home-icon/Home / The European Commission has approved the amount of state aid up to EUR 102.9 million for the VIGO Photonics project

The European Commission has approved the amount of state aid up to EUR 102.9 million for the VIGO Photonics project

  • The European Commission has approved public aid for VIGO Photonics up to EUR 102.85 million for the HyperPIC project. The final value of the subsidy will be determined through a competitive procedure in the Funds for Modern Economy programme.

 

  • The HyperPIC project is scheduled to run from 2023 to 2030, and will result in groundbreaking photonic integrated circuits for the infrared market, enabling the introduction of advanced sensory systems into everyday objects, as well as production lines providing a complete supply chain for photonics integrated circuits for the mid-infrared range, enabling VIGO to bring them to market as the first manufacturer worldwide.

 

  • The HyperPIC project is part of the European Important Projects of Common European Interest in Microelectronics and Communication Technologies (IPCEI ME/CT), which aims to strengthen the European microelectronics industry. In addition to VIGO Photonics, major European semiconductor companies are involved in the project.

 

VIGO Photonics (WSE:VGO) was notified by the European Commission of the approval of public aid of up to EUR 102.9 million under the European IPCEI ME/CT mechanism for VIGO Photonics’ HyperPIC project, the main objective of which is to develop a complete generic technology platform integrating key elements of the value chain of photonic integrated circuits (PICs) for the mid-infrared range (Mid-IR Photonic Integrated Circuits, MIRPICs).

IPCEI Mechanism  

The IPCEI Mechanism (Important Projects of Common European Interest) is one of the most important instruments supporting the European Union’s new economic policy and competition policy. Its goal is to strengthen the potential of European industry in the context of global competition. IPCEI ME/CT is the most significant European support instrument for the entire microelectronics, photonics and semiconductor industry.

 

Microelectronic components together with communication network systems and equipment enrich our lives by connecting the physical world with the digital world. The IPCEI ME/CT project is focusing on components that “SENSE, THINK, ACT and COMMUNICATE”. Dedicated technology and expertise as well as high-performance equipment and materials are needed for each of these functional components.

 

These technologies, defined by the European Commission as Key Enabling Technologies, are important for the development of the entire European economy. The IPCEI ME/CT project brings together Europe’s largest semiconductor companies in both microelectronics and photonics.  The project submitted by VIGO Photonics was selected by the Ministry of Development and Technology as the only Polish project within IPCEI ME/CT. A formal competition held by the MoD&T is still planned after the EC’s decision.

 

Description and purpose of the HyperPIC project and its financing

 

The objective of VIGO Photonics’ HyperPIC project is to develop and implement technology for specialised hybrid photonics integrated circuits for the mid-infrared range, and to prepare and launch production lines providing a complete supply chain for MIRPICs. As a result, VIGO Photonics will become the world’s first manufacturer of photonic integrated circuits for mid-infrared (MIRPIC).

The total amount of eligible costs in the project is EUR 253.4 million, and the subsidy may amount to a maximum of EUR 102.9 million (41% of eligible costs). The management of VIGO Photonics anticipates that the project’s eligible costs exceeding the amount of funding from public funds will be covered from the company’s own funds and capital, from debt financing and/or, especially during the FID phase, from other sources such as, among others, strategic project partnership and/or off-balance-sheet financing in the project finance formula.

The management of VIGO Photonics anticipates that the project’s eligible costs exceeding the amount of funding from public funds will be covered from the company’s own funds and capital, from debt financing and/or, especially during the FID phase, from other sources such as, among others, strategic project partnership and/or off-balance-sheet financing in the project finance formula.

HyperPIC project implementation schedule and costs

 

The project is planned to be implemented over the period 2023-2030 in two phases:

 

  • R&D phase (years 2023-2027) – the value of eligible costs in the R&D phase is EUR 34.2 million;

 

  • the FID (First Industrial Deployment) phase (years 2023-2030), comprising investment in a new production line and the production deployment of new products, including the financing of part of the operating costs during the deployment. The value of eligible costs in the FID phase is EUR 219.2 million.

 

After completion of the FID phase, serial production is planned to be launched (after 2030), where no public funding is foreseen for the project.

 

European Commission decision

The European Commission’s decision approves the maximum public aid ceiling for the project and is not equivalent to awarding the subsidy to the Company. The Commission has assessed the proposed project under the EU state aid rules and, in particular, the Communication on important projects of common European interest. The decision on whether to grant funding to the Company and the determination of the final amount of funding will be made through a competitive process under the European Funds for a Modern Economy (FENG) programme. Funding will be available to entities for which the European Commission has issued a positive decision authorising the award of aid. The HyperPIC project was selected by the Ministry of Development and Technology as the only Polish project to participate in the IPCEI ME/CT project. The date for announcing a competition under the FENG programme has not yet been set.

 

HyperPIC project and its importance for VIGO

 

Obtaining the EC decision approving the amount of EU funding for the HyperPIC project is an extremely important milestone for VIGO. The decision will enable us to apply for relevant funds under the European Funds for a Modern Economy programme after positive conclusion of competitive procedure by Ministry of Development and Technology. It will enable us then to implement a long-term investment plan related to the development of HyperPIC technology of which we will be global pioneers. Thanks to the implementation of this project, we will create a strategic potential for the production of photonic integrated circuits for the mid- and far-infrared in Europe, which in turn will allow us not only to maintain the technological advantage of the EU, but also to strengthen the technological potential of the Polish economy, says Adam Piotrowski, CEO of VIGO Photonics.

