Norwegian polysilicon manufacturer and silicon product provider Elkem has announced plans for a graphite battery factory at the Herøya Industrial Park in Porsgrunn, 150km south of Oslo.

The Northern Recharge manufacturing facility is intended to help create a strong European battery industry, said Elkem, which is part of the China National Bluestar Group chemicals business held by the state-owned China National Chemical Corporation.

“This enables us to build a highly cost-effective plant with good access to renewable energy, potentially lowering CO2 emissions by 90% compared to alternatives based on fossil energy,” said Elkem Battery Materials VP Stian Madshus of the graphite battery fab. “We also secure close proximity to our pilot plant and internationally-leading research environments within material technology.”

The company has a NOK65 million ($7.36 million) pilot graphite battery production site in Kristiansand which is set to start operation early next year. That facility, and the planned fab in Porsgrunn, will produce lithium-ion batteries based on a graphite anode material that will have potential applications for consumer electronics, electric vehicles and grid scale battery storage.

Elkem stressed the importance of Norwegian public support for its new project. The company stated: “For Norway to realize our potential, we need to see public-private partnerships, public support mechanisms and supportive policies developing with sufficient speed and scale, enabling us to win in this global competition.”

China National Bluestar Group agreed to acquire Elkem for around $2 billion in 2011. In March 2014, Hong Kong-based financial investor, Guangyu International agreed to invest $200 million in new equity in Elkem Solar, which owns a 6,000 MT polysilicon factory in Kristiansand, southern Norway. Bluestar also acquired Norwegian PV manufacturer REC Solar ASA for NOK4.34 billion ($491 million) in 2015.