Northvolt gets 902 million euro German subsidy to build a battery factory

Germany has approved a 902 million euro subsidy for Swedish battery maker Northvolt to build a factory. This new announcement from Brussels came after Northvolt received an alluring offer from the Biden administration to set up a plant in the U.S. with a $783 billion state subsidy.

However, Northvolt returned to the table with German officials after the government was allowed to increase state subsidies to companies to match the subsidies offered outside of the EU.

Such action also allows the EU states to capture a strategy important to protect from slipping out of the hands. In a turn of events, the new 902 million euro subsidy received approval from the European Commission.

EU’s competition commissioner Margrethe Vestager said that the new 902 million German measure is the first individual aid being approved to prevent “an investment from being diverted away from Europe”.

Northvolt Battery Plant

This subsidy fund consists of a 700 million euro grant and a 202 million euro guarantee.

On the other hand, Robert Habeck, Germany’s Economy Minister said the agreement was vital to European competitiveness.

On a further note, Habeck mentioned that Germany needs a more robust industry for new sectors including semiconductors, batteries, electrolyzers, hydrogen, and more.

This new planned factory could produce 1 million electric vehicles a year based on the size of the battery. Furthermore, the plant is expected to reach full production capacity by 2029.

Germany is the center of the entire European economy and bringing more investment to the country and manufacturing would improve the technology access to the entire bloc.

Meanwhile, a formal announcement about the plant is yet to be made by Northvolt.

(Source – Euronews)