Quebec Looses Hundreds of Millions (Again) In Failed Clean Energy Project

After failing to find a serious buyer, Quebec announced earlier this week they were no longer providing financial support toward the Northvolt battery plant project. In addition to well over $1 billion(USD) in government incentives, Quebec turned over $512 million(USD) in loans and investment capital, much of which will not be recovered.

In addition to Quebec’s pension fund loosing all of its $145 million(USD) investment, Quebec’s Minister of Economics, Innovation and Energy announced that the provincial government’s $145 million(USD) invested into Northvolt AB, Northvolt North America’s parent company, can not be recovered. However, government officials believe they can recoup the $170 million(USD) provided in loans. Quebec’s Auditor General has already launched an investigation into how the subsidies provided by Quebec were spent. A report is expected in the spring of 2026.

Critics of Quebec’s ruling party, the Coalition Avenir Québec (CAQ), and its Prime Minister, Francois Legaultt, doubt that any of the $170 million(USD) loan amount would be recovered. However, those within the CAQ government point to millions in cash reserves within Northvolt bank accounts as well as the massive parcel of land Northvolt purchased using the loan.

Northvolt AB, filed for bankruptcy last March but announced at the time that the proceedings would not effect their North American subsidiary or plans for the Quebec battery factory; another promise Northvolt was unable to keep.

The battery technology and manufacturing conglomerate had operated across Europe and throughout the battery supply chain. At the time of their bankruptcy announcement, they had at least five thousand employees.

When the Quebec project was first approved, environmental advocates protested that the provincial government had purposefully changed regulations right before Northvolt made their proposal. Because of the adopted change, A project of Northvolt’s size no longer required an independent environmental review be conducted.

Quebec’s Minister of the Environment had pushed back at the time, arguing that the regulation change and timing of Northvolt’s proposal were unrelated and also that the climate crisis justified not having an environmental review done. Critics argued that a review would have taken about seven months and could have been conducted alongside the factory’s construction in order to, at the very least, develop proposals to offset damage caused by the construction of a factory large enough to cover 318 football fields.

The Northvolt boondoggle is just the latest example of a Quebec funded clean energy project to either be postponed or abandoned entirely.

Lion Electric Company’s bankruptcy also made headlines recently, including within Maine. Manufacturer of electric minibuses and electric commercial box trucks, Lion Electric Co. is best known for there electric powered school buses. Spurned by Quebec’s high carbon reduction mandates as well as incentive programs under the Biden administration, school districts across Quebec and the United States purchased thousands of these electric school buses.

Unfortunately for many of those school districts, many of Lion’s buses were lemons from the start. School districts across the country, including both Winthrop and Yarmouth school districts here in Maine, found themselves with buses that spent most of their time broken down and waiting for repairs.

Quebec province had invested over $100 million(USD) into Lion Electric before it filed for bankruptcy last December. The company was saved by private investors but on a severely reduced scale and focused solely on school buses in Quebec only. The corporate restructuring also permitted the new and improved Lion Electric to void all warranties to the school busses sold in the United States.

The Ford Motor Company, in partnership with South Korean companies ECO Pro BM and SK On, announced in 2023 they would construct a battery plant for Ford’s EV models in Becancour, Quebec. The Canadian federal government and the Province of Quebec each invested $233 million(USD) into the project. After having to pause construction multiple times and reevaluating the EV market, Ford decided to pull out of the partnership last year. ECO Pro has insisted that the project will continue, however construction was paused this past June with no re-start timeline announced.

At least $100 million(USD) was invested into a joint venture between General Motors and South Korea’s Posco Future M. Another EV battery factory, the plant would provide batteries for GM’s EV production lines. The initial fall 2024 completion date was pushed back when construction was paused due to “local conditions”, according to POSCO. By March 2025, construction had resumed and both GM and POSCO re-asserted their intent to be in production by early 2026.

However, over the past few days reports of GM re-assessing their EV plans has brought bad news for several GM plants tied to their EV production lines. A Chevy Bolt plant in Kansas City is not adding a 2^nd shift as planned, an electric Cadillac SUV plant in Tennessee has announced temporary shutdowns over the next few months and an electric vehicle plant in Michigan has been shut down until at least October. Additionally, an electric delivery van plant in Ontario will cease there 2^nd shift and lay-off 450 employees. It is not clear how these recent changes in GM’s electric vehicle expectations will effect their nearly complete EV battery plant in Quebec.

–TMP

SOURCES

Manufacturing the greenest batteries in the world in Quebec

EV battery giant Northvolt to build multibillion-dollar plant in Quebec

Rule change paving way for controversial Northvolt EV battery plant raises transparency concerns in Quebec

Quebec declares Northvolt battery plant partnership dead, loses $270M investment

QUEBEC ENDS THE PROJECT WITH NORTHVOLT

Six potential buyers lacked seriousness

Lyten to Acquire All Remaining Northvolt Assets in Sweden and Germany

Quebec auditor general probes subsidies to embattled electric battery industry

Statement from Christine Frechette on Not Funding Lion Electric Anymore

Previous Lion Electric School Bus Warranties Voided by Company Sale