Northvolt decides that Skellefteå and Västerås will be the Swedish municipalities for building its battery factory.

Northvolt, a Sweden-based startup initiated by Swedish entrepreneur Peter Carlsson, announced a partnership with the two Swedish municipalities Skellefteå and Västerås for the establishment of its lithium-ion battery manufacturing.

Northvolt wants to build a next generation battery factory focused on process innovation, scale and vertical integration. The objective is to build the world’s greenest battery, with a minimal carbon footprint and the highest ambitions for recycling, to enable the European transition to renewable energy.

After conducting in-depth assessments of eight Swedish and two Finnish municipalities, Northvolt proceeded with Västerås and Skellefteå to perform a closer assessment, including environmental studies and consultations.

After carefully studying both municipalities, it became evident that a split operational setup, with the factory located in Skellefteå and main R&D operations located in Västerås, is the optimal solution.

Skellefteå is part of a raw material and mining cluster in the north of Sweden and has a long history of process manufacturing and recycling. Skellefteå will be the location of Northvolt’s first large-scale lithium-ion battery factory and will serve as the main production site, which includes active material preparation, cell assembly, recycling and auxiliaries. The factory will employ 2,000-2,500 people.

Västerås has a strong standing within energy and electrification. It is home to several multinational companies, including ABB, with world class engineering and R&D competence in electrification and process optimization. Northvolt will establish its R&D facility in Västerås, including a demonstration line which will be used to qualify and industrialize products and processes. The Västerås operations will employ 300-400 people.

The construction of Northvolt’s factory is scheduled to begin during the second half of 2018. Once the first quarter is completed in 2020, it will produce 8 GWh worth of battery capacity per year. The full factory, which will be completed in 2023, will produce 32 GWh per year. The construction of the demonstration line in Västerås will begin inn 2018 and is scheduled to be completed in 2019.

Northvolt raised about $25M from outside investors, including ABB and angels Dan Sten Olsson and Harald Mix, and will be looking for about $500M in funding to put legs for his business.