Czech Republic Plans to Spend US$2.4 Billion to Support Development of Local EV Battery Production

published: 2021-08-19 9:30 | editor: | category: News

News agencies in Europe have reported that the Czech Ministry of Industry and Trade and ČEZ Group signed a memorandum of understanding indicating that they will be working together to help establish a local EV battery manufacturing plant. The memorandum was signed on July 27, and it entails a project investment of around US$2.4 billion. The ultimate goal is to land a “gigafactory” that has an annual production capacity of 40-55GWh and provides at least 2,300 new jobs.

ČEZ is a conglomerate of more than 100 entities that are located across Europe, and its core businesses are related to energy and electricity. The Czech government is currently its major shareholder. ČEZ owns EV charging stations and a major lithium mine in the Czech Republic. Last year, Pavel Cyrani, vice chairman of the conglomerate, announced an investment in a 10GWh battery production plant. This project is being jointly developed by ČEZ, the Slovakian government, and Slovakian EV battery manufacturer InoBat Auto. At that time, Cyrani said that the 10GWh battery production plant will be one of several joint projects, and its next gigafactory will likely be located in the Czech Republic.

The latest memorandum is part of the Czech government’s strategy for accelerating energy transition and transportation electrification. The content of the memorandum reveals that ČEZ and the Czech government will collaborate on strengthening the local battery supply chain, especially in the areas of lithium materials production and battery recycling. ČEZ is a major shareholder of the Cínovec mine in the Czech Republic. This mine is Europe’s largest lithium mine. Furthermore, the Czech Republic reportedly accounts for around 3% of the world’s lithium reserve.

Carmaker Volkswagen plans to have six operating gigafactories in Europe by 2030. Hence, the Czech Republic will likely become a host country for many battery manufacturing projects as Volkswagen’s subsidiary Skoda is headquartered in the country. The Czech government is also reportedly to be in talks with LG about the possibility of setting up local battery production facilities.

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