“In addition to the expansion of Northvolt Ett’s cathode production and cell manufacturing, the finance package will enable the expansion of the adjacent recycling plant,” Northvolt said in a statement.

The financing is provided by “a group of 23 commercial banks, as well as the European Investment Bank (EIB) and the Nordic Investment Bank (NIB).”

Peter Carlsson, CEO of Northvolt, called the financing “a milestone for the European energy transition.”

With this loan, the battery maker has secured $13 billion in equity and debt seeking to supply the growing market of electric vehicles (EVs).

READER INSIGHTS:

• Meet the foreigners moving to northern Sweden to turn industry green

According to Northvolt, it has secured “long-term offtake contracts” worth over $55 billion, including with carmakers BMW, Volvo Cars and Volkswagen Group.

Europe accounts for just three percent of global battery cell production – which China dominates – but it is aiming to catch up and has set its sights on 25 percent of the market by the end of the decade.

In November, Northvolt said it had developed a new battery based on sodium-ion technology, which uses less critical minerals.

Sodium-ion batteries are viewed as a cheaper and in some respects safer alternative to the lithium-ion batteries widely used in both electronics and electric vehicles but which pose a fire risk if damaged.

While sodium-ion technology has been around for decades, it has lagged lithium-ion batteries in performance.