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Northvolt announced the signing of a $5 billion non-recourse project financing to expand Northvolt Ett in northern Sweden, the company writes in a press release. The deal represents the largest green loan raised in Europe to date.

Why I need to know this:

Northvolt secured a $5 billion non-recourse project financing for the expansion of Northvolt Ett. This is the largest green loan raised in Europe to date. The financing will not only support the expansion of cathode production and cell manufacturing but also contribute to the development of a circular battery production setup, marking a milestone in sustainable business practices in the European energy transition. European investing company EIT InnoEnergy was one of Northvolt’s initial funders.

In addition to the expansion of Northvolt Ett’s cathode production and cell manufacturing, the finance package will enable the expansion of the adjacent recycling plant, Revolt Ett, which is approaching the conclusion of its commissioning and is processing its first materials. The facility recovers battery-grade metals with a carbon footprint that is seventy percent lower than mined raw materials, thereby enabling a fully integrated, circular battery production setup that has not previously existed outside of Asia.

Peter Carlsson, co-founder and CEO of Northvolt, commented: “This financing is a milestone for the European energy transition. It will enable us to realize the full potential of Northvolt Ett and demonstrates that circular, sustainable business practices are fundamental to success in today’s industry.”

The world’s greenest battery

This is the first loan raised through Northvolt’s Green Finance Framework, created in 2023. Reflecting the company’s commitment to sustainability and the circular economy, Northvolt received the highest ‘dark green’ rating attainable for its framework from the external rating company CICERO — the first industrial actor in its sector to do so.

Emma Nehrenheim, Chief Environmental Officer at Northvolt, commented: “I’m proud to see how our ambition to mass produce the world’s greenest battery attracts top-tier financial partners, as global capital is looking to invest in electrification and climate change mitigation. It has become obvious that creating a new industry standard attracts world-leading talent and major financial institutions that aim to align their strategy with long-term macro trends.”

This financing package means that Northvolt has secured more than $13 billion in equity and debt to expand in Europe and North America. European investing company EIT InnoEnergy was one of Northvolt’s initial funders.