Shares of NOVONIX Limited (NASDAQ: NVX) are on a 24.23% rise this morning on the as of the last check, trading at $2.41 US stock charts. The announcement of a legally binding offtake agreement with PowerCo SE was followed by a spike in NVX shares. This significant agreement outlines the supply of a minimum of 32,000 tons of high-performance synthetic graphite material to PowerCo over a five-year period, beginning in 2027.
NOVONIX’s Role
PowerCo, established by Volkswagen in 2022, is dedicated to expanding global battery cell production and overseeing factory operations, advancements in cell technology, and vertical integration in the battery value chain.
PowerCo has selected gigafactory locations in St. Thomas, Canada; Valencia, Spain; and Salzgitter, Germany, with the goal of achieving a combined production capacity of up to 200 GWh per year. This partnership builds on a previous non-exclusive Testing and Development Agreement signed between NOVONIX and PowerCo in March 2024, marking the companies’ growing collaboration in the battery sector.
Strategic Production Plans in North America
With its Riverside plant, NOVONIX is establishing itself as the first sizable North American manufacturing facility specializing in high-performance synthetic graphite for the battery sector. In order to meet customer obligations, commercial production is expected to start in 2025 and increase to 20,000 tons per year (tpa). Additionally, the U.S. Department of Energy (DOE) recently awarded NVX a $100 million grant and a $103 million investment tax credit to finance the Riverside project.
Future Growth and Promises
A second plant in the southeast of the United States is being built with the intention of producing 30,000 tpa at first, with the potential to increase to 75,000 tpa. In order to finance this new facility, NOVONIX is now negotiating with the DOE Loan Program Office for financing support under the Advanced Technology Vehicles Manufacturing Program.
NVX wants to raise overall output to at least 150,000 tpa in order to meet expected client demand. The agreement’s key terms include the minimum supply commitment of 32,000 tons, with pricing terms mutually agreed upon. NOVONIX (NVX) must reach specific manufacturing and compliance benchmarks by 2027 in order to begin commercial delivery.
