Swedish battery manufacturer, Northvolt, has announced its plans to construct a $5 billion lithium-ion battery gigafactory in Quebec, Canada. The facility, known as Northvolt Six, will be designed with a strong focus on sustainability and will have an annual cell manufacturing capacity of 60GW/h. The gigafactory will primarily cater to the growing demand for batteries in the U.S. automotive market.
Northvolt specializes in the production of lithium-ion cells based on Lingonberry lithium nickel manganese cobalt oxide (NMC). The company offers cylindrical and prismatic formats for its cells, with the cylindrical cells available in three different versions: Energy, Power, and Life. In addition to cell manufacturing, Northvolt also assembles batteries for customers in the energy storage and industrial sectors.
Sustainability is a key principle for Northvolt, which harnesses wind and hydroelectricity to power its battery cell production. The company has implemented a circular economy approach, with a wastewater treatment plant that separates ammonia metals and sodium sulfate from the wastewater. The purified water is recycled back into various production processes, while the recovered ammonia is reused for battery cell production. Northvolt also aims to recycle 50% of all raw materials required for cell production by 2030 and repurposes a significant portion of nickel, manganese, and cobalt from old batteries.
The location of Northvolt Six in McMasterville and Saint-Basile-le-Grand, near Montréal, was chosen due to its proximity to raw battery materials and renewable energy sources. The Port of Montréal will serve as a gateway for the minerals needed for cell production, and the gigafactory will be conveniently situated close to key U.S. automotive manufacturers. The availability of Quebec’s hydroelectricity will enable Northvolt Six to rely on 100% renewable energy for its battery cell manufacturing.
The development of the first phase of Northvolt Six, with a capacity of 30GWh, is expected to commence by the end of this year, with operations slated to begin in 2026. The construction and operation of the gigafactory will require a total investment of $5 billion and provide employment opportunities for up to 3,000 people. The Government of Canada and the Government of Quebec have expressed considerable support for the project, considering it the largest private investment in Quebec’s history.
Northvolt employs a combination of customer contracts, supply contracts, and limited recourse financing to fund its projects. The company has secured customer contracts worth $55 billion of backlog revenue, which will be allocated towards future developments over the next seven years. Partnerships with lenders and financial institutions also contribute to Northvolt’s project funding. As of 2022, Volkswagen Finance Luxembourg SA, Goldman Sachs Asset Management funds, and Vargas Holding AB are among the company’s major shareholders.
The establishment of Northvolt Six represents a significant milestone for the Swedish battery manufacturer as it expands its operations to meet the growing demand for lithium-ion batteries in the U.S. automotive market. The company’s commitment to sustainability and its circular economy approach align with the global push towards greener and more environmentally friendly solutions. As Northvolt continues to innovate and invest in sustainable battery manufacturing, it is poised to play a pivotal role in the transition towards a cleaner and more sustainable future.