 

One of the key elements of our strategy is the development of PIC technology. So far, the problem in the development of mid-infrared sensors has been the high price of manufacturing and integrating a single chip, but the current rapid development of photonic component integration technology may open the way for mass-scale production of integrated photonic chips, explains Adam Piotrowski.

 

As a virtually undeveloped area, the mid-infrared market is currently a great business opportunity for technology companies with the right potential and experience, such as VIGO. As an entity with many years of proprietary know-how and high technological competence, we have the prospect of becoming a global pioneer and creator of this very promising market, adds Adam Piotrowski. 

 

At the moment, components for mid-IR are offered as discrete components, requiring the integration and design of complex opto-electronic circuits. The individual functional blocks occupy a large volume and consume a lot of power, making them unsuitable for consumer applications.

 

The implementation of the HyperPIC project will accelerate the development of photonic sensing technologies and, as a result, enable the delivery of a new class of photonics integrated circuits for sensing applications to the market. The introduction of PIC technology will replace existing expensive and complex systems with single chips. Eventually, it will be possible to use single chips with advanced sensory functionality in everyday objects (smartphones, wearables, home appliances, vehicles).

 

The HyperPIC project also fits in with the goals of the IPCEI on Microelectronics and Communication Technologies (IPCEI ME/CT) initiative in the area of processor and chip design for artificial intelligence – in order to provide AI with relevant data, it is necessary to process various physical information flowing from the world around us – temperature, chemical composition, distance from an object, etc. In order to make this possible, it is necessary to develop smart sensors that allow for quick measurements and provide AI systems with structured and reprocessed data, says Adam Piotrowski.

 

Potential clients for HyperPICs will be contractors from all over the world, using solutions in the area of broadly defined sensor technology in their products, i.e. biomedical equipment manufacturers, manufacturers of pollution monitoring devices, critical infrastructure operators, IoT companies, telecommunications operators and integrators, automotive industry, industrial machinery manufacturers and mobile devices manufacturers. The PIC market for mid-infrared sensing is currently non-existent – VIGO will pioneer and create solutions in this area. Meanwhile, the market for large, complex systems is now worth more than EUR 1 billion per year.

In order to implement the HyperPIC project, VIGO Photonics has secured cooperation with the best national and European scientific and technological centres specialising in the technologies for manufacturing, measurement, integration and packaging of photonic integrated circuits. Partners in the project will include such centres as Warsaw University of Technology, Łukasiewicz Research Network’s Institute of Microelectronics and Photonics, Technische Universiteit Eindhoven, Politecnico di Milano, Universitat Politècnica de València and Tyndall Institute.

Development of technology for photonic integrated circuits (PICs) at VIGO

VIGO has been developing photonic integrated circuit technology since 2020 as part of the MIRPIC project, carried out jointly with Warsaw University of Technology and the Institute of Microelectronics and Photonics of the Łukasiewicz Research Network. Within the framework of this project, the consortium has received funding of PLN 26.6 million to develop photonic integrated circuit technology for the 3-5 μm range. This project will result in the first demonstrators of photonic integrated circuits, ready as early as this year.

 

Research work to date has not only succeeded in identifying and solving the basic technological problems of component fabrication and integration, but also in developing a set of basic building blocks (functional blocks) for the technology under development.

 

Further R&D work will focus primarily on expanding the spectral range of operation of the passive and active components included in the PIC, optimising the technology for manufacturing waveguide components, light sources and detectors for the mid-infrared range, and, most importantly, heterogeneous integration and packaging technology. What is also extremely important in the HyperPIC project is the path of development of technology demonstrators – specialised circuits for specific sensory applications, telecommunications, etc., developed and manufactured at VIGO Photonics.

 

HyperPIC project timeline and summary

 

The HyperPIC project timetable calls for the R&D phase to be implemented between 2023 and 2027. The First Industrial Deployment phase (2023-2030) will include the construction of a new production line and the production deployment of new products mass production phase is expected to start from 2031.

The HyperPIC project is a long-term investment program with a positive impact on the competitiveness of the Polish economy. Among other things, it will allow for the Polonisation of the supply chain and spur the development of a Polish photonic technology cluster. It will also create many new jobs, both directly on the project and in the ecosystem of partners and customers, and attract engineering talents to Poland. Thanks to HyperPIC, we will bring to the market a globally innovative product enabling work with, inter alia, consumer electronics, meeting the needs of AI, IoT and Industry 4.0. As a result, thanks to this project, Poland may become a very strong player in Europe in the integrated photonics industry, with VIGO being the driving force behind the whole sector and, with all the proportions maintained, may become a European TSMC.  I am proud that VIGO could take part in such prestigious and important project for the Polish as well as European economy – Adam Piotrowski concludes.

Additional information

 

  • EC press release on approval of public support for an IPCEI ME/CT

https://ec.europa.eu/commission/presscorner/detail/en/IP_23_3087

 

  • Remarks by Executive VP of the EC for A Europe Fit for the Digital Age on IPCEI ME/CT and its importance

https://ec.europa.eu/commission/presscorner/detail/en/speech_23_3158

 

 

 

Contact for media and individual investors:

Piotr Piotrowski, cc group

piotr.piotrowski@ccgroup.pl, +48 697 613 010

 

Contact for institutional investors:

Małgorzata Młynarska, cc group

malgorzata.mlynarska@ccgroup.pl, +48 697 613 709