Northvolt-VW announces German gigafactory plan as battery maker signs first ESS contract

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Schema for the initial 220kW EV charge buffer / peak shaving project in Sweden. Image: Northvolt.

Northvolt, the start-up aiming to manufacture lithium-ion batteries on a massive scale in Europe sustainably, has signed a contract to deliver its own first commercial energy storage system (ESS) project and revealed news on a second planned 'gigafactory' in Germany.

The company emailed Energy-Storage.news to draw attention to the fact that, while there has been much discussion of Northvolt's Masterplan, which includes the capacity to make 32GWh of battery packs each year including cells in Sweden, it's perhaps less well known that the company intends to use those battery cells and racks to assemble systems.

“Many people imagine Northvolt simply to be a cell manufacturer, but with an in-house battery system [of our own], we're actually positioning to deliver complete solutions,” Northvolt's president for energy solutions, Emad Zand, told Energy-Storage.news.

A contract has been signed to deliver an ESS which will “support peak shaving at an EV charging station,” Zand said, in the city of Vasteras, Sweden, for Mälarenergi, a municipally-owned electricity and heating company. The system initially deployed will be relatively small, at 220kW peak power output and 320kWh of storage capacity. It will use Northvolt's branded battery rack, called Voltrack.

A company press release said the system will reduce the charging solution's draw from the grid at peak times – the most expensive and often most polluting energy on the grid – by as much as 80%, lessening the impact of EV charging on the local grid. The project is expected to go into operation in summer 2020.

Artist rendering of the planned Northvolt Ett site in northern Sweden, with a further R&D and office headquarters being built further south in the country. Image: Northvolt.

Further gigafactory announced for Germany

Initiated by a former Tesla executive who then went through an extensive headhunting process to source talent from Asia's battery industry and Silicon Valley's tech and software space, Northvolt has attracted investment from partners that include Goldman Sachs and a number of big automakers.

Northvolt will begin with Northvolt Ett in Skeleftea, Sweden, 'Ett' being 'One' in the Swedish language. Just announced today: a Northvolt-Volkswagen joint venture (JV) is to establish another vast production facility in Salzgitter, Lower Saxony, Germany. Called Northvolt Zwei, the 50-50 JV between VW and Northvolt intend to begin construction in 2021.

When production begins, sometime in late 2023 or early the following year, the facility will produce 16GWh of batteries, primarily aimed at the electric vehicle and mobility market. Northvolt touts its ambition to make batteries with minimal environmental impact, including carbon footprint at each of its gigafactories.

Meanwhile, Tesla has recently said it will build a gigafactory plant in Berlin. Germany-headquartered ESS manufacturer and integrator Tesvolt has also begun building a gigawatt-scale facility for assembling systems in its home country, which could be Germany's first plant of that scale – albeit considerably smaller than either Tesla or Northvolt's at just over 1GWh of annual production capacity. 

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