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The development of Freyr's battery factory, Giga Arctic, continues at a measured pace with the expectation of a potential Norwegian response to the US support package for American businesses – meant to accelerate the development of green industry in the US.

This is made clear in the company's quarterly report for the first quarter of 2023.

Giga Arctic is Freyr Battery's planned battery factory in Mo i Rana, Northern Norway. The NOK 40 billion Gigafactory has been referred to as potentially one of the most prominent establishments in mainland Norway in recent times.

Freyr announced a decision to invest of NOK 17 billion in Giga Arctic in June 2022 (Norwegian only). Furthermore, Freyr needs more than NOK 15 billion in additional capital injections to complete the factory.

At the same time that the company is developing Giga Arctic, the company has also announced a venture in the US with the building of the Giga America factory in Coweta County in the state of Georgia.

The American expansion was accelerated by the Biden administration's aforementioned legislation, the Inflation Reduction Act (IRA).

The quarterly report reveals that financial discussions include the initial and subsequent phases of Giga America, which is supported by the IRA – as well as Giga Arctic, which is supported by the ongoing project financing process and the anticipated Norwegian response to the IRA.

Awaits the government's IRA response

In the quarterly report, Freyr announces it has received a letter from the Norwegian government stating that it is now updating and adjusting its response to the US Inflation Reduction Act, as well as the EU's Temporary Crisis Transition Framework.

According to the letter, the government aims for solutions that will strengthen Norway's comparative advantages and preconditions. In the letter, the government also emphasizes Norway's ambition to be an attractive host nation across the battery value chain and to attract major battery-related investments in gigafactories through its national battery strategy, in close collaboration with the EU.

The government also indicated that a detailed summary of its response to the IRA would come this summer.

Develops Giga Arctic and Giga America in parallel

"Developing Giga Arctic and Giga America in parallel is done with the intention of maximizing the option value of the company, its customers, and other key stakeholders," reads the quarterly report.

The company notes recently announced support packages for gigafactories in Germany, France, and Spain, and writes that while awaiting a government response to the IRA, Freyr will proceed with the development of Giga Arctic at a measured pace.

Freyr spent USD 64.1 million on previously authorized investments in the first quarter of 2023, of which approximately 75 percent was allocated to Giga Arctic, with the remainder going primarily to the completion of CQP, Freyr's customer qualification plant in Mo i Rana.

At this facility, Freyr expects to begin casting of electrodes with active cathodes and anode materials in the year's second quarter.

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This article was originally published in Norwegian and has been translated by Birgitte Annie Molid Martinussen.