Northvolt, a Swedish company, received approval from the European Commission to establish a substantial battery cell factory catering to electric vehicles in northern Germany. This initiative is backed by approximately €700 million ($766 million) in subsidies from the German and Schleswig-Holstein state governments, alongside additional guarantees worth €202 million.

Margrethe Vestager, the EU commissioner overseeing competition, highlighted that this aid, totaling €902 million, marks the first approved instance aimed at preventing an investment from relocating outside Europe, subject to European Commission endorsement under state aid regulations. Northvolt is exploring possibilities in the United States and Canada as well.

German Economy Minister Robert Habeck expressed immense satisfaction, stating, “I am very, very pleased that this is happening today.”

Northvolt’s blueprint involves producing battery cells for electric vehicles at a Heide-based factory by 2026, entailing a €4.5 billion investment projected to generate 3,000 jobs. Sources close to the company note an approximate €100 million investment in the ongoing construction.

This endeavor stands as Schleswig-Holstein’s most significant industrial project in decades. Northvolt has consistently highlighted Heide’s west coast advantages, notably the substantial wind power, both on land and at sea, which the factory relies on extensively.

The German government commits around €564 million, with the regional state contributing up to €137 million in funding, distributed across multiple annual installments.