BBVA supports financing of an electrical vehicle batteries gigafactory in France to AESC through a project finance

BBVA has led the project financing as Mandated Lead Arranger and Hedge provider of gigafactory of batteries for electric vehicles in France signed in September. In this way, the bank supports AESC in the construction and operation of a gigafactory in Douai, next to Renault ElectriCity production sites. The NZBA has acknowledged this operation in its 2023 progress report, presented at COP28. 

Within the framework of BBVA’s strategy and its target to channel €300 billion in sustainable financing for 2025, BBVA has led as Mandated Lead Arranger and Hedge provider, along with five other banks, an electric vehicle batteries gigafactory Project Financing signed in September. It’s the first project finance of this kind for BBVA and, with it, the bank supports AESC in the construction and operation of a gigafactory based in Douai (France), next to Renault ElectriCity production sites.

The gigafactory is planned to start operations in 2025 with a 9 GWh production capacity of NMC batteries mainly to be supplied to Renault and aims to reach a production capacity up to 30 GWh/year by 2030, creating up to 3,000 new jobs. 

The project will support the EU ambitions for clean mobility; the gigafactory as well will support Renault's competitiveness, and meet its sustainable transition targets for becoming 100% electric in Europe by 2030, evidencing the virtuous circle of the transition.

AESC and Renault entered in a strategic partnership so that the gigafactory will supply batteries to Renault over 2025-2030 to its new electric vehicles to be launched: the 4EVER, inspired by the Renault 4 (4L) and the ECHO, based on the Renault 5 (R5).

The project financing amounts to EUR 819 MM and includes an EIB Loan, a BPI Covered Tranche, a Sinosure Covered Tranche and commercial ancillary facilities. The financial structure reflects the strong political support received at several levels: from the European Union, through the European Investment Bank; from France through the French Export Credit Agency BPI France, CDC, subsidy program; and from China through the Chinese Export Credit Agency Sinosure.

Luis Miguel Palancar, Head of Project Finance Europe and Asia at BBVA, explains: “The signing of this transaction represents a very landmark accomplishment in the context of our commitment to support sustainability financing and clean technologies, and reinforce our positioning of our European Project Finance franchise.”

AESC is a leading developer and manufacturer of high performance batteries with more than 16 years of track record in the industry. Incorporated and headquartered in Japan, the company has a globally diversified management team, ownership structure and production footprint with major facilities in the U.S., U.K., France, Spain, China and Japan.

BBVA is further supporting AESC and has provided a €90 million in guarantees needed by AESC Spain to secure €300 million in loans and grants from the Spanish government’s Strategic Project for Economic Recovery and Transformation programme that will be used for the construction and operation of a lithium-ion battery gigafactory in Western Spain with more than 10 gigawatt-hours nominal capacity.  

The Zero Net Emissions Banking Alliance (NZBA) has recognized BBVA's support for financing the development of battery gigafactories in France and Spain among the best cases included in the publication of the 2023 progress report on the decarbonization of its members. This document was made public on December 4 during COP28.