The European Bank for Reconstruction and Development is lending €250 million for a project which has expanded from producing an initial 100,000 EV batteries per year to an hoped-for 1 million by 2022, creating 1,000 new jobs along the way.
As far as European electric vehicle (EV) battery manufacturing is concerned, the European Bank for Reconstruction and Development (EBRD) “is up for it”. At least, that is the verdict of a press statement made by the lender yesterday to announce it will contribute a €250 million loan towards the cost of expanding LG Chem’s EV battery gigafactory in Poland.
The South Korean chemicals giant last year opened what the EBRD claimed is Europe’s only facility for producing electrodes, cells, modules and final battery packs.
According a report by Reuters in October 2017, LG Chem at that point was planning to invest PLN5.9 billion (€1.38 billion) in a facility able to manufacture 100,000 EV batteries per year in Wroclaw.
London-based business news website Argus reported 13 months later the factory owner had sanctioned further investment of $571 million (€517 million) – on top of the original $350 million cost of the fab – to expand annual production capacity from the 100,000 already achieved to as much as 300,000 batteries after signing a supply deal with Volkswagen in October last year. That expansion plan, according to Argus, was intended to run from December until April 2021.
The statement from the EBRD mentioned an estimated final bill of €2.8 billion for the Wroclaw facility, with development of the fab planned in three phases towards an aim of having a 65-70 GWh annual production capacity in 2022. If achieved, that would enable the Polish factory to produce 1 million lithium-ion EV batteries per year, enough to supply 6% of all types of car sold in the EU annually.
“We are proud to support this landmark investment, which will lead the green transformation of Europe’s automotive sector,” said EBRD global head of industries Frederic Lucenet in yesterday’s statement. “In all its industrial projects across all 38 economies in which the EBRD invests, the bank is investing in … the decarbonization of the hard-to-abate sectors [of the economy]. Becoming part of LG Chem’s ambitious venture in Poland illustrates that the EBRD is up for it.”
The EU lender also stated 1,000 new jobs would be created in Poland up to 2022 as a result of the latest expansion plans.