Japanese carmaker Nissan confirmed on Thursday its plans to build a battery gigafactory in the UK and electrify its Sunderland car plant, Kallanish reports.

After “lengthy discussions” and strong speculation, the company unveils a £1 billion ($1.37 billion) investment plan to create an EV hub in the North East of England with partners Envision AESC and the Sunderland City Council. The project has three fronts: electric vehicles manufacturing, renewables generation and battery production.

Nissan will invest £423 million to produce a new-generation BEV crossover in the UK, targeting an initial production of 100,000 units/year. The model will be exported to European markets and should “make the switch to electric driving even more accessible,” the company says. The vehicles will be built on the Alliance CMF-EV platform.

Envision will allocate £450m to build an initial 9 gigawatts-hour battery gigafactory – the UK’s first on the International Advanced Manufacturing Park (IAMP), adjacent to the Nissan plant. The gigafactory will produce new Gen5 battery cells, which feature 30% higher energy density.

The Sunderland City Council will inject some £80m in a project to supply renewable electricity to the battery manufacturing process. The so-called Microgrid project is set to integrate 10 solar farms generating 132 megawatts of power. It also includes a 1-MW battery storage system using second-life Nissan EV/Envision AESC batteries.

“This is a landmark day for Nissan, our partners, the UK and the automotive industry as a whole,” comments Nissan’s cfo Ashwani Gupta. “We reached a new frontier with the Nissan Leaf, the world’s first mass-market all-electric vehicle. Now, with our partners, Nissan will pioneer the next phase of the automotive industry as we accelerate towards full electrification and carbon neutrality.”

The combined investment, which is set to grow with future market demand, was welcomed by UK Prime Minister Boris Johnson, who described it as a “pivotal moment” in the country’s EV revolution. “Nissan’s announcement to build its new-generation all-electric vehicle in Sunderland, alongside a new gigafactory from Envision AESC, is a major vote of confidence in the UK and our highly-skilled workers in the North East,” he adds.

Lei Zhang, ceo of Envision Group reveals that “growth in demand could bring future investment of up to £1.8 billion, additional capacity of 25 GWh and 4,500 jobs by 2030.” This would put the North East at the heart of a new EV hub in the UK, collaborating on R&D around the entire battery lifecycle, from storage, to second-life use, vehicle-to-grid smart charging and closed loop recycling, he adds. Envision believes the site has potential for a 35 GWh/y capacity.