Envision AESC France Secures EU Nod for $50M French Aid for EV Batteries Plant

The European Commission has approved a €48 million French measure to support Envision AESC France in setting up a new factory for the production of Lithium-ion batteries for electric vehicles in Douai. The aid, which will take the form of a direct grant, will contribute to the EU's strategic objectives relating to job creation, regional development, and the green transition of the regional economy.

The French measure aims to support the establishment of the first phase of a new factory in Douai, Hauts-de-France, with an annual capacity of 9 GWh in this first phase. The project is expected to create approximately 1,000 direct jobs, as well as further indirect jobs, and the new factory is designed to be carbon neutral.

The Commission's assessment found that the measure will contribute to job creation, economic development, and the competitiveness of a disadvantaged area. The aid has an incentive effect, as the beneficiary would not carry out the project without the public support. The measure has a limited impact on competition and trade within the EU, and the aid is proportionate since it is limited to the minimum necessary to trigger the investment and will not exceed the maximum aid amount allowed by the French regional aid map.

The new factory in Douai is part of Envision AESC's global expansion plans, which include building gigafactories in France, Japan, the US, the UK, and China. The company aims to achieve an annual production capacity of 24 GWh by 2030, with the potential to expand capacity by 40 GWh in Douai, France. Envision AESC has so far produced power batteries for more than 600,000 electric vehicles in 44 countries over the past 12 years, with zero accidents.

The European Investment Bank (EIB) is also supporting the project by providing €450 million in aid to the Japan-based company for its factory in France. This financing will be used to realize the first phase of the plant, with an initial annual capacity of 9 GWh for Renault from 2025. The factory is planned to expand gradually, up to 24-30 GWh in 2030.

The project aligns with the European Green Deal's objectives, particularly the goal of achieving a carbon-neutral society by 2050. The project contributes to several specific targets of the Green Deal, including job creation and regional development, green transition of the regional economy, strengthening industrial sovereignty, and supporting the automotive sector's transition to electric vehicles.

The investment in Envision AESC's battery gigafactory in France, involving a Chinese company, has potential geopolitical implications, given the strategic importance of battery production in the global energy transition. The project could have implications for competition and industrial sovereignty, technological leadership, energy security and strategic partnerships, regional development and job creation, and environmental and climate change considerations.

In conclusion, the EU's approval of French aid for Envision AESC's battery plant in Douai supports the European Green Deal's objectives by fostering job creation, regional development, green transition, industrial sovereignty, and the shift towards clean mobility. The project's planned capacity expansion will significantly impact the European Union's goal of achieving battery independence and enabling broader electrification efforts in the region.