Northvolt raises €4.6B to expand Europe’s first homegrown battery gigafactory

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Swedish battery maker Northvolt has raised €4.6bn to boost the expansion of Europe’s first homegrown gigafactory and support the company’s battery recycling plans.

Specifically, the capital will help expand cathode production and cell manufacturing at the Northvolt Ett factory in northern Sweden. It will also enable the development of Revolt Ett, the adjacent recycling plant in the final stages of its commissioning and is currently processing its first materials.

The plant recovers battery-grade metals with a 70% lower carbon footprint than mined raw materials, which the startup says marks the first fully integrated, circular battery production setup outside of Asia.

The €4.6bn fundraising represents Europe’s largest green loan to date. This is a type of funding that can only be used for environmental and sustainable projects.

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The deal is non-resource financing, meaning that its repayment will draw from the project’s earnings and not from Northvolt’s own assets. In addition to the European Investment Bank (EIB) and the Nordic Investment Bank, 23 commercial banks have provided the capital. A number of export credit agencies have also covered a portion of the commercial facilities with certain guarantees and direct funding.

With the fresh capital, Northvolt has now secured over €11.9bn in equity and debt to enable its expansion both in Europe and North America. The Swedish unicorn now counts six facilities in total (in Sweden, Germany, Poland, and the US) and recently announced an upcoming one in Canada.

“This financing is a milestone for the European energy transition,” said Peter Carlssom, the company’s co-founder and CEO.

Northvolt key to European battery and EV ambitions

The Swedish manufacturer is key to Europe’s ambitions to establish an EV battery supply chain that can reduce reliance on and compete with the markets in Asia and the US.

In addition, batteries are among the “strategic” technologies of the EU’s Net-Zero Industry Act, which aims to support sectors that are critical for reaching net zero by 2050.

As Europe’s only major battery maker, Northvolt’s position in the ecosystem has been central. The company hasn’t only been supplying European car manufacturers in the likes of Volvo, BMW, and Volkswagen. It’s also been advancing R&D on battery tech (such as sodium-ion battery development) and has been working on a circular economy model that combines production, recycling, and energy storage.


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