May 16 (Renewables Now) - The European Investment Bank (EIB) today said it has given in-principle approval to a loan of EUR 350 million (USD 392.3m) to back Northvolt AB’s plan for a lithium-ion battery cell “gigafactory” in Sweden.
The manufacturing facility will be built in Skelleftea municipality, northern Sweden, in a region that will allow the battery maker to use 100% renewables-generated power for the production processes. Called Northvolt Ett, the plant will be Northvolt’s primary production base. When operating at full capacity, the facility will be able to produce 32 GWh of batteries annually, to be used in automotive, grid storage, and industrial and portable applications.
Northvolt will implement a capital raise that together with the EIB loan will fund the first 16-GWh phase of the project. After the EIB loan agreement is signed, the European Fund for Strategic Investments (EFSI) will contribute to the project financing, as well, the EIB said.
Completion of the first quarter of the factory is planned for 2020.
This loan represents the EIB’s largest direct financing for energy storage, said EIB vice president Andrew McDowell, adding that the bank will work with Northvolt in the coming months to finalise contracts.
(EUR 1.0 = USD 1.121)