EV battery maker AESC has secured a £200m loan from the UK Infrastructure Bank to support the development of its North East Gigafactory.

The site will be AESC’s second battery plant in Sunderland

The bridging loan will help fund the construction of the 15.8GWh gigafactory in Sunderland, which started work in 2022.

The site will be AESC’s second battery plant in Sunderland and will join the existing 1.8GWh facility that was built in 2012. Currently the UK’s only operational gigafactory, the site produces packs for the Nissan Leaf electric family car built next door at the carmaker’s plant.

The second gigafactory is part of a wider project also involving Nissan that will see the Japanese carmaker build future all-electric versions of its flagship Qashqai and Juke crossovers, along with the next-generation Leaf, at Sunderland.

AESC’s second Sunderland battery plant will significantly ramp up UK electric vehicle battery production, supporting the Government’s recently published Battery Strategy, which seeks to secure the UK’s place as a major battery manufacturing nation.

The new gigafactory will be powered by 100% net zero carbon energy and will employ more than 1,000 people when operational in 2025.

John Flint, UK Infrastructure Bank CEO, said: “A domestic battery supply chain will play an important role in the UK’s transition to net zero and also the wider economy, as highlighted in the Government’s recently published Battery Strategy.

“Gigafactories are an essential part of that supply chain. They also have the potential to secure and create thousands of jobs, but serious investment is needed to scale up production.

“This loan signals the bank’s appetite to play a meaningful role in the financing of the domestic battery supply chain and that we are ready and willing to deploy capital where it is needed for this crucial net zero infrastructure.”