M in female-founded climate tech growth fund

Ecosystems, Europe, Investors and funding, Next Featured, Sustainability / /

The European Investment Fund (EIF) announced today it would invest €40mn with Blume Equity. Based out of London, the VC was founded by three women in 2020, and invests into European high-growth climate tech scaleups. 

Blume Equity backs companies focusing on decarbonisation as well as broader environmental sustainability. These include carbon accounting platform Normative, sustainable femtech startup Elvie, Matsmart Motatos that looks to combat food waste, and IoT industrial SME data support provider Sensorfact. 

The €40mn comes from the InvestEU program as part of the EIF’s mission to support high-growth and innovative SMEs across Europe, along with a regional mandate from the Dutch Future Fund. EIF joins other Blume Equity investors, including Swedish pension fund AP4 and Visa Foundation. 

“By supporting Blume with one of the largest investments EIF has made to a first time fund, the European Union highlights its commitment both to the environment and to supporting the growth-stage ecosystem in Europe,” said Clare Murray, one of Blume Equity’s co-founders and partners. “This partnership will help us continue our profit with purpose mission to support entrepreneurs tackling the climate emergency.”

Cutting-edge technology to play a major role in EU green transition

Climate tech investment pace has suffered along with other funding over the past year. However, there is reason for optimism for the sector — ironically, much due to the all-too immediate urgency of tangible climate events, such as the wildfires and floods of the summer. 

According to a report published by the Economist last week, VC investment in climate tech has surged over the past decade. Meanwhile, the recent slowing down highlights the need for a diversification of funding sources. This includes government agencies and alternative pools of capital, such as pension funds. 

“The green transition must be accelerated to meet our current climate and environmental challenges,” EIF Chief Executive Marjut Falkstedt commented. “Innovation in all sectors of our economy and cutting-edge technology will play a major role in achieving it. With the backing of the InvestEU programme and the Dutch Future Fund, we are very happy to invest in the female-led Blume Equity Fund to support disruptive businesses with a positive impact on people and planet.”

More money for climate tech to grow

Meanwhile, London-based HSBC also announced today it would make $1bn (€940mn) in funding available to climate tech startups globally. The banking and financial services company said it expected the funds to go toward EV charging, battery storage, carbon removal technologies, and sustainable food and agriculture. Indeed, the Economist study identified food and agriculture technology as a sector that is receiving disproportionately little funding compared to its contribution to global carbon dioxide emissions. 

Furthermore, HSBC also launched a new climate-tech venture capital strategy, and will invest $100mn (€94mn) in Breakthrough Energy Catalyst, a separate platform that supports cleaner energy source technologies.   

“Access to finance is critical for early-stage climate tech companies to create and scale real-world solutions,” said Barry O’Byrne, CEO of global commercial banking at HSBC. They also need ample support in making the jump from early to late stage — a funding gap that is gaining more and more attention. 

EIF invests €40M in female-founded climate tech growth fund Read More »

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Meet the VC on a mission to bridge climate tech’s funding gap

Ecosystems, Investors and funding, Next Featured, Sustainability / /

When it comes to saving the world — or, let’s face it, civilisation, the planet will recover — there is no silver bullet. Rather, it is going to take a holistic approach of caring for the Earth and each other. 

A technological revolution got us into this pickle. Ironically, technology might just be the Hail Mary that will pull us, if not entirely out of it, then at least away from the brink of total disaster. But in order for that to happen, it is us humans who need to set our minds — and money — to it.

Recently launched venture capital firm Transition wants to support emerging technologies looking to help our planet. This includes, but is not exclusive to, reducing carbon emissions. Based out of London with offices in Reykjavik and New York, the climate tech VC is the brainchild of a group of experienced funders who saw a tremendous gap between early stage and later stage funding in the sector. 

“What we saw was that there was this real gap in the market where there was a lot of activity at angel stage and seed stage. And then there is an enormous amount of capital available for later stage investing, which will only grow due to climate-focused targets,” Kristian Branaes, one of Transition’s partners, previously with CPP Investments and Atomico, told TNW. 

