Electric battery start-up Britishvolt is pushing ahead with plans for a gigafactory in Northumberland after securing £1.7bn (€2.0bn) in funding.

Construction of the facility will start in April and it’s expected to be operational by 2024

Construction of the facility will start in April and it’s expected to be operational by 2024. Once complete, the factory will produce enough batteries for over 300,000 electric vehicles each year; equivalent to around 25% of current UK vehicle manufacturing.

This will support government plans to make the UK automotive industry a leader in electric vehicles and comes after a report published by the SMMT last year called for a binding target on battery capacity to support British automakers.

The gigafactory, which will be located in Blyth, will also create 3,000 direct jobs and another 5,000 indirect jobs in the wider supply chain.

The £1.7bn funding has been secured from Tritax and Abrdn, which will fund the build of the project, shell and core, as well as develop the associated supplier park.

The funding was enabled after the Government pledged support for the project through its Automotive Transformation Fund, delivered by the Advanced Propulsion Centre and used as a mechanism to deliver the Government’s 10-point plan for a green industrial revolution and its recent Transport Decarbonisation Plan.

The level of government funding hasn’t been revealed but is believed to be around £100m according to reports.

Business Secretary Kwasi Kwarteng said: “Today’s news is a major boost for Britain and a resounding vote of confidence in the north east economy.

“Britishvolt’s planned gigafactory will not only enable the UK to fully capture the benefits of a booming electric vehicle market, but will bring thousands of highly skilled, well-paid jobs to the North East.

“In this global race between countries to secure vital battery production, this government is proud to make the investment necessary to ensure UK’s retains its place as one of the best locations in the world for auto manufacturing.”

Britishvolt said further follow-up announcements will be made in the coming weeks, including customer MoUs and R&D collaborations, relationships with blue chip UK automotive sports car brands and technology information.

Peter Rolton, Britishvolt executive chairman, commented: “This announcement is a major step in putting the UK at the forefront of the global energy transition, unlocking huge private sector investment that will develop the technology and skills required for Britain to play its part in the next industrial revolution.”

An “incredibly positive moment for the EV market”

Meryem Brassington, electrification propositions lead at Lex Autolease, said of the news: “Today’s announcement of the Government’s funding for the new EV battery plant in Northumberland is an incredibly positive moment for the EV market, highlighting the UK’s continued commitment towards a green economy. The rise of EV registrations is now at a UK high, however there is a real risk of demand outstripping supply creating a barrier to those wanting to make the transition. This strong signal of intent from the Government should provide comfort to the automotive industry and ensure the long-term supply of EV batteries across the country.

“That said, this is just one step in ensuring a green transition for the industry and country as a whole. If we are to achieve our ambitions, the Government cannot take their foot off the pedal and must continue to support the automotive industry to drive EV uptake on a mass-market scale.”

And Fiona Howarth, CEO of Octopus Electric Vehicles, said: “We cannot underplay the significance of Britishvolt’s news this morning, and how huge this is for UK EVs. If we are to keep up with the demand landslide we’re seeing for EVs, steps like this to help smooth out supply chain issues will help us provide even more cars to Brits looking to make the switch. It is also brilliant to see the Government reaffirming their commitment to clean transport and the broader UK auto sector. The momentum is only swinging one way and 2022 will be the year that really puts electric vehicles in pole position.”