Japanese battery firm AESC has secured guarantees that could unlock £1billion ($1.3billion) of funding as it continues with plans to build its second lithium-ion battery gigafactory in Sunderland, UK.
The National Wealth Fund (NWF) and UK Export Finance (UKEF) will provide financial guarantees for the project – namely each providing an 80% financial guarantee covering £272 million of a £340 million loan.
The guarantees unlock £680 million in financing from a group of commercial banks which include: Standard Chartered, HSBC, SMBC Bank International Plc, Societe Generale and BBVA.
The guarantees are key to the delivery of a wider project financing package worth more than £1 billion.
The NWF’s financial guarantee follows and replaces an initial £200 million short-term bridging loan to AESC announced in January 2024 (prior to the UK Infrastructure Bank transitioning into the National Wealth Fund).
When completed, AESC’s second plant will have a capacity of 12GWh, adding to its 1.8GWh plant that started production in the UK in 2012.
Last September, AESC gained planning permission from Sunderland City Council for a third gigafactory in the UK.
The plans are for a 195,000m2 development on green belt protected land at the International Advanced Manufacturing Park. The planned plant will have a yearly capacity of 12GWh.
Read more about the plans here.
In July last year, AESC broke ground at its new LFP gigafactory site in Spain.
The new plant, in Navalmoral de la Mata, Cáceres, is scheduled to begin production in 2026 and have a reported 30GWh capacity when completed. Read more about the project here.
Read more about Europe’s race to win the lithium-ion battery making prize here.
