Norwegian Battery Firm Pulls Plug on $2.6B Georgia Plant 

A Norwegian firm has pulled the plug on a $2.6 billion factory in Newnan that was set to make utility-scale battery energy storage systems. 

Freyr Battery informed the Coweta County Industrial Development Authority of its pullback in a letter last month, with executives officially announcing the plan during the authority’s board meeting Feb. 6, the Newnan Times-Herald first reported. 

The company said Tuesday it would offload the 368-acre site to an undisclosed buyer for $50 million, the proceeds of which will be used to repay the state and county for grants totaling $27 million toward site acquisition and preparation. (Coweta contributed $20 million to win the investment, while a state’s so-called deal-closing fund kicked in another $7 million.)

According to the Atlanta Journal-Constitution, Freyr’s state and local incentive package was valued at $358 million, though property tax abatements and statutory incentives made up the majority of the total. Statutory incentives are doled out over time and are tied to jobs created and ongoing expenditures on manufacturing equipment, salaries and research and development.  

Beyond wiping out 724 promised jobs, Freyr’s departure deals a blow to Georgia’s booming new-energy sector, which has landed more than $20 billion in projects focused on electric vehicles, batteries and solar power. 

Some have already kicked into high gear, like the $7.6 billion Hyundai Meta Plant near Savannah, SK Battery’s $2.6 billion complex in Commerce and Hanwha Q Cells in Dalton, which has helped that firm become the U.S.’s largest solar panel producer. Others, meanwhile, remain either under construction or stuck in neutral. 

Rivian’s $5 billion automotive plant east of Atlanta was delayed last March, but a $6.6 billion Department of Energy loan approved in the final days of the Biden administration could revive the project. 

Joint-venture battery investments by Hyundai in partnership with fellow Korean companies SK (Cartersville) and LG Energy Solution (co-located with the Meta Plant) valued at $5 billion and $4.3 billion, respectively, have yet to come on line. 

The longer such projects remain in development, the greater the chance supportive underlying policies could shift with trade patterns and political winds. Even before President Trump took office in January, he called to kill the $7,500 EV tax incentive included in the Biden administration’s signature climate law, the Inflation Reduction Act. 

Freyr executives reportedly said in August that a glut of Chinese batteries was reducing prices, impeding efforts to raise capital for battery production. In announcing the Georgia factory in 2022, they framed domestically produced energy storage in national security terms, given China’s dominant hold on the global battery supply chain. 

Freyr’s Newnan project, meanwhile, was initially meant to address a problem that has long dogged renewable energy sources like wind and solar: a mismatch between when the energy is produced and when it is eventually used.

Battery-energy storage systems, or BESS, allow the grid to tank up on renewable energy when the sun is shining or wind is blowing, then release it when demand spikes. 

Ultimately, however, Freyr’s new leadership decided to move upstream: Producing solar panels, executives said, would not only generate immediate sales, bolstering the startup’s financial position, but it also could increase overall demand for the energy storage systems Freyr hopes to eventually bring to the United States.

In December, Freyr acquired the U.S. manufacturing assets of Trina Solar, a Chinese firm that had set up a factory in Wilmer, Texas, almost 20 miles south of Dallas. The $340 million deal gave Freyr immediate access to 5GW worth of solar module production, making it the third-largest domestic module producer right off the bat. 

Now, Freyr is searching for a separate U.S. site to make solar cells in a push for “vertical integration” in that supply chain. American-made modules and cells and even raw materials (for now) qualify for tax rebates under the IRA, a key driver of Freyr’s move to Newnan. 

Given the pending sale of the Newnan property, which the company said would close Feb. 15, Georgia does not seem to be in consideration for the new facility. Freyr also said Tuesday it is moving its corporate headquarters to Austin, Texas, a tech hub just a few hours’ drive from its newly acquired Dallas factory employing more than 1,000 people. 

Georgia, meanwhile, already has its own solar darling: Q Cells, the No. 1 panel producer in the U.S., is spending $2.5 billion across two sites in Cartersville and Dalton to build out more module capacity along with domestic sourcing for solar components like wafers, cells and ingots in Cartersville.

Freyr went public on the New York Stock Exchange in 2021 via a merger with a special purpose acquisition company, Alussa Energy, that raised $704 million, including $115 million from Koch Strategic Platforms. A few months later, Freyr and KSP, an investment arm of the Koch Industries private conglomerate, launched a $70 million joint venture to create a U.S. counterpart to Freyr’s European planned “giga-factory” above the Arctic Circle. They licensed battery technology from 24M, with which Freyr has since ended its commercial arrangement. Freyr has retained its cathode active material factory in Finland, which is backed by a €122 million grant.

Announced in November 2022, just three months after the IRA was signed into law, the Newnan project aimed to 34 GW worth of battery cells in its first phase.