Millions in funding for Northvolt
Battery cell factory in Schleswig-Holstein can come
January 8, 2024, 2:21 p.m
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Battery cells for electric cars can be produced in the Dithmarschen district from 2026. According to an EU decision, the federal and state governments are allowed to support the factory construction of the Swedish Northvolt group with hundreds of millions of euros. Otherwise it might have been built first in another country.
As planned, the Swedish company Northvolt is allowed to build a large battery cell factory for electric cars in Schleswig-Holstein near Heide. The EU Commission has now approved the proposed funding for the billion-dollar project, as the Brussels authority announced. “This €902 million measure is the first individual aid approved to prevent an investment from moving outside Europe,” said EU Competition Commissioner Margrethe Vestager.
Federal Economics Minister Robert Habeck emphasized: “I am very, very happy that this is happening today.” Northvolt wants to produce battery cells for electric cars in a factory in the Dithmarschen district from 2026. The 4.5 billion euro investment is expected to create 3,000 jobs. The company has already invested around 100 million euros of its own funds in the construction project in Heide, according to people close to the project.
The federal and state governments are funding the project with around 700 million euros. There are also guarantees for a further 202 million euros. Of the funding, around 564 million euros go to the federal government and up to 137 million euros to the state. The funding is spread over several annual tranches.
Largest industrial project in decades
The federal government released a funding decision in December. It was subject to state aid approval from the EU Commission. The project will be the largest industrial project in Schleswig-Holstein in decades. Northvolt had always emphasized the locational advantages of the west coast. A lot of wind power is generated there on land and at sea – which the factory needs in large quantities.
Northvolt boss Peter Carlsson had meanwhile signaled that construction in Heide could be delayed. He cited the comparatively high electricity prices in Germany and higher subsidies in the USA as reasons. The company could therefore initially locate there. Northvolt was also looking into tackling two construction projects. In addition to Heide, locations in the USA and Canada are available.