Battery making startup Freyr plans belt of Gigafactories
The Norwegian startup Freyr is planning to set up battery cell factories in the gigawatt range. The first plant should be located in Rana, Norway and greater plans for a “Nordic Battery Belt” with at least ten plants are in the pipeline.
Freyr is currently seeking approvals, technology licenses and funding for the first proposed battery cell plant in Norway. According to Bloomberg, Freyr estimates that its first project will cost 40 billion crowns (4.5 billion US dollars).
The company plans to build the first cell factory with a capacity of 32 GWh per year in the Norwegian town of Rana. Freyr intends to acquire rights to existing technology for lithium-ion cells that are suitable for the automotive market, as well as maritime and stationary applications.
At the same time, Freyr plans to build a 600 MW wind farm in addition to sourcing local hydropower, thereby reducing its energy costs by 24 per cent. If everything goes according to plan, production could start in 2023. The cell factory in Rana is only the beginning: Freyr’s vision is to create a “Nordic Battery Belt” with at least ten factories. Another four alone could be built in Norway.
“Our dream would be raw materials coming from Finland, technology from Sweden and renewable power from Norway,” says Freyr boss Torstein Dale Sjotveit, who previously worked for Norsk Hydro.
Freyr still has to overcome a number of hurdles: The municipality of Rana has yet to issue a building permit; in addition, the company is in the process of negotiating with the authorities and reindeer herders for the wind farm on a nearby mountain in the municipalities of Rana and Nesna. Also critical is the acquisition of the required technology and the rights or at least licences to battery technology, which are not yet under contract.
In order to be able to start building the factory, Freyr calculates a capital requirement of 16 to 18 billion crowns – up to two billion US dollars – by the beginning of 2021. As CEO Sjotveit told Bloomberg, between 50 and 70 per cent of the capital will be financed by debt. In addition to several car manufacturers, Freyr hopes to attract Norwegian energy and industrial companies as investors.
The company is currently negotiating with five investors about the next tranche of the starting capital of up to 25 million euros, without naming the potential investors. So far, the company has been financed by an investment of 7.25 million euros from EIT InnoEnergy, an offshoot of the European Institute of Innovation & Technology.
What can be said with absolute certainty is that Europe’s carmakers need more battery factories. Norway, in particular, is the figurehead for a rapid uptake of electric mobility on the European continent. Freyr expects the European demand for battery cells will exceed 300 GWh by 2025, driven by accelerating the electrification of transportation solutions by European car manufacturers (OEM). The Norwegian company intends to build its factories based on 100% renewable energy.
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