Northvolt to turn old Swedish paper mill into next battery gigafactory

Northvolt has signed a letter of intent to buy a closed paper mill in central Sweden from Stora Enso to develop the site into a gigafactory for active material and lithium-ion battery cells.

The plant at the Kvarnsveden Mill and the surrounding industrial area in Borlänge will be using 100% clean energy from the region, the battery specialist said.

It is expected to start operations in late 2024 and slated to employ up to 1,000 people. Fully built out, the site will have a potential annual production capacity of more than 100 gigawatt hours of cathode material, with will enable cell assembly at multiple Northvolt facilities. The site will also feature cell production.

“Since Northvolt’s founding, we have focused on circular battery production, but this is the first time we will reuse an entire production site,” Northvolt chief executive Peter Carlsson said.

“With its access to energy, industrial water and the broad production know-how in the region, Kvarnsveden is an optimal site for a gigafactory.”

Northvolt didn’t detail how big the cell production at Borlänge is expected to be.

Sweden with its huge hydro-electric and wind power potential and cheaper electricity costs than in most of Europe is ideal to cater for the rapidly increasing thirst of Europe’s car manufacturing sector for cells and batteries.

Northvolt said planned Borlänge plant will play a key role in fulfilling more than $50m in orders from key customers. The company already has lined up supply deals with Volkswagen, BMW, Volvo and Scania.

“There is a massive global demand for sustainable, high-quality lithium-ion battery cells and systems,” Carlsson said.

The Borlänge project is also key for revitalisation of the local economy, as the closure of Stora Enso’s paper mill last year caused the lay-off of over 400 people.