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“But there are actually very few companies that make it out from all the great accelerators and incubators that exist, and very few that can absorb a lot of capital,” Branaes added, referring to an increasing interest from very large organisations, such as pension funds, to invest more in clean and climate tech. This means that a lot of technology currently being developed risks being left behind. 

Indeed, data supports Branaes’ and his partners’ observations. A report published by Economist Impact last week found that, in 2021, only 6% of private investment in the sector went to emerging or early-adoption technologies. The remaining 94% was directed towards more mature tech, such as EVs, energy storage, and solar power.

Climate tech lost in translation

The relationship between equity investing and climate tech is an inherently complicated one. The two sectors, finance and science/engineering, not only have a different vocabulary but also work according to very different time horizons. To function well together, the funding side will need to get comfortable with different measures of success and potentially new revenue models. Meanwhile, scientist-founders need to find ways of translating innovation to commercialisation and business plans. 

“We see a lot of scientists coming out of PhD or postdoc, towards the beginning of their academic professional career, that have been very much focused on one topic, or a very narrow scope, and completely understand that topic,” said Transition Venture Partner Bruis Van Vlijmen.  The key to the “translation puzzle,” he states, is to be able to look up and see the complete picture. 

And Van Vlijmen should know. He has trained on traditional thermo-mechanical storage systems at TU Delft in the Netherlands, and worked on ocean wave energy generation at UC Berkeley and energy storage solutions at Stanford, before becoming involved in the VC/startup ecosystem in the SF Bay Area. 

“That translation [between science and business], I think, really comes from being able to kind of download all the scientific knowledge from the depths of your understanding to something like a common playing field and an economic framework that everyone can understand.”

In service of planetary life-support systems

Transition began raising funds in June 2022 (according to a Securities and Exchange filing amounting to $200mn). The firm focuses specifically on companies that will help restore/improve/reduce human detrimental impact on one of the “planetary boundaries.” 

These were defined by a group of researchers in 2009, and are processes that regulate the stability and resilience of the Earth’s system at risk due to human activity — including climate, biodiversity, and land system change. 

Exceeding the safe operation within these boundaries could, the researchers argued, “be deleterious or even catastrophic due to the risk of crossing thresholds that will trigger non-linear, abrupt environmental change within continental- to planetary-scale systems.”

In an update to the study published in Nature earlier this year, scientists found that humans have surpassed seven out of eight boundaries. 

“We think of climate in a slightly broader way, rather than just focusing on, say, a specific CO2 cutoff point,” Branaes said. “And that’s because what matters to us is having a livable prosperous planet for all of us to enjoy.”

Unlocking the business side of innovation

This broader impact strategy is evident in the startups that Transition has chosen to back this far. Among them are Waterplan, which develops software for enterprises to measure, respond, and report on increasingly changing water risk. Others are plant-based plastics developer FabricNano, and SixWheel, which offers a swappable battery solution and charging network for trucks. 

Another still is Phase Biolabs based out of Nottingham, UK, for which Transition led the seed round in 2022. The company uses a gas fermentation process where captured CO2 is introduced into a tank where it is “eaten” by patented microbes, which produces chemicals and fuels, similar to the process of making wine or beer. 

“The biggest thing Transition has done for us is reinforce some of the key things that you need to kind of figure out or unlock on the business side of establishing a new company,” said David Ortega, founder, CEO and CTO, of Phase Biolabs. 

“Because of their diverse and experienced team, they have been able to provide that guidance that someone like me, who lacks that experience, needs to try and make fewer mistakes,” Ortega continued, adding how important it is for scientists to learn how to translate their technology into a value proposition. 

Along with Branaes, Transition’s other partners are Mona Alsubaei (formerly with Union Square Ventures), David Helgason (founder of Unity Technologies), and Ari Helgasson (previously an investor at Index Ventures and Dawn Capital, and co-founder of Uphance and ecommerce startup Fabricly). 

There may not be one single solution that will solve the challenges we collectively face. However, as a Swedish saying goes, “small streams make great rivers.” If all the amazing innovation that exists and is yet to be discovered out there receives the right level of support, we may just stand a chance.  

