APG invests in sustainable batteries for electric cars

APG invests in sustainable batteries for electric cars

Published on: 3 September 2020

Over € 2.5 billion – that is how much the Swedish company Northvolt has collected for research and development and the construction of two gigafactories for sustainable lithium-ion batteries for electric cars. € 1.35 billion of that was recently received from a group of international financial institutions. APG also participated in that financing round – on behalf of their client ABP. Peter Carlsson, CEO of Northvolt:  “The momentum for electric cars is stronger than ever.”

 

Northvolt was founded by two former Tesla managers in 2016, in order to contribute to the transition to clean energy in Europe. With the € 1.35 billion that Northvolt recently collected – in loans – the company wants to build two gigafactories for sustainable lithium-ion batteries: one in Sweden (“Northvolt Ett”) and one in Germany (“Northvolt Zwei”).

 

BMW

Lithium-ion batteries are used in electric cars and play an important role in the transitions from fossil fuels to sustainable energy. Northvolt is the biggest manufacturer of this type of battery in Europe. Northvolt already has a deal with BMW for the batteries that Northvolt Ett will produce. The German car manufacturer will be buying as much as € 2 billion worth of batteries from 2024 on. This will make Northvolt the third biggest supplier to BMW, after the South-Korean Samsung SDI and the Chinese CATL.

The momentum for electric cars is stronger than ever, says Peter Carlsson, co-founder and CEO of Northvolt. “Our clients need large amounts of high-quality batteries with a low CO2 footprint. Europe has to build its own production facilities for this.”


Political pressure

Carlsson is referring to the increasing political pressure the German car manufacturers are under to safeguard their battery supply by attracting suppliers from the European Union too. The European Investment Bank (EIB) has already provided a €350-million loan to Northvolt Ett for this purpose. Previously, the EIB had already supported Northvolt Labs, which produced the first battery cells, which created the foundation for the gigafactory.

 

Start in 2021

Northvolt Ett will be built in Skellefteå, in northern Sweden and will run completely on renewable energy. The factory will start production in 2021 and is expected to provide 40 gigawatt hours (GWh) of energy a year. This will power approximately 15,000 electrical cars for a year. Northvolt Zwei in Germany will be built in collaboration with car manufacturer Volkswagen. This factory, which is expected to supply 20 GWh a year, will start production in 2024.

 

The investment in Northvolt fits in with two long-term trends that ABP wants to take advantage of with its sustainable and responsible investment policy: the transition to sustainable energy and responsible use of raw materials by recycling and other means.

 

 

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Responsible investing

Collection in Sustainability, Long-term investment