FREYR Battery, a European start-up company that produces lithium-ion batteries on a large scale, has announced that it has signed an off-take agreement for 31 GWh of batteries with a manufacturer of energy storage systems.

(FREYR Battery went public on the New York Stock Exchange in July of this year)

FREYR Battery is one of more than 20 battery manufacturers planning to build megafactories in Europe, and the company plans to use renewable power for its four battery production plants, including the use of Norway's abundant hydropower resources.

The company has already begun construction of a 2GWh per year battery production plant in the Norwegian town of Mojlana. They have entered into a technology partnership with 24M, a U.S. developer of advanced battery technology, to produce batteries using 24M's new production platform for the development of Semi Solid.

24M claims that batteries produced using this platform have thicker electrodes than other types of batteries and have higher energy density and lower production costs than other batteries.

FREYR Battery said it has signed an agreement to supply at least 31 GWh of batteries to a publicly traded manufacturer and supplier of energy storage systems (ESS).

FREYR Battery CEO Tom Jensen said the name of its customer has not yet been disclosed, but this is FREYR Battery's first major offtake deal.

The battery products will be delivered from FREYR Battery's manufacturing facility in Norway over a five-year period from 2023 to 2028, and the company expects the deal to be about $3 billion in size.

This development led to our final investment decision to begin construction of a battery production facility and to bring FREYR Battery's batteries to industrial-scale commercial production," Jensen said. The next generation of batteries we produce combined with battery storage technology will provide industrial and utility customers with differentiated solutions for the battery storage market." 

The company aims to achieve a battery production capacity of 43 GWh by 2025 and 83 GWh/year by 2028. Earlier this year, it formed a joint venture (JV) with Koch Strategic Platforms to explore the possibility of building 50GWh of manufacturing capacity in the U.S. by 2030.

In addition, FREYR Battery's closest geographic competitor, Northvolt, is reported to have signed a partnership agreement with Fluence, a major energy storage systems and technology provider, which has already built a mega-factory in Sweden and plans to achieve 150 GWh of annual capacity by 2030. The partnership with Northvolt includes offtake and cooperation in the development of stationary energy storage solutions.

Lithium-ion batteries (LIBs) have become a major energy storage solution in modern life. Among them, lithium iron phosphate batteries are perfect replacements for lead-acid batteries and are more preferred by industries such as grid-connected peaking, off-grid energy storage, photovoltaic energy storage, UPS, and data centers.