Meet the VC on a mission to bridge climate tech’s funding gap Read More »

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Improving driver monitoring systems: The case for synthetic data

Deep tech, Next Featured, Startups and technology / /

Driver monitoring systems (DMS) that assess alertness behind the wheel are rapidly becoming the leading automotive safety feature across the globe. In the EU for example, vehicle safety regulator EuroNCAP is requiring all new cars to incorporate a DMS in order to comply with its safety rating.

Amidst this push, startups are benefiting from business opportunities in the DMS space, offering solutions that range from heartmetrics to onset sleep detection. Among them, Swedish Devant is tapping the potential of synthetic data.

Launched in 2021, the startup generates synthetic data of lifelike digital humans to support the training, validation, and testing of machine learning networks — such as the ones behind driver monitoring systems. Specifically, it develops 3D simulated humans that are diverse in both appearance and behaviour across different situations

But how exactly can synthetic data improve DMS? TNW spoke with Richard Bremer, Devant’s co-founder and CEO, to find out more.

The gap synthetic data can fill

Interest in synthetic data started in the early 1990s, and it didn’t take long for the tech industry to realise the technology’s value in accelerating machine learning.

The automotive sector was one of the first proponents of synthetic data, adopting it in the mid-2010s for the development of autonomous vehicles, advanced driver assistance systems (ADAS), and most recently, DMS.

table with driver opinions about distracted driving in the EU in 2019
Driver opinions about distracted driving in the EU, 2019. Source: ESRA Survey/Pires et al.

Driver and occupant monitoring systems (DMS and OMS) typically use infrared cameras and sensors to collect real-time information on the driver and the passengers. Thanks to computer vision and machine learning, this information is then analysed, tracking for instance the driver’s gaze or facial expressions, to determine their alertness and attention to the road.

This means that to perform at their best, both DMS and OMS need to be trained on vast amounts of high-quality data, comprising images and recordings that capture as many diverse situations as possible. Think of drivers texting on their phone, drinking at the wheel, or even leaning to the back seats to stop their children from fighting.

“For any AI network, sufficient data quantity and quality are essential.

While data from cameras and even actor roleplay have fueled the development of DMS so far, using these sources alone to capture every imaginable situation comes with multiple challenges. It’s expensive, time-consuming, limited in variability, and associated with privacy concerns.

That’s where the value of synthetic data comes in, according to Bremer. “The potential and the interesting part about synthetic data is that you can reduce the time and cost and also increase the performance of the network.”

How Devant’s technology works

The Norrköping-based startup uses a step-by-step process on its platform, combining different kinds of 3D assets to create images and animations. In the automotive case, this content can be 3D cabins and people — supplemented with details such as accessories, garments, or eyewear.

Devant synthetic data animation for DMS
Devant’s animation of a driver leaning backwards. Credit: Devant

To ensure a high-quality result that doesn’t tamper with a machine learning network’s performance, the data’s reliability and accuracy are validated via a series of quality assessment systems throughout the entire process.

“When it comes to what we have built, it’s primarily about making sure that the data has been tested and validated,” Bremer says.

Devant’s aim for its 3D human models is threefold: to align with how things look in the real world, to expand their diversity and offer the widest range of different scenarios possible, and to match customer requirements.

For this reason, the Swedish startup offers a configuration tool for users to select the parameters that correspond to their needs. The adjustments can range from more generic variables (such as age, ethnicity, and sex) to more specific details, including clothing, the frequency of the eyelid movement, or the lighting conditions inside a vehicle.

Devant synthetic data animation for DMS
Animation of phone distraction. Credit: Devant

In June, the company joined forces with Australia-based Seeing Machines, a developer of (DMS and OMS) used by major car manufacturers.

Through the partnership, Seeing Machines will use Devant’s 3D simulations to train and validate its machine learning networks, aiming to further advance its in-cabin monitoring systems and create a large-scale dataset of distracted driver behaviours that align with the EuroNCAP requirements.

Quality just as essential as quantity

To truly tap the potential of synthetic data, it’s not just about hitting a button and generating millions of images within a few days, Bremer explains. It’s also about the data’s quality and accuracy.

The premise is simple. “For any AI network to perform as well as possible, sufficient quantity and sufficient quality are essential.”

