In fact, the matter was almost decided. In Schleswig-Holstein, the Swedish Northvolt is building a huge production facility for battery cells for electric cars. An investment in the billions that would create numerous jobs in this region. After some hesitation, implementation of the original plans seems more likely.
Who pays which subsidies?
Northvolt had made the construction dependent on subsidies, among other things. In the middle of the planning was the US government’s Inflation Reduction Act, which supports the settlement of such industrial projects with billions in subsidies. Now the EU wants to promote industrial production in a similar way. Funding based on the “Temporary Crisis and Transition Framework” (TCTF) is being prepared for this purpose. This is the framework under state aid law that the EU states can use when designing their support measures.
If the EU Commission approves the financing, the TCTF will be applied in Germany for the first time. The federal government and the EU Commission are in initial constructive talks, it said. “With the new TCTF, the EU Commission has opened up a clear path to securing important industrial investments in Europe in green key technologies,” commented Federal Minister of Economics Robert Habeck on the plans.
3000 jobs directly, more in the area
In this case, the subsidy is still subject to approval by the EU Commission, according to the Federal Ministry of Economics, the state government and Northvolt. “In the case of Northvolt, the grant will unlock multi-billion dollar private investment that will create 3,000 direct jobs in Heide and thousands more in the surrounding industry and service sectors,” the statement said. The aim is for the first battery cells to leave the factory in Heide, about 100 km northwest of Hamburg, in 2026.
60 GWh annually
The production volume after the factory is ramped up should be 60 GWh per year and supply around one million electric vehicles with battery cells. “We are grateful for all the efforts that have been made so far by the federal government, the Schleswig-Holstein state government, the EU Commission and locally in Dithmarschen,” said Northvolt boss Peter Carlsson. “With this commitment from the federal government behind us, Northvolt has decided to take the next steps for the expansion in Heide.”
One obstacle: high electricity prices
Carlosson had signaled some time ago that construction in Schleswig-Holstein could be delayed. He cited the comparatively high electricity prices in Germany and higher subsidies in the USA as reasons. The company could therefore settle there first. Around 4.5 billion euros were mentioned as an investment volume for Heide.
According to information from the dpa, Northvolt is now considering tackling two construction projects. In addition to Heide, there are locations in the USA and Canada to choose from. Above all, Northvolt now wants to push ahead with the preparations for construction in Schleswig-Holstein and obtain the final building permit. According to the announcement, all those involved are striving to meet these requirements this year so that construction work can begin. Northvolt had emphasized the locational advantages of the North Sea coast. A lot of wind power is generated there on land and at sea, which the factory needs in large quantities.