Swedish start-up company Northvolt will build a first-of-a-kind battery cells manufacturing line for use in the automotive, stationary energy storage and industrial sectors in Västerås, Sweden, thanks to an up to €52.5 million loan from the InnovFin Energy Demonstration Projects (EDP) facility - funded under Horizon 2020, the EU research and innovation programme.
The project will help Europe get into the top league of lithium-ion battery cells manufacturers by implementing cost‑saving technological process innovations, which would ultimately make large-scale European production commercially competitive. This is a key step in implementing the EU Strategic Energy Technology Plan and in particular its Flagship action on eco-efficient production, which aims to establish a competitive advanced battery manufacturing base in Europe.
Carlos Moedas, European Commissioner for Research, Science and Innovation, Andrew McDowell, Vice-President of the European Investment Bank (EIB), and Northvolt CEO Peter Carlsson signed the Memorandum of Understanding on this finance operation today at the 2018 Industry Days in Brussels with participation of EC Vice-President Maroš Šefčovič.
Commissioner Moedas said:
I am happy to see EU loans enabling real market-creating innovation. With 40% of all patents for renewable technologies belonging to European companies, the EU is undoubtedly leading the fight against climate change. But many of Europe's great innovations in clean energy technologies end up being produced elsewhere, meaning that others make much more money out of European innovations than we do. Today's decision will help to correct this.
Building on the current project, which is expected to employ up to 400 people and prove the commercial viability of Northvolt's innovative manufacturing processes, the company plans to set up an 8 GWh manufacturing block by early 2020 for an investment of up to €1.5 billion. By 2020-2023, the company plans to scale up to 32 GWh representing an investment of approximately €4 billion. This facility will be the largest of its kind in Europe.
By using clean hydro power and a highly energy efficient production process, Northvolt’s batteries will have 64% less carbon footprint compared to other global competitors, including CO2 emissions from mining and refining processes. Eventually, Northvolt aims to achieve zero-carbon footprint. The company will also build recycling capabilities to create a fully circular business model. No other cell manufacturer is doing this so far.
Northvolt is the fourth strategic project funded by the EDP facility. The previous deals were a €10 million loan in July 2016 to build a full-scale demonstration unit to convert wave energy into electrical power (WaveRoller, Portugal); a €30 million loan to help finance an innovative gasification plant converting wood residues and commercial and industrial waste into electricity and heat (CHO TIPER, France); and a €15 million loan to set up a manufacturing demo line for a new and highly-efficient photovoltaic technology (Oxford PV, Germany).
The European Commission and the EIB launched in June 2015 the ‘InnovFin Energy Demonstration Projects’ (InnovFin EDP) facility to support the implementation of the EU's Strategic Energy Technology Plan. The objective is to strengthen EU's leadership in renewable energy and climate policy by helping to roll-out the next generation of low‑carbon energy technologies. The facility provides loans or quasi-equity to first-of-a-kind commercial-scale demonstration projects in the fields of renewable energy, energy storage, smart grids, and carbon capture utilisation and storage. These innovative projects are inherently risky and require public support in a stage where access to finance is particularly difficult. InnovFin EDP facilitates access to risk finance as prompted by the Accelerating Clean Energy Innovation Communication and the European Innovation Council.
23 February 2018