The promising aspect about computer-generated data is that “we know exactly down to pixel level what every single image contains thanks to its accompanying metadata,” Bremer says. In contrast, when it comes to real-world data, “you do not have that level of granular control and accuracy as you do with synthetic data.”

Devant 3D animation for driver monitoring systems
Animation of driver leaning backwards. Credit: Devant

But there’s a catch. The more you increase the data’s quality by adding more parameters and realism to cover the vast amount of possible scenarios and human behaviours, the more complex it becomes. This, in turn, increases rendering times.

“That’s why no one before us has taken this quality approach to synthetic data, because it’s so costly in terms of rendering times,” Bremer claims. In fact, Devant struggled quite some time to solve the puzzle of maintaining quality, while optimising speed.

Current limitations

Despite synthetic data’s obvious advantage in quantity and its ability to provide accurate, high-quality simulations, Bremer emphasises that the technology shouldn’t be seen as “a silver bullet.” At least, not yet.

Instead, he says, replacing real-world data with their computer-generated equivalent should be done with a step-by-step, cautious approach.

“I think that the most important thing to remember here is that DMS are life-critical systems,” he notes. And there’s still a number of challenges to overcome — which go beyond the need to have thousands of 3D models to ensure sufficient coverage.

Richard Bremer, Devant's CEO and co-founder
Richard Bremer, Devant’s co-founder and CEO. Credit: Devant

The first challenge is establishing a threshold for what constitutes good and bad data, which Devant will explore in collaboration with Seeing Machines. The second is identifying exactly what data the machine learning network will recognise as important enough to use.

The startup is also putting additional effort into covering more aspects of camera optics. “Simulating different camera parameters is very complex, especially when you need to do it within a limited rendering time per image,” Bremer explains.

The way forward

So far, Devant has been working on the various levels of driver distraction, focusing especially on realistically simulating the eye, with its different movements, eyelid behaviours, and varied pupil sizes.

Through the partnership with Seeing Machines, the startup aims to climb the complexity ladder and keep on adding features that will cover the entire EuroNCAP protocol. From there, Bremer sees drowsiness as the “next natural thing,” with intoxication being another interesting possibility on the company’s list.

Devant’s decision to develop human-centric synthetic data for the automotive industry was a targeted one from the outset, driven by the business opportunity presented by the increasing attention to DMS and the impending EU regulations. According to Bremer, it was also about generating actual value and using technology in a way that benefits people.

Beyond the automotive space, the startup envisions other potential industries where its tech could make a positive impact, such as training AI systems to detect signs of diseases at an early stage.

Improving driver monitoring systems: The case for synthetic data Read More »

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Europe’s homes are wasting too much energy – these startups have a plan

Europe, Next Featured, Startups and technology, Sustainability / /

Single-glazing. Old electric-powered heat emitters. Walls with hardly any insulation. Damp throughout the ground floor. Welcome to Europe. 

While these problems vary in prevalence from country to country, even nations rated highly in assessments of household energy efficiency have room for improvement. Sweden, for instance, often does very well in such analyses. But for Magnus Petersson, cofounder and chief executive of Stockholm-based Dryft, there’s plenty of work still to do.

“We need to fundamentally transform the houses,” he says. Dryft, a startup with 150 employees that has raised €6 million to date, numbers itself among a fleet of new businesses targeting the energy renovation market. 

Petersson and his fellow cofounders noticed rising demand for home retrofits around 2019. That demand has only rocketed since because of energy price rises caused by Russia’s invasion of Ukraine.

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Dryft and others like them are using tech to help homeowners find out how efficient their home really is — and what they can do to improve it. The treatments these firms propose will differ dramatically from house to house but the idea in general is to offer “holistic” advice.

Companies such as Dryft aren’t just about selling you a new heating system – the point, they say, is to find out the most suitable methods for making a dwelling more efficient within a certain budget, whatever those methods may be. 

Some homes will need lots more insulation, while others will already have that but require a more efficient method of ventilating the internal spaces, for example. Where would a homeowner’s cash best be spent?

Energy Tetris

“When we sell energy renovation to you as a customer, that energy renovation is a Tetris made up of different services,” says Petersson, referring to the popular block-sorting video game in his analogy. 

