Sweden tools up against the US and Asia with its own Gigafactory
Just south of the arctic circle is not where you’d expect to find a battery factory as large as 71 football fields. Lying 125 miles south of the arctic circle and surrounded by forests of looming pine trees, the gigafactory looks decidedly out of place.
The term Gigafactory was coined by Elon Musk to describe his first high-output battery facility in the Nevada desert.
The Swedish factory is being developed by Northvolt, a startup venture co-founded by two former Tesla executives. This is about as far removed from the searing heat of the Nevada desert as you can get.
However, it is from this factory and a base in Västerås, on the outskirts of Stockholm, that Northvolt is intending to supply 25% of Europe’s electric batteries. The intention is to capitalize on the switch from carbon fuel-powered vehicles to electric vehicles. Swedish car giant Volvo has already announced its plan to produce only electric vehicles from 2030.
Northvolt recently announced that it had raised a further $2.75 billion in funding to pay for the expansion.
Preparing for the battery boom
According to the investment bank UBS, 40% of all new car sales will be electric vehicles by 2030, and by 2040 the figure will be almost 100%.
The plant’s manager, Fredrik Hedlund, said recently – “If you look at the agenda for all the automotive manufacturers to actually make those electric cars, the amount of cells that you’ll need to access, is going to be humongous.”
Mr. Hedlund is also confident that despite a huge amount of work still to be done, the factory will begin production by the end of the year. In its first phase, it will manufacture enough batteries for 300,000 cars annually, but it has the potential to ramp production up to produce enough batteries to power 1 million vehicles.
Northvolt has already secured a contract with german car giant Volkswagen to produce its batteries for the next decade. It is also planning to establish a long-term partnership with Swedish bus and truck manufacturer Scania.
Speaking to the BBC Mr. Hedlund said – “We are building a totally new industry that hasn’t really existed, especially in Europe, at this scale. I think, not only myself but a lot of people, think that this is the coolest project in Europe right now.”
Environmental concerns are driving the move to electrification and the Swedish gigafactory is utilizing hydroelectric energy from the nearby Skellefte River to ensure that its production techniques are as eco-friendly as the product.
The factory is at the forefront of a wider effort in Europe to cash in on the move to electric vehicles. The market is currently dominated by Asian companies and US-based Tesla. But now, Norwegian energy firm Freyr is planning its own Gigafactory, and German companies Daimler and BMZ already have factories up and running.
A French startup, Verkor, is planning a Gigafactory in Toulouse.
With Nothvolt’s presence giving the town of Västerås a feel akin to a “boom town” there is talk of the race to electrification being the new oil rush.