During a visit to Sweden, Federal Minister of Economics Habeck continued to promote the construction of a battery plant in Heide in Schleswig-Holstein. It looks good for a long time, then the USA launches a controversial investment program that sows doubts about the decision.

The battery manufacturer Northvolt still sees a lot of need for discussion about the construction of a plant in Heide in Schleswig-Holstein. Northvolt boss Peter Carlsson said at a meeting with Federal Minister of Economics Robert Habeck in Västerås, Sweden, that it was important that there was a long-term energy supply at competitive prices from renewable sources. There are also financing issues. The process is in full swing.

Habeck said they are in good talks with Northvolt. The company has to make the final decision. It’s not just about money alone, but also about infrastructure and personnel. Different pieces of the puzzle have to be put together. “And we’ll try that.” Carlsson said the US Inflation Reduction Act (IRA) — a multi-billion dollar US subsidy program — has created momentum. A year ago, Northvolt said it would build in Europe first and then go to North America. Then the IRA came. This has made it all but impossible to compete in North America unless you build manufacturing and a supply chain. Due to the IRA, there is also very strong pressure from both European and American customers. The demand is constantly increasing.

Habeck visited a Northvolt research laboratory at the end of a two-day trip to Sweden. As an investment volume in Heide up to 4.5 billion euros are under discussion. Thousands of jobs could be created. The shift in the automotive industry away from combustion engines to electric cars is in full swing. The aim of the EU is to make itself more independent with the help of subsidy programs for batteries, especially from Asian suppliers. Volkswagen also holds shares in Northvolt.

Northvolt had already indicated that the construction of the factory in Heide could be delayed. The company cited local electricity prices and higher subsidies in the United States as reasons. Now it was said at Northvolt that the preparations for the factory in Heide are still in progress. Everything will be pushed forward to get started. The question is which project will be prioritized – the one in North America or the one in Heide. Northvolt builds its batteries with renewable energies, so the location in Heide is very suitable because of the large amount of wind power. In Heide, batteries for a million e-cars a year could be produced in the final stage of expansion.

Habeck said on Thursday that Northvolt had looked across Europe for a location and “basically” chose Heide, mainly because of the large amount of renewable energy. The Inflation Reduction Act with the formula that cars have to be produced in the USA if they get the subsidies there opened up this “basic decision” again. Habeck said Northvolt is still open to the Heide location. The decision will be made in the first quarter.

In December, Northvolt’s managing director for Germany, Christofer Haux, confirmed his readiness for the billion-euro project in the economic committee of the Kiel state parliament. “We need this factory for our expansion,” said Haux. “But the general conditions have to be right.” There are challenges with energy prices in Germany.