With Dryft, customers get a free 30-minute video consultation where they can talk through features of their property with an energy adviser. This yields a summary of what kind of retrofit might best suit the dwelling and how much it could cost. If the customer decides to proceed, Dryft conducts a more in-depth survey and can then go on and actually do the required renovation work as well.

The company currently covers the Greater Stockholm area but has plans to expand across Europe. Since 2020, Dryft has carried out renovation projects large and small in nearly 6,000 homes.

Petersson explains how the firm’s algorithm estimates the projected energy savings post-renovation. This algorithm is constantly being refined with data on the outcome of real Dryft projects, he adds, meaning that it ought to get more and more accurate over time. 

As an example, he shares a case study of a 1970-built, four-bedroom house in Stockholm. Dryft upgraded the double-glazing to triple-glazing, installed a heat pump, ventilation system with heat recovery, and also some smart controls. The whole renovation cost the equivalent of €38,000 and the household is currently saving €2,900 per year in energy expenditure. 

At that rate, it will take about 12-13 years to recoup the investment. In the meantime, annual energy consumption in the property has plummeted by more than 40% and its Energy Performance Certificate (EPC) rating has jumped from G to C. This should increase the value of the property, notes Petersson.

Show me the money

There’s no doubt that extensive energy retrofits are not cheap. Dryft and startups in the same market are also trying to help customers take advantage of government subsidies or grants. 

“People are planning renovation roadmaps and that is what we are actually showing to our customers,” explains Justus Menten, cofounder of Enter, an energy retrofit-focused startup in Berlin. 

Enter offers financing options to help people pay for their energy renovation in instalments and the firm supports customers in seeking out applicable subsidies that could lessen the upfront cost of the work they want to do. Enter works with partner companies who carry out the actual plumbing, engineering work, or installation of insulation, for example.

The startup, which has 135 employees and has raised €19.4 million so far, has around 1,000 paying customers per month, adds Menten. Enter has an app that can estimate the energy demands of a dwelling and how specific retrofit projects — say, upgrading the loft insulation — will impact that. 

Customers can try out different energy renovation measures and see the projected results in terms of emissions savings, reduced costs, and the potential increased value of their property, for example. A virtual retrofit before you decide on the real thing.

Enter also has a team of experts who subsequently survey each dwelling and confirm the accuracy of the app’s suggestions and projections.

Tools that help homeowners understand what renovation measures are available, and what their impacts might be, are much needed at present, say observers.

“From my research, there is a huge gap for householders to find high-quality information – that can delay renovations taking place,” says Kate Simpson at Imperial College London, who has studied the use of data in energy renovations. She notes that it can be difficult to accurately predict energy savings post-renovation because there are so many factors that affect consumption, from the weather to how much the occupants decide to heat their home.

Crucially, startups gathering data about energy consumption must ensure that they have consent to do so, she adds.

Data is key

Data protection is very important, though access to useful information on the current energy efficiency of homes around Europe is far from standardised, notes Michael Hanratty, chief executive of BERWOW, a startup in the Republic of Ireland. 

BERWOW uses an automated tool to analyse data from the Irish equivalent of an EPC – a Building Energy Rating (BER) certificate. The tool proposes energy renovation interventions that might be suitable for a given dwelling. These suggestions can be followed up with an on-site survey to get formal quotations for specific works.

Hanratty explains that the firm’s digital tool, built by Dublin-based tech firm Gamma Location Labs, was ready to go in 2017 but new GDPR legislation regarding data protection in 2018 meant BERWOW had to come up with a different system for accessing individual users’ own BER certificates. It requires users to provide their unique electricity meter number and upload proof of address to an online system before the BER can be released to BERWOW for analysis. 

“You’d imagine with the urgency of the climate crisis that there could be easier solutions to accessing this data,” says Hanratty. Homeowners who don’t yet have a BER for their property, or who don’t want to open up access to it, can select from one of 60 generalised Irish dwelling types to get an approximated result.

Hanratty adds that he hopes to expand BERWOW to other countries, though the methodology for retrieving EPC information differs greatly from country to country within Europe, he points out. 

Since launch, BERWOW has clocked more than 60,000 visitors to its live tool, which is published on the websites of SSE Airtricity, a major local energy provider in Ireland, among others. Those initial enquiries have resulted in a total of 2,400 surveys of properties to date. 

