Northvolt, a company founded by two former Tesla executives who broke out on their own to build a battery gigafactory in Europe, seems to be in motion.
After receiving backing from VW’s Scania last month, Northvolt has now secured a $68 million loan to build a demonstration battery line for its own battery factory.
The company announced today that the Board of Directors of the European Investment Bank (EIB) has approved a EUR 52.5 million loan backed by InnovFin – EU Finance for Innovators’ Energy Demonstration Projects facility.
With the EU’s support, Northvolt now plans to begin construction of its demonstration line in the coming months.
Peter Carlsson, CEO of Northvolt, commented on the announcement:
“Europe is moving rapidly towards electrification. Northvolt’s objective is to build the world’s greenest battery to enable the transition. With the support from the European Investment Bank and the European Union, we are now one step closer to establishing a competitive European battery manufacturing value chain.”
The company plans to use its demonstration line to showcase its capabilities and finance its plans for a larger battery factory.
The factory is expected to start production in 2020 with a target capacity of 8 GWh per year and they will aim for 32 GWh of capacity once the entire factory will be completed in 2023.
It would make it the biggest li-ion battery factory in Europe and comparable in size to the first phase of Tesla’s Gigafactory 1 in Nevada. Peter Carlsson, Founder and CEO of Northvolt, and Paolo Cerruti, COO of Nortvolt, both worked on Gigafactory 1.
This is probably the most significant step forward for the project to date.
Battery manufacturing is an extremely capital-intensive business and a $68 million cash infusion could make a big difference.
If they can use that cash to build an efficient pilot plant, then they shouldn’t have too much difficulty raising more money for the actual factory.