Germany Gives Tesla Conditional Approval to Build $5.5Bn Gigafactory

Photo credit: AFP

The German state of Brandenburg gave Tesla, the world’s biggest EV manufacturer, a conditional go-ahead for its $5.5bn landmark gigafactory near Berlin.

This has put an end to the months of delay for the plant’s project, which is crucial to Tesla chief executive Elon Musk’s ambitions to vanquish European market leader Volkswagen, which was initially supposed to open last summer.

Pointing that the Tesla plant – that will also include a battery plant capable of generating more than 50-gigawatt hours per year – would be a major industrial and technological driver for the region and Germany, Brandenburg state premier Dietmar Woidke said that the development marks a big step into the future.

German unions said last month that about 2,600 people have been hired so far of the factory’s expected 12,000 workers and Tesla tries to lower waiting times and costs by negotiating with numerous regional parts suppliers to source as much as possible locally.

The conditional building permit does not allow the US-based EV pioneer to start right away the production of the 500,000 battery-powered vehicles it wants to produce each year since it must first fulfill numerous conditions, including in water use and air pollution control.

After the environmental groups had challenged the license given to a local water utility to supply the Tesla site in the small community of Gruenheide, the site’s water supply issue emerged late on Friday when a Frankfurt Oder administrative court sided with the legal challenge.

The court, however, left an open door for the water supply arrangement to be salvaged noting that the procedural errors made in the licensing decision could be remedied by the water utility. Only by solving this issue will Tesla get its long-awaited operating permit.

According to Brandenburg’s environment minister Axel Vogel, Tesla plans to meet the imposed conditions within the next two weeks.

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