BERWOW has one employee — Hanratty — and has not needed to raise any external funding, besides initial research funding of €112,000 from the Sustainable Energy Authority of Ireland.

Thinking big

There are plenty of private homeowners with the means to carry out their own renovations around the continent. But they are just one slice of the pie. What about the big businesses that construct large residential developments, or social housing providers?

In the UK, Hubb is targeting such organisations. The company has its own software that creates a digital twin of a specific property. Hubb’s machine learning system can then model how to make each dwelling more energy efficient. Founder and chief executive James Major says he wants to do this on a big scale and is currently in discussions with two large companies in the UK — though no contracts have been signed just yet.

Major wants to demonstrate to firms constructing thousands of houses that, should they improve the energy performance of these buildings even slightly, there could be massive reductions in demand on the electricity grid, for instance.

“If you increase your fabric improvements by 10% or 15%, we could save X amounts of megawatts that you need to connect to your development,” says Major. And this could apply to existing properties requiring a retrofit, too. Doing it at scale would in principle cut down local energy demand drastically.

With the climate crisis worsening while millions of homes around Europe still require energy renovations of some kind, and with consumers expressing their desire to spend significantly less on heating in our age of inflation, it may be time to think big – and fast — about retrofits.

Europe’s homes are wasting too much energy – these startups have a plan Read More »

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EU has ‘no chance’ of semiconductor independence — but neither does anyone else

Corporates and innovation, Ecosystems, Government and policy, Investors and funding, Next Featured / /

Our world runs on semiconductors. The slivers of silicon provide electronic brains to phones, computers, cars, data centres, and stock markets. They’re also the digital backbone of modern militaries. 

Some of the first chips ever made were used in missile guidance systems. Today, they power countless military devices, from fighter jets and howitzers to radios and radar.

In the Russian-Ukraine war, chips power HIMARS rocket launchers, Javelin anti-tank missiles, and the Starlink communications satellites. They’re also integral to the arms race underway in East Asia, where territorial disputes in the East and South China Seas risk spiralling into a major conflict. The rise of artificial intelligence adds another dimension to the tensions: there’s now a dearth of AI chips.

In the EU, the shortages and frictions have led the bloc to introduce the €43bn Chips Act. The investment package aims to boost local production and reduce international dependencies. Experts, however, have downplayed any prospects of sovereignty.

According to Chris Miller, the author of Chip War, the EU has “no chance” of semiconductor independence — and neither does anybody else.

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The problem, he argues, is that the supply chain is simply too globalised and interconnected.

“Independence is hopeless,” Miller, an economic historian, told TNW at the IFA Berlin tech show. “It’s not going to happen — nor do I think Europe is pushing for it.”

A divided industry

In Chip War, Miller recounts the decades-long battle to control semiconductors, which today centres on the rivalry between the US and China. Tensions between the nations have torn the chip world into two.

As the fractures widen, Beijing is trying to bolster self-sufficiency in semiconductors.  It’s currently the world’s largest importer of the devices, spending more money importing them than it does on oil.

A portrait photo of Chris Miller, the author of Chip War
Miller is currently a history professor at Tufts University and a visiting fellow at the American Enterprise Institute. Credit: Chris Miller

To constrain China’s ambitions, Washington has imposed sweeping export controls on chip tech. In 2022, the Biden administration imposed its toughest sanctions yet. Under the new rules, the White House could block not only sales of chips made in the US, but also chips that use American components or software.

The move has disrupted China’s trade with Taiwan, which produces over 60% of the world’s semiconductors — and over 90% of the most advanced ones.

Beijing has also encountered problems in the EU, which has its own chip powerhouse: ASML.

The Dutch company is the world’s leading manufacturer of high-end chipmaking equipment. Without its gear, Chinese firms will struggle to produce advanced chips.

That outcome could soon become a reality.

Europe’s chip future

Amid pressure from the US, the Netherlands began restricting exports of advanced chip manufacturing equipment on September 1.

The move has sparked fears that China will impose retaliatory restrictions. Miller, however, expects Beijing to proceed with caution. He notes that retaliation could backfire.

