Glencore invests in Britishvolt for first UK gigafactory

Mining company Glencore has acquired a stake in battery startup Britishvolt, which has plans for a gigafactory intended to power the UK automotive industry's switch to an electric future.

According to the agreement, Glencore will also supply cobalt - one of the vital raw materials used in electric vehicle batteries - to the gigafactory, which is currently being constructed in Northumberland, Northeast England.

The partnership is seen as the highest endorsement so far for the UK's first gigafactory - a £2.6 billion (€3.04 billion) project that supporters say is essential for the country's homegrown electric car sector to take off and to reach the government's carbon reduction goals.

Read more: Northvolt increases planned gigafactory capacity due to high demand

The UK has set a target of 2030 to ban sales of new petrol and diesel cars and the auto sector is racing to establish an electric vehicle infrastructure, including battery supply, capable of producing at scale.

"From Britishvolt’s perspective this is a major milestone, securing responsibly produced raw materials to help de-risk the project," said Orral Nadjari, Britishvolt’s CEO and founder.

"If you look at global cobalt production two players stand out - Glencore and the Chinese."

The amount invested by Glencore in Britishvolt has not been disclosed but it will make the mining firm one of the startup's largest investors

Glencore is the world's largest cobalt producer and will supply Britishvolt with 30% of the metal it requires between 2024 and 2030. Its use in the burgeoning global electric vehicle industry has made cobalt one of the most sought-after raw materials in the world.

The company already supplies cobalt to Tesla and BMW from its mines in Australia and the Democratic Republic of Congo. Glencore and other mining companies have been working to develop a blockchain platform to ensure the metal's ethical production in the DRC. 

Britishvolt is one of just a handful of gigafactories in Europe to have secured planning permission and is mulling going public in London or New York.

The battery plant will be constructed on the site of a decommissioned coal-fired power station in Blyth, northeast England and will initially employ 1,000 people. This number is set to increase to over 3,000 once the gigafactory is at full capacity.

Read more: Nissan announces £1bn Sunderland gigafactory to boost EV production

The 93-hectare plot was chosen because of its access to a deep-sea harbour and its electricity grid connection. The plant has a targeted capacity of 30 GWh/year - equivalent to around 300,000 battery packs - with the first production expected at the end of 2023. 

Although several companies are in talks with the UK government about building battery gigafactories, only Britishvolt and Nissan have declared their plans publicly.

Glencore’s head cobalt trader David Brocas welcomed the deal with Britishvolt. "Our commitment to support our partners in meeting their requirements for essential battery ingredients is key to underpinning long-term supply agreements," he said.

"As the mobility and energy transition accelerates, so does forecast demand for future-facing metals such as cobalt, copper and nickel."

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