Aurora Lithium looks to Brussels funds
The CEO of Aurora Lithium – the company that plans to build a lithium refinery in Portugal – Manuel Sousa Martins, whose total investment value is between €700-800 million, hopes to be able to net European finance worth €52 million; almost five times more than the €11 million initially foreseen.
The entrepreneur hopes to get this amount, according to the online news source ECO, in the light of the ‘sweeteners’ that were granted in the case of a batteries factory owned by its shareholder, Northvolt, in Germany.
The value of the financial grants will enable Aurora Lithium to gauge if the project is profitable both in absolute terms and in relation to other locations.
At present, Aurora, with the help of the government agency IAPMEI which supports SMEs, Micro companies and startups, and the Ministry of the Economy, are working towards expanding the European funding incentive on the back of the Recovery and Resilience Plan worth €11 million now and up the investment grant to €52 million.
“Even so, the upgrade from €11 million to €52 million is (only) around 7% of Aurora’s investment”, Sousa Martins explained when it was compared to the kind of investments awarded in the United States.
“We have competitors in the United States with a ‘name and surname’, and whose locations are identified, with building plants just like ours, with 40-50% in financial incentives”, he said on the sidelines of the conference ‘How can the US policymakers and companies play to amplify each other’s energy transition efforts? – Opportunities and Risks for Portuguese Companies and Portugal’ organised by the American Chamber of Commerce in Portugal (AmCham) on Thursday, January 18 at the Pestana Palace Hotel in Lisbon which debated the incentives made available in the United Staes of America and in Europe for green transition.
Northvolt, a Swedish company founded in 2016, that is working towards developing the world’s greenest battery cell and establishing a European supply of batteries, has a partnership with Portuguese energy company Galp to construct one of the largest lithium refineries in Europe. Both Galp and Northvolt are shareholders in Aurora Lithium and have been given the green light by Brussels to access €902 million of Sate funding, which will be used to build a batteries factory in Germany.
For the first time the EC adopted a regime that enables governments to approve greater financing for projects at risk of being relocated to countries like the US where they stand a chance of getting better financing conditions.
Northvolt had already threatened to relocate the plant to the US where, according to the Financial Times, it would get access to such financing.
Manuel Sousa Martins said (the EC’s decision) set a good precedent at a European level, and faced with the possibility of getting finance of over 6% of the total value of the investment. “We hope — and there is already a case in this sense of a shareholder — to be able to help build an argument around this matter, but the decision “isn’t up to us, but we’ll try to get it to be so”.
