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    VERKOR EV BATTERY GIGAFACTORY

    French gigafactory for electric vehicle batteries

    Startup Verkor is building a gigafactory in Dunkirk to mass-produce battery cells for 300 000 electric cars each year

    Status
    First signature
    Signed
    23/07/2024
    Amount
    EUR 313,097,509.75
    Countries
    France
    Sector(s)
    Industry
    See more

    Signature(s)

    Amount
    € 313,097,509.75
    Countries
    Sector(s)
    France : € 313,097,509.75
    Industry : € 313,097,509.75
    Signature date(s)
    23/07/2024 : € 43,097,509.75
    21/03/2024 : € 270,000,000
    Link to source

    Summary sheet

    Release date
    24 November 2022
    Status
    Reference
    Signed | 21/03/2024
    20220713
    Project name
    Promoter - financial intermediary
    VERKOR EV BATTERY GIGAFACTORY
    VERKOR SAS
    Proposed EIB finance (Approximate amount)
    Total cost (Approximate amount)
    EUR 600 million
    EUR 1941 million
    Location
    Sector(s)
    Description
    Objectives

    The project concerns the design, construction and operation of a 16 GWh electric vehicles battery cell manufacturing plant in Dunkirk.

    The production of advanced high-tech lithium-ion electrodes and battery cells will contribute to develop a European battery industry. The aim is to cater for the transition to e-mobility by supplying the growing demand in the EU for Battery Electric Vehicles with cutting-edge battery cells.

    Additionality and Impact

    The Project is eligible under the Bank's policy objective "Research, innovation and digital" of the Public Policy Goal "Innovation, Digital and Human Capital" as it concerns the implementation of an innovative advanced manufacturing technology in Europe for the production of cutting-edge Li-ion battery cells.


    The Project contributes to the development of the EU-based battery industry, for which it can be considered an enabler. The project caters for the transition to e-mobility by supplying the growing demand in Europe for EV Batteries with cutting-edge battery cells, thereby supporting the competitiveness of the EU automotive industry.


    Due to its enabling character for the transition to e-mobility the Project fully contributes to Climate Action (mitigation) objective. It meets the objectives of the Green Deal Industrial Plan proposed by the European Commission.


    The Project is located in a Cohesion Region and a Just Transition Mechanism territory, where it will create significant long-term skilled employment. The knowledge spill overs in the region and Europe at large are related to the development cooperation with the automotive OEM, the equipment suppliers, the EPC constructor for the development and construction of the specialised building (clean room, utilities), and with regional technical schools for the up/re-skilling of the labour force. It therefore contributes in full to Economic and Social Cohesion objective.


    The eligible area of the operation as per Annex II of the InvestEU Regulation and the Investment Guidelines is Environment and resources, in particular with respect to the decarbonisation of energy-intensive industries and the substantial reduction of emissions in such industries, including the demonstration of innovative low-emission technologies and their deployment.


    Europe must master the de-carbonisation of its transport sector. This passes through the transformation of its automotive industry from supplying vehicles running on carbon fuels to vehicles running on electricity. This, in turn, requires the build-up of a European battery industry. Europe lags in the industrialisation of battery technologies and the related know-how. 


    The Project addresses these failures.

    The Project:

    (a) has the nature of a public good for that the operator or company cannot capture sufficient financial benefits (knowledge dissemination through technology transfer and education and skills of the local labour, and a lasting specialised infrastructure being made available at no or negligible cost ? both in a Cohesion Region; support to EU-based automotive industry in its transition to e-mobility);

    (b) generates externalities which the operator or company fails to internalise, such as climate mitigation.


    The financing also addresses the market failure of insufficient investment in a transition region, thus supporting the strengthening of the EU's economic, social and territorial cohesion.


    The Project's external benefits are potentially high as it contributes to the establishment of an industrial value chain in Europe of a competitive battery technology. The Project will lead to important knowledge development and transfer to Europe. It will deploy advanced manufacturing activities and related jobs in Europe. The Project will furthermore help create the conditions for the deployment of e-mobility, and the development of a cleaner and more sustainable transport system in Europe and lead to lower emissions of pollutants (health benefits) and CO2 (climate benefits) on the roads.


    The proposed non-recourse structure is innovative for this type of Project, traditionally financed through corporate loans by commercial banks at sponsors' level. EIB's capability to appraise and structure the Project with unmatched terms and conditions on the commercial market would bring significant added value to the Promoter. EIB will not only close a large financing gap but also crowd in other financiers. The increased risk profile of the loan beyond what the Bank traditionally regards as acceptable, can be considered thanks to InvestEU protection.


    Considering the above, the Project will generate economic benefits that are greater than those captured by the investor's financial returns.


    The operation would not be carried out to the same extent by the EIB without the InvestEU support.


