Swedish battery developer Northvolt, in collaboration with the German government, has announced its intention to invest several billion euros to build an EV battery gigafactory in Germany.

The facility is set to have the capability of supplying battery cells for around 1 million electric vehicles yearly, as revealed in a joint announcement.

The federal and state governments of Schleswig-Holstein have expressed their intention to provide subsidies for the project in Heide, northern Germany. However, it is essential to note that the approval of the European Commission is required for these subsidies to be granted.

If given the green light, approving these subsidies would represent Germany’s first allocation under the European Union’s Temporary Crisis and Transition Framework.

This framework aims to support eco-friendly industrial projects as part of Europe’s efforts to provide viable alternatives to the subsidies granted by the Inflation Reduction Act in the U.S.

The investment in Heide is set to generate approximately 3,000 direct jobs, and it is anticipated that numerous employment opportunities will also arise in the surrounding industry and service sectors.

Germany’s economy minister, Robert Habeck, voiced his positive outlook regarding an upcoming significant project in the energy and transportation sector.

He highlighted that this project holds great significance and has the potential to generate thousands of employment opportunities in the green technology industry.

Possible expansion in U.S.

Northvolt and the state of Schleswig-Holstein signed a memorandum of understanding in March 2022 to establish a battery plant in the region.

However, the company has expressed the possibility of giving precedence to expanding its operations in the U.S. instead of Europe.

This strategic decision stems from more advantageous subsidies and lower energy costs available in the U.S.

A spokesperson also mentioned that the possibility of building a second plant simultaneously in a different location is under consideration.

According to the spokesperson, the decision to construct a plant in Germany does not rule out the potential of establishing an additional facility in North America.


Northvolt AB is a Swedish battery developer and manufacturer, specialising in lithium-ion technology for electric vehicles. (wikipedia)

European Commission

The European Commission is part of the executive of the European Union , together with the European Council. It operates as a cabinet government, (wikipedia)