EV battery giant Northvolt to build multibillion-dollar plant in Quebec

Northvolt, a Swedish battery manufacturing giant, says it will build a new multibillion-dollar electric vehicle battery plant east of Montreal — a project Quebec leaders are calling the largest private investment in the province's history.

Prime Minister Justin Trudeau and Quebec Premier François Legault were in Montreal Thursday morning alongside other ministers and Northvolt executives for the announcement.

The mega-factory, Northvolt's first outside of Europe, will span 170 hectares and will be built in the area near Saint-Basile-le-Grand and McMasterville, Que., about 30 kilometres east of Montreal.

The first phase of the project, valued at $7 billion in total investment, will have an annual battery cell manufacturing capacity of up to 30 GWh. It will also create up to 3,000 jobs in the region as the plant reaches its full production potential.

No timeline was provided for the second phase of the project, which is expected to double output.

"This is a historic and transformative announcement," Trudeau told the crowd Thursday, saying the investment will bring "end-to-end battery manufacturing" to Canada.

"This facility will be able to produce batteries for a million electric vehicles a year and, at full production capacity, the plant will contribute up to $1.6 billion to our economy."

The site will also include facilities for cathode active material production and battery recycling.

François Legault said Quebec has reached its vision of becoming a world leader in the green economy. (Ivanoh Demers/Radio-Canada)

Quebec and Ottawa will invest a total of $2.7 billion for the construction of the factory, expected to be built by the end of 2026.

Canada and Quebec have committed to providing Northvolt with production support to match the Inflation Reduction Act's Advanced Manufacturing Production Credit in the United States, equalling up to $35 US per kWh.

The company will also be eligible for government production incentives up to $4.6 billion over the next five to nine years, of which one-third is to be paid by the Quebec government, amounting to another $1.5 billion from the province.

Legault praised the announcement as being "the biggest private investment in the recent history of Quebec."

He said Quebec has reached its vision of becoming a world leader in the green economy.

Northvolt chose the site east of Montreal out of 70 different locations in North America.

Paolo Cerruti, co-founder of Northvolt, will lead the project as CEO of Northvolt in North America, headquartered in Montreal.

He said Quebec's unique access to 100 per cent renewable energy and raw materials made it the ideal base of operations for its first mega-factory outside Europe.

At full capacity, the factory, titled Northvolt Six, will have an annual battery cell manufacturing capacity of 60 GWh, with adjacent facilities for the production of cathode active materials and recycling, enabling circular production entirely on site. (Ivanoh Demers/Radio-Canada )

But the news is already raising fears in the region related to noise and pollution from the plant, as well as housing concerns.

A petition with 700 signatures has been submitted to the McMasterville municipal council to block the project.

Thursday's event adds to a series of recent announcements in the battery ecosystem in Quebec. Ottawa and Quebec announced an investment of more than $640 million for a new Ford EV plant in Bécancour, Que., last month.

Opposition parties react

Quebec opposition parties are questioning the province's massive investment in yet another multinational.

"With public investments of $1.37 billion, the [Legault] government must be transparent," said Haroun Bouazzi, energy critic for Québec Solidaire and the MNA for Maurice-Richard, in a statement.

"Despite the premier's enthusiasm, the investment announced today still includes financial risks for the money of Quebecers."

Legault said 50 years ago, when premier Robert Bourassa spent billions on massive hydro-electric dams in northern Quebec, people called him crazy, too.

"Today, for the next 50 years, what's going to be important is the green economy," said Legault. "So we're building on what Bourassa and company did in Quebec."

At the National Assembly, the Official Opposition's economy critic, Liberal MNA Frédéric Beauchemin, said he'll wait before saying the project is a bad development strategy.

"Vision is important, long-term planning is important. I'm not saying that it's bad news […] but we need to see labour, we need to see the housing, we need to see power for it to be successful," said the Liberal MNA.

Beauchemin believes the Legault government should be investing more in small- and medium-sized companies since they are crucial to maintaining the province's smaller communities.

Meanwhile, Bloc Québécois Leader Yves-François Blanchet, who is also the MP for Beloeil-Chambly, said he welcomes the announcement of the Northvolt plant in the heart of his riding.

"It enables Quebec to assert its position as a leader in the electrification of transportation," Blanchet said in a statement, adding the plant could counter the migration of the province's electric vehicle battery expertise to Ontario.

He notes, however, that the concerns raised by residents should be properly addressed.