    Environmental aspects
    Procurement

    The project concerns capital investments for the production of lithium-ion electrodes and battery cells, falling under the environmental impact assessment (EIA) Directive 2014/52/EU amending the EIA Directive 2011/92/EU. All environmental, health and safety issues including environmental and operational authorisations will be reviewed during the due diligence process.

    The promoter has been assessed by the EIB as being a private company not subject to EU rules on public procurement or concessions. However, if at the project appraisal, the EIB were to conclude that the promoter is subject to the EU public procurement legislation then the European Commission will be duly informed and would require the promoter to apply those rules.

    Milestone
    Under appraisal
    Approved
    Signed
    12 July 2023
    21 March 2024
    Link to source
    Other links

    Disclaimer

    Before financing approval by the Board of Directors, and before loan signature, projects are under appraisal and negotiation. The information and data provided on this page are therefore indicative.
    They are provided for transparency purposes only and cannot be considered to represent official EIB policy (see also the Explanatory notes).

    Documents

    Environmental and Social Impact Assessment (ESIA) - VERKOR EV BATTERY GIGAFACTORY - Résumé Non Technique
    Publication Date
    15 Jun 2023
    Document language
    Main Topic
    Lending
    Document Number
    169720494
    Document Focus
    Environmental Information
    Project Number
    20220713
    Sector(s)
    Regions
    Countries
    Publicly available
    Download now
    Environmental and Social Impact Assessment (ESIA) - VERKOR EV BATTERY GIGAFACTORY - Etude d'impact
    Publication Date
    15 Jun 2023
    Document language
    Main Topic
    Lending
    Document Number
    169723874
    Document Focus
    Environmental Information
    Project Number
    20220713
    Sector(s)
    Regions
    Countries
    Publicly available
    Download now
    Environmental and Social Data Sheet (ESDS) - VERKOR EV BATTERY GIGAFACTORY
    Publication Date
    19 Jul 2023
    Document language
    Main Topic
    Lending
    Document Number
    162774453
    Document Focus
    Environmental Information
    Project Number
    20220713
    Sector(s)
    Regions
    Countries
    Publicly available
    Download now

    News & Stories

    Link to source

    Inside the project

    How and Why

    Verkor electric vehicle battery gigafactory

    Why

    • Cars and vans in the European Union must be zero emissions by 2035
    • Supports an innovative European startup
    • Contributes to Europe’s global competitive position in a key sector
    • Creates jobs in northern France

    How

    • Battery cells for 300 000 electric vehicles a year
    • More electric vehicles means fewer polluting fuel-run vehicles
    • Facilitates the green transition of the European automotive sector

    Impact

    Local production lowers costs

    • 16 GWh of battery cells annually by 2025, enough to power 300 000 electric vehicles
    • Local cell manufacturing will lower cost of batteries and vehicles
    • Advanced manufacturing processes will reduce carbon emissions
    • Europe will be more competitive in the global battery market
    Batteries account for between 30% and 50% of the cost of electric vehicles
    Europe needs to dramatically increase its battery production capacity by 2030 to meet its emissions reduction goal

    Play video

    2:53

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    Story

    Exactly what needs to be done for Europe

    Verkor
    "Our lithium supply will come from Europe. We’ll have some nickel supply in Europe and some cobalt supply from Morocco."
    Benoît Lemaignan

    Cofounder and chief executive officer, Verkor

    Benoît Lemaignan had an epiphany in the autumn of 2018. Just starting out as an investment manager at Meridiam, he received a pitch from Northvolt, a Swedish company seeking billions of euros to produce batteries for electric vehicles.

    “Wow, these guys are a little bit crazy,” Lemaignan thought. “But this is exactly what needs to be done for Europe.”

    That moment planted the seed for Verkor. Lemaignan and five others founded the French battery cell manufacturer in July 2020. The company grew very fast and attracted talents for their technical team from all over the world.

    Verkor is the third European battery manufacturer to build a gigafactory (though there are other gigafactories in Europe that are owned by Asian companies). 

    The gigafactory’s location near Dunkirk port in northern France will facilitate the import of raw materials and the export of finished products to the factories of the French carmaker Renault.

    The project is also expected to create 1 500 to 2 000 jobs in Dunkirk by 2030.

    Verkor

    “This operation checks all the right boxes. It’s an innovative European startup, it facilitates the green transition of the European automotive sector and it contributes to Europe’s global competitive position in a key sector.”
    Olivier Kueny

    loan officer, European Investment Bank

    General enquiries and comments

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    The EIB has a zero tolerance policy on fraud or corruption. To report allegations of fraud and corruption relating to EIB-financed projects, please contact the Fraud and Investigation division. All complaints will be treated as strictly confidential and handled in line with the EIB investigation procedures and the Anti-Fraud Policy.

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