Freyr Battery, a clean energy company, has abandoned plans for a massive electric battery factory in Newnan, Georgia, opting instead to focus on a recently acquired solar panel manufacturing facility in Texas. The decision marks a significant shift in strategy for the company, impacting Georgia’s burgeoning electric vehicle and renewable energy sector.
The proposed Georgia plant, announced in 2023, was projected to be a $2.6 billion investment creating over 700 jobs. It aimed to produce batteries for storing electricity generated from renewable sources, positioning itself as the second-largest battery factory globally upon completion. However, construction never commenced on the 368-acre site.
Freyr, which relocated its headquarters from Norway to Newnan to capitalize on U.S. tax incentives under President Biden’s climate law, cited several factors contributing to the decision. Rising interest rates, declining battery prices, a change in leadership, and an evolving company focus were cited by Freyr senior vice president of business development Jason Peace in a meeting with local officials. The company’s acquisition of a Trina Solar panel factory in Texas for $340 million last year solidified the strategic shift towards solar panel production.
“We are so grateful for the support and partnership we found in Coweta County and throughout Georgia,” stated Freyr spokesperson Amy Jaick. “However, as noted in our December release, we are focusing at the moment on the solar module manufacturing facility in Texas.”
The Georgia Department of Economic Development confirmed a $7 million state grant was provided to Freyr for site acquisition in Newnan. The state is currently working with Freyr to ensure prompt repayment of the funds. Potential financial obligations to Coweta County may also exist. “Georgia’s incentives process protects the Georgia taxpayer, and when a company’s plans change, that process ensures discretionary incentives are repaid,” a department spokesperson affirmed.
While the project’s cancellation represents a setback for Georgia, local officials remain optimistic. The planning process strengthened Coweta County’s position for attracting future developments, according to the Coweta County Development Authority.
Freyr’s strategic shift also reflects broader challenges within the battery industry. In November, the company announced plans to divest its European operations and terminated a battery technology license agreement. Former CEO Tom Einar Jensen highlighted the difficulties in securing funding for battery production due to a surplus of lower-cost Chinese batteries. This prompted Freyr to pursue cash-generating ventures, including solar panel manufacturing, as its cash reserves dwindled.
This development comes amidst Georgia’s aggressive pursuit of electric vehicle industry investments. SK Innovation’s $2.6 billion battery plant in Commerce and Hyundai Motor Group’s $7.6 billion electric vehicle and battery facility near Savannah exemplify the state’s commitment to the sector. Rivian’s revived plans for a $6.6 billion plant east of Atlanta, supported by a federal loan, further underscore this focus. Freyr’s decision highlights the dynamic and competitive landscape of the renewable energy market, influencing investment decisions and regional economic development strategies.
