French fossil fuel firm Total plans to build pilot battery manufacturing facilities in Europe combining the knowledge of its lithium-ion battery making arm Saft and vehicle OEM Groupe PSA.
The partners intend to establish a joint venture named Automotive Cell Company (ACC) with the goal of producing electric vehicle batteries starting in 2023.
This first phase of the plans include a 8GWh production plant (rising to 24GWh) scheduled to start up in the middle of next year at a cost of €200 million ($220 million), in the northern Hauts-de-France region.
In order to reach 48GWh of combined capacity by 2030 a second plant of equal capacity will be built in Germany at a cost of €5 billion ($5.5 billion)— including €1.3 billion ($1.4 billion) in public funding through French, German and European Union authorities.
The overall capacity will represent production of one million batteries a year.
ACC will be a 50-50 Saft and Groupe PSA/Opel joint venture for the pilot production line. During the commercial production phase, Saft’s share in ACC will fall to 33%.
Total bought Saft in 2016 to develop energy storage to support the growth of intermittent renewable energies such as solar and wind.
“The fast-growing development of electric mobility offers Total, via Saft, another opportunity for growth and commitment to a decarbonised economy,” said Patrick Pouyanné, chairman and chief executive officer of Total.
In 2019, the European Union set targets to expand the sale of electric vehicles to more than seven million units by 2030. The increase will amount to around 400GWh by 2030, or 15 times today’s needs.
The project’s implementation is contingent on securing the approvals of the relevant antitrust authorities.