UK’s First Gigafactory Ready for Huge Expansion
The Chinese company behind the UK’s only gigafactory is planning a huge expansion of the project and is looking to create its battery division for electric vehicles as it expands its European business.
Zhang Lei, managing director of Envision, said the annual capacity of the Sunderland facility will eventually reach 38 gigawatt hours, allowing the site to produce batteries for hundreds of thousands of additional electric cars each year.
The plans would mark a big increase from the 1.7 GWh capacity of a smaller existing plant and 11 GWh when the new plant at the site opens.
Production of the first phase of the Sunderland plant extension is expected to start in 2024 as part of a partnership with Nissan UK.
Envision’s $ 2.4 billion gigafactory in Douai, France, in partnership with Renault, is also expected to open in 2024.
Zhang said the company is in talks with global automakers to supply batteries from the two sites. Envision also has battery factories in Japan, the United States and China.
“The electric car has become the starting point of the green industrial revolution,” he told the Financial Times.
He added that the Shanghai-based company, which is China’s largest wind turbine maker, would “definitely” list its global battery business. “It could be soon,” he said. “It all depends on the decision of the board of directors. We have a very international board of directors.
Chinese battery makers are expanding rapidly in Europe, as the continent’s biggest automakers pledge to spend billions to switch their fleets to electric cars. CATL, the world’s largest battery manufacturer, along with Chinese groups SVolt Energy and Guoxuan, all build battery factories in Germany.
CATL shares have risen 68% this year, valuing the company at 1.38 billion Rmb ($ 216 billion), as investors bet on the global transition to fossil fuels.
The existing Sunderland plant, which manufactures batteries for the Nissan Leaf, was acquired by Envision Group when it acquired Nissan’s battery business, AESC, in 2019. The new plant will be powered entirely by renewable energy.
Zhang said the company is looking for locations for new giga factories in Europe and is considering investing in battery materials such as lithium to secure supplies.
“We’re planning this – we’re talking to a few companies,” he said.
Zhang added that securing renewable energy supplies was essential for the production of batteries at lower cost. Envision is building a 20 GWh battery plant in a “net zero” industrial park in Ordos, Inner Mongolia, one of China’s largest coal-producing provinces.
The company is committed to being carbon neutral in all of its operations by the end of 2022 and in its supply chain by 2028.
“If you can use cheaper green energy, you can secure your energy cost for the next 20 years with lower prices than fossil fuels,” he said.
The Ordos plant will supply electric trucks built by the Chinese group FAW and will store renewable electricity in Inner Mongolia.
Zhang said China needs to move manufacturing close to places rich in renewable energy.
“This is my solution to China’s energy crisis,” he said. “Let’s provide more renewable energy – the current [energy] the shortage is not the fault of renewable energies. This is the opportunity to inject more renewable energy.