UK battery manufacturer AMTE Power is considering moving commercial production plans from Thurso, Scotland, to the US due to IRA incentives, Kallanish reports.

Ceo Alan Hollis said in a televised interview on Sunday that AMTE Power is a home-grown UK business, and it intends to commercialise the technology and manufacture the product in the country.

“But we have to ask the question if the subsidies are available overseas,” he adds. “In the Inflation Reduction Act, the typical support for the running costs of a gigafactory would be between 30 and 50% of the operating costs. The answer is perfectly clear where the most economic place for the gigafactory will be.”

Last month, Hollis announced the completion of a strategic business review, under which the company plans to have all tests on its three cells – Ultra Prime, Ultra Safe and Ultra High Power – completed by the end of June. AMTE Power has delivered the first batch of its Ultra Prime cells to a customer and started shipping samples of Ultra Safe to customers. Delivery of the Ultra High Power product is to follow in the second quarter.

The company currently produces the cells at its existing factory in Thurso and at contracted UKBIC facilities. It’s working on a megafactory project in Dundee, Scotland, targeting a capacity of 500 megawatt-hours/year and first production in 2026. This factory would eventually be scaled up to gigafactory capacity. However, the lack of incentives and subsidies in the UK, compared to other countries, could mean the only battery manufacturing company will take its investment abroad.

“Unless we make the UK a competitive place for battery manufacturer, we probably won’t end up with a battery manufacturing industry in the UK. And the consequences of that are clear for the automotive industry and for the energy storage sector as well,” warns Hollis.

The UK government says that instead of unveiling its own IRA response package, it’s working on a model that combines some support, market regulatory changes and investment incentives through the tax system. Chancellor Jeremy Hunt told Sky News he’s wary of the temporary benefits of subsidies, which once removed, could reveal a business isn’t sustainable; and of the dangers of moving towards protectionism.