215-jobs for city
Dundee chosen for £190m battery megafactory
Dundee has been chosen as the site of a £190 million battery “megafactory” creating 215 on-site jobs.
It will be built at the Michelin Scotland Innovation Parc, the former tyre factory, with a formal lease agreement to be signed this year.
AMTE Power, the Thurso-based developer and manufacturer of lithium-ion and sodium-ion battery cells for electric vehicles, said it will be a “stepping stone” to build larger gigafactories to meet the huge demand for battery technology.
The Dundee megafactory will have the capacity to produce over 25,000 high added value batteries per day, over eight million per year. Management anticipates revenue generation of over £200 million per annum at full production, based on AMTE’s customer market engagement.
The total required investment is estimated to be between £160-190m.
AMTE has received an indicative offer of support from Scottish Enterprise which is also expected to facilitate continuing discussions with other UK State owned enterprises, including the Automotive Transformation Fund.
The MegaFactory is expected to be funded by a combination of grant funding, as well as traditional and government assisted debt and equity.
Aside from 215 on-site jobs, the factory will create 800 jobs in the wider supply chain during development and operations.
The plant is expected to be operational and in production by Q3 2025 based on current planned timings.
Thurso remains a core manufacturing facility focused on production of AMTE’s cells and developing next generation cell technologies.
Stock market quoted AMTE said the proposed factory at Dundee paves the way for it to rapidly scale up to mass-manufacturing volumes.
Due to the high value nature of AMTE’s products, a factory can be profitable at a smaller scale than the size of factories at multiple GWh size, benefiting from quicker commissioning time, more flexibility in location, requiring less investment and a faster path to profitability.
The construction of its first MegaFactory in Dundee would act as a template and create a platform for AMTE to rapidly scale-up the production of its higher value cells through the construction of further battery plants.
The model is repeatable and is expected to enable AMTE to be flexible in meeting market demand for its differentiated cells: Ultra-High Power that has been developed with the automotive industry for high performance vehicles and Ultra-Safe for the energy storage sector being the cells attracting most advanced market interest.
Located at the old Michelin factory, the project is expected to help revitalise this brownfield industrial facility, boosting the local economy.
“The site is perfectly suited for a battery MegaFactory with a highly skilled, local workforce, good transport links and a commitment from the Scottish Government for net zero manufacturing, and enabling the energy transition in Scotland towards achieving net zero emissions of all greenhouse gases by 2045,” said AMTE.
Minimal planning permission is required to convert the former Michelin plant into a high-tech, modern MegaFactory reducing capital costs and meaning AMTE can start construction quickly.
The Dundee site would significantly increase AMTE’s cell production capacity, complementing and building on the expertise AMTE has gained at its existing facility at Thurso in the north of Scotland, the first site in the UK to develop and produce a commercial scale battery product.
Thurso enables AMTE to perfect the manufacturing process and anticipate what challenges or opportunities large-scale manufacturing rates might bring. Thurso remains core to AMTE manufacturing capabilities in scale-up, providing capacity to accelerate the development of next generation cells and scaled production.
This is alongside its ongoing work to develop high-performance cells at the UK Battery Industrialisation Centre in Coventry and at its head office in Oxford, where successful progress underpins our confidence in our future development path.
Currently, AMTE is one of the only cell manufacturers working in the UK, with commercial partnerships in place to support requirements for energy storage and specialised automotive industries.
The Market: energy storage & high-performance automotive
The market demand for battery cells is huge. Bloomberg estimates that installations of home energy storage batteries will rise from 6GWh in 2019 to 155GWh annually by 2030. Currently only 5% of the energy used to heat our homes today comes from low-carbon sources and massive growth is expected as part of the transition to net zero in the next 15 to 20 years.
In the electric vehicle market, the UK Government has set a 2030 deadline to end the sale of petrol and diesel cars. In addition, legislation is coming into force in just two years’ time which will stipulate that cars made in the EU or UK need to contain up to 50% of locally sourced materials in order to avoid tariffs. This presents a significant opportunity for AMTE.
The MegaFactory has received support from the UK Government’s Automotive Transformation Fund which will help to fund the detailed planning of the Dundee factory as part of the Government’s ambition to develop technology for the automotive and energy storage markets.
Kevin Brundish, CEO, AMTE Power, said: “We are excited to announce Dundee as our preferred location for our first MegaFactory, a quantum leap for AMTE. The change in our execution strategy will accelerate our journey to mass manufacture of high value added, differentiated cells.
“The MegaFactory will be a platform from which AMTE can harness our advanced inhouse capabilities to build manufacturing plants to meet the huge demand for battery cells – allowing us to rapidly scale up production and fast-track the path to achieving net zero.
“Battery cells are fundamental to enabling the UK’s energy transition and with this investment, we will play a key role in electrifying the vehicles, homes and industries of the future. The site at Dundee is the ideal location for a MegaFactory; it has local industry knowledge and is close to our current and future market in energy storage. We look forward to updating all stakeholders on our progress.”
Councillor John Alexander, leader of Dundee City Council, said: “This is an exciting proposal which has the potential to deliver hundreds of direct and supply chain jobs.
“All partners are committed to delivering on the vision that we had for MSIP following the closure of the tyre factory.
“AMTE’s proposed MegaFactory is a great fit with that vision and would build significantly on the successes that have already been achieved in securing tenants for the Parc. We want to be at the forefront of new technologies.
“We want to have a workforce with the right skills for future needs. And, ultimately, we want to create sustainable employment for local people.
“We look forward to working closely with local and national partners to help progress AMTE’s plans and secure this major investment in Dundee.”