News: £28m battery company project falls flat, millions of public money lost
A £28m investment project to create a manufacturing base for a new type of battery in South Yorkshire appears to have died - a long with the 500 promised jobs and millions of pounds in public sector loans and grants.
Rothbiz reported in 2023 that Rotherham was confirmed as the location for the Ultimate Battery Company's (UBC's) first manufacturing plant and innovation centre, set to create 495 highly skilled jobs by early 2026.
The announcement followed on from the South Yorkshire Mayoral Combined Authority (SYMCA) agreeing to support the private company with £5.2m in loans and grants.
Premises at Thurcroft were identified and recruitment got underway.
Now the same New Orchard Lane property is back on the market to rent with agents, CPR, and the Ultimate Battery Company has switched its address back to Manchester with Companies House.
SYMCA pledged financial support to enable the firm to set up a new research and development centre and manufacturing facility in the region to develop lighter, more energy dense batteries for the automotive sector. Boards were told that it would create 495 new jobs.
UBC aims to deliver a new battery that provides Lithium-like performance at 35% of the cost, enables twice the energy to be stored in the same physical space and provides a faster charging rate. These batteries would significantly reduce weight by up to 15Kg per vehicle, driving down CO2 emissions and manufacturing costs, while increasing energy densities.
Now it is clear that specific loans to local entities have been written-off, with the likelihood that SYMCA will not be repaid.
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A SYMCA audit report shows that a loan of £3.2m to the Ultimate Battery Company (UBC), supported by a Gainshare funding grant of £2m, has been written off.
Using devolved government money, the South Yorkshire Gainshare funding has been designed to support both place-based investment plans, and key thematic areas that aim to deliver the stronger, fairer and greener policy objectives outlined within economic plans.
The report states: "At a programme level, direct investments into businesses in the strategically important sector of advanced manufacturing were expected to enable both the growth of indigenous businesses and attract inward investment by supporting businesses from outside of the region to establish themselves in South Yorkshire."
The loan to UBC was evaluated by SYMCA under its assurance framework and deemed to be well aligned to the plans. However, due to issues encountered by the projects, the company has since ceased trading without the repayment of loans to the authority.
The report talks of the "subsequent unrecoverable nature" of the loan so SYMCA engaged an independent consultant to inform the national evaluator's Gateway Review of these investments.
The report adds: "This review resulted in a number of key lessons learned being identified and an action plan is currently underway and will be published once the Final Review Report has been received. We note that the external consultant did note that the business case process followed for these investments was deemed to be fit for purpose and the issues and difficulties experienced by these companies could not have been foreseen. We have therefore not identified a significant weakness in governance arrangements in relation to the circumstances of these loan write-offs and will follow up on the resulting action plan as part of our 2024-25 review of arrangements."
Ultimate Battery Company website
SYMCA website
Images: CPR
Rothbiz reported in 2023 that Rotherham was confirmed as the location for the Ultimate Battery Company's (UBC's) first manufacturing plant and innovation centre, set to create 495 highly skilled jobs by early 2026.
The announcement followed on from the South Yorkshire Mayoral Combined Authority (SYMCA) agreeing to support the private company with £5.2m in loans and grants.
Premises at Thurcroft were identified and recruitment got underway.
Now the same New Orchard Lane property is back on the market to rent with agents, CPR, and the Ultimate Battery Company has switched its address back to Manchester with Companies House.
SYMCA pledged financial support to enable the firm to set up a new research and development centre and manufacturing facility in the region to develop lighter, more energy dense batteries for the automotive sector. Boards were told that it would create 495 new jobs.
UBC aims to deliver a new battery that provides Lithium-like performance at 35% of the cost, enables twice the energy to be stored in the same physical space and provides a faster charging rate. These batteries would significantly reduce weight by up to 15Kg per vehicle, driving down CO2 emissions and manufacturing costs, while increasing energy densities.
Now it is clear that specific loans to local entities have been written-off, with the likelihood that SYMCA will not be repaid.
Advertisement
A SYMCA audit report shows that a loan of £3.2m to the Ultimate Battery Company (UBC), supported by a Gainshare funding grant of £2m, has been written off.
Using devolved government money, the South Yorkshire Gainshare funding has been designed to support both place-based investment plans, and key thematic areas that aim to deliver the stronger, fairer and greener policy objectives outlined within economic plans.
The report states: "At a programme level, direct investments into businesses in the strategically important sector of advanced manufacturing were expected to enable both the growth of indigenous businesses and attract inward investment by supporting businesses from outside of the region to establish themselves in South Yorkshire."
The loan to UBC was evaluated by SYMCA under its assurance framework and deemed to be well aligned to the plans. However, due to issues encountered by the projects, the company has since ceased trading without the repayment of loans to the authority.
The report talks of the "subsequent unrecoverable nature" of the loan so SYMCA engaged an independent consultant to inform the national evaluator's Gateway Review of these investments.
The report adds: "This review resulted in a number of key lessons learned being identified and an action plan is currently underway and will be published once the Final Review Report has been received. We note that the external consultant did note that the business case process followed for these investments was deemed to be fit for purpose and the issues and difficulties experienced by these companies could not have been foreseen. We have therefore not identified a significant weakness in governance arrangements in relation to the circumstances of these loan write-offs and will follow up on the resulting action plan as part of our 2024-25 review of arrangements."
Ultimate Battery Company website
SYMCA website
Images: CPR
4 comments:
Another Coppard masterclass in how to lose money
Small change compared to the millions every year they going to commit to reopen the white elephant airport that only a tiny minority will use(if it even gets passenger flights)yet it was steam rollered through!
Why do some blame the local governance when it clearly is the private sector that has experienced the difficulties? As usual profit is privatised whilst debt is socialised. :(
Still a viable company why are they not chasing the money from the multi millionaire ceo?...or as it already been shared out.
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