In the run-up to France’s presidential election this month, both Emmanuel Macron and Marine Le Pen have promised to deliver France a “revolution”. Yet if the candidates cast their eyes to Hauts-de-France, they will notice a quiet revolution already taking place.
The region is actively implementing what American economist and EU advisor Jeremy Rifkin envisioned in his 2011 book The Third Industrial Revolution. Nicknamed Rev3, the programme involves wide-scale renewable energy implementation alongside a greater use of digital technologies centred around a “circular economy”, an industry designed to reduce waste and increase the lifecycle of resources.
That Hauts-de-France is witnessing the first widescale adoption of Rifkin’s theory is perhaps remarkable given its history of coal mining. However, when the last pit was closed in 1990, employment in the region suffered greatly and its 12.2 percent unemployment rate is one of the highest in France. Now with the rise of a sustainable economy and a new way of living, Rev3 is an attempt to reverse this trend.
Renewable energy lies at the heart of both Rifkin’s ideals and Rev3. The “revolution” envisages the region’s entire energy needs be met by renewables by 2050. In this respect, Hauts-de-France has made significant strides. It ranks second for the most amount of operating wind capacity in the country – with over 2.7GW of renewables installed including 164MW in 2016 – and, according to grid operator RTE, has by far the most wind projects under development.
However, there remains much room for improvement if Hauts-de-France’s lofty ambitions are to be met. Renewables still account for only 11.3 percent of its total electricity consumption, below the national average of 19.6 percent. The high levels of industrialisation and population density in the region means Hauts-de-France consumes
13.9 percent of the country’s gas demand, the third-highest level in France.
There is a need for further investment and in December 2015, about a year after Rev3 was launched, a dedicated investment fund – Cap 3RI – was set up, managed by local investment firms Finorpa and Nord Capital Partners. The fund’s strategy is to identify medium and large-sized companies with the potential to accelerate Rev3 and take stakes in them of 10-30 percent.
“It’s the first time we have a thematic fund on energy transition and the circular economy,” says the fund’s manager, Guillaume Thomé.
“At this stage, there are other financial tools in the region, but more generalist and more dedicated to early-stage businesses.”
Thomé says the fund has so far received close to €40 million in commitments, including €20 million from the European Investment Bank and €12.5 million from the EU’s European Regional Development Fund, as well as a contribution from Crédit Agricole. Targeting €80 million to €100 million, the fund is looking to secure the remainder from institutional investors but, just as importantly, “we want to have interesting stories to tell our shareholders,” Thomé explains.
The fund’s first investment came in December 2016, when Cap 3RI contributed €1.5 million to electromechanical firm Drekan as part of a wider €4 million fundraise. The company will be responsible for repowering a number of wind turbines across the region coming towards the end of their lifecycle. Thomé says further investments are targeted in waste management, biogas and smart buildings.
Separately, the EIB has also invested €110 million in a €430 million project that will help move a fleet of buses from diesel to hybrid engines and another set of buses operating completely on hydrogen.
There have been similar attempts to replicate Rev3 in Rotterdam and Luxembourg, yet Rifkin’s vision is also said to have captured the imagination of Chinese Premier Li Keqiang. That certainly would be a revolution.