The UK government has confirmed over £1.1bn (€1.16bn, $1.2bn) of funding for a second battery gigafactory alongside the Nissan car plant in Sunderland.
However the funding comes as Nissan is slashing 20,000 jobs and cutting its car plants from 17 to 10. This has echoes of the fiasco with the neighbouring BritishVolt battery gigafactory where funding did not arrive in time, as the plant, being built by Japanese battery maker Envision AESC was covered by eeNews Europe back in June 2021.
The 12GWh plant will supply batteries for up to 100,000 vehicles a year. This represents a six fold increase in UK electric vehicle battery production in the UK. Work started in December and the company expects production to start this year.
- AESC is also building a second battery gigafactory in France to supply Nissan’s partner Renault
- Live by politics, die by politics
For the UK gigafactory, the UK National Wealth Fund and UK Export Finance will provide financial guarantees which unlock £680 million in financing from banks including Standard Chartered, HSBC, SMBC Group, Societe Generale and BBVA. This will cover construction and operation of the new plant. The remaining £320 million has been secured through private financing in addition to new equity provided by AESC.
In addition to this £1 billion investment, the Government’s Automotive Transformation Fund is also investing £150 million in grant funding.
“This investment marks a key milestone in AESC’s ongoing efforts to support the UK’s path towards decarbonisation and the expansion of its EV market,” said Shoichi Matsumoto, CEO of Japanese headquartered AESC. “Through close collaboration with strategic partners, we strive to accelerate this transition while creating high-quality local jobs and building resilient, sustainable supply chain.”
“AESC’s gigafactory will not only help to retool our car industry for net zero it will also support jobs, growth, and prosperity in the Northeast,” said John Flint, CEO of the National Wealth Fund.
“This investment further demonstrates the significant role NWF is playing to crowd private capital into the industries and regions where its most needed, boosting government’s growth and clean energy missions.”
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