Sweden’s National Debt Office (NDO) has confirmed it will not activate $1.5 billion in credit guarantees for Northvolt AB, following the battery manufacturer’s decision to halt expansion at its main factory in Skelleftea. The company suspended its build-out last month due to financial challenges and did not draw on the guaranteed funds. This week, Northvolt placed the unit managing the project into bankruptcy.
The credit guarantees were tied to Northvolt’s expansion plans, but NDO Director General Karolina Ekholm said the funds cannot be applied to other operations without approval. The NDO is open to new requests, provided they align with Sweden’s regulations on green investment credit guarantees, although EU rules could complicate matters for Northvolt due to its financial status.
Northvolt is now focusing on raising production at the Northvolt Ett plant in Skelleftea, but faces financial hurdles, including a $28 million tax bill due in mid-October. The company is seeking additional financing to improve liquidity and continue operations.