“China could cause disruptions in supply chains, but they could be just as impacted by the disruptions as the West is,” he said.

Nonetheless, the discord has amplified calls for autonomy.  In response, the EU has made plans to produce 20% of the world’s semiconductors — double its current share — by 2030.

It’s a target that Miller believes is “possible,” but only with strong support from the member states and companies.

A precedent for this approach has been set this year in Germany. After offers of enormous subsidies, both Intel and Taiwan’s TSMC have pledged to build chip factories in the country.

Ultimately, semiconductor independence may be impossible — but the EU already has some unique strengths. In machine tools and power semiconductors, for instance, the bloc is home to some of the world leaders.

“I think Europe should keep focusing on what it’s historically been very good at, which is investing in R&D-intensive manufacturing industries,” said Miller.

“The goal is to have profitable chip companies with technological leadership positions — and Europe has that.”

EU has ‘no chance’ of semiconductor independence — but neither does anyone else Read More »

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World’s first crewed liquid hydrogen plane takes off

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At a somewhat small and unassuming airport in Maribor, Slovenia, German hydrogen propulsion startup H2FLY has quietly been building up to a major milestone in zero-emission aviation over the summer. And all the hard work has come to fruition, with the successful completion of the world’s first crewed liquid hydrogen-powered flights. 

Before any aviation history enthusiast out there goes “but what about the Tupolev Tu-155?” — yes, the Soviets did try out liquid hydrogen as fuel 35 years ago, but only for one of the three engines. In contrast, H2FLY’s HY4 has now operated using only liquid hydrogen (as opposed to the gaseous kind) as fuel, relying solely on the hydrogen fuel-cell powertrain for the entire flight.

On Thursday, this TNW reporter was present for the fourth in a series of test flights. The event marked the culmination of Project HEAVEN, an EU-funded partnership undertaking to demonstrate the feasibility of using liquid, cryogenic hydrogen in aircraft. (That is short for High powEr density FC System for Aerial Passenger VEhicle fueled by liquid HydrogeN, just FYI.)

Liquid vs. gaseous hydrogen as aircraft fuel

While yesterday’s demonstration flight lasted somewhere around the 10-minute mark, a few days prior, the HY4 and its two pilots stayed in the air for 3 hours and 1 minute — a feat that required 10kg of hydrogen. If using up the aircraft’s full storage capacity of 24kg, it could stay up for 8 hours. 

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“It feels really amazing, it is the perfect teamwork coming to life,” said one of the pilots, Johannes Garbino-Anton, after the flight. He added that the technology “works perfectly,” and that the biggest difference to a normal aircraft is the lack of vibrations and noise. And, the lack of carbon dioxide emissions. 

The two test pilots after the flight
The mood was distinctly jubilant following the series of four successful test flights. Credit: Linnea Ahlgren/TNW

H2FLY’s propulsion system consists of hydrogen storage, a 120kW fuel-cell energy converter, and an electrical engine. All in all, this summer was H2FLY’s eight flight test campaign. The hydrogen-electric HY4 has been flying since 2016, but this summer’s breakthrough consists of operating the plane on liquid hydrogen, as opposed to hydrogen as gas. 

Liquid hydrogen is more energy dense than its gaseous counterpart. That means that it requires significantly lower tank weights and volume. In the world of air transport, especially when retrofitting planes, this equals not having to throw out as many passenger seats, or reduce cargo space, i.e. payload. 

But perhaps more significantly, it unlocks a much greater range. For the HY4 test aircraft, this equals 750km on gaseous hydrogen vs. 1,500km on liquid — or double the distance. On the other hand, liquid hydrogen requires cryogenic temperatures (around -253°C), which adds to the complexity of transporting and refuelling. 

Retrofitting existing airframes with hydrogen fuel-cell propulsion system

The HY4, made out of glass fibre and carbon fibre, will not go into commercial production. The next step from H2FLY will now be to scale the fuel-cell system to megawatt capacity. The H2F-175 system will unlock not only longer range, but also altitudes of up to 27,000 feet. In a partnership with Deutsche Aircraft, the two intend to retrofit a 30-seat Dornier 328 demonstrator with H2FLY hydrogen-electric fuel cells and begin test flights by 2025.