The Chattanooga City Council on Tuesday endorsed property tax incentives for a company that has plans for a $160 million plant to develop materials for lithium-ion batteries and create 300 jobs.
Novonix, a Nova Scotia, Canada- based company that opened a smaller facility in Lookout Valley in 2019, is expected to buy and retrofit a building off Riverfront Parkway at the former Alstom site.
Charles Wood, the Chattanooga Area Chamber of Commerce's vice president for economic development, said Tuesday the opportunity for the city is "very substantial."
In addition to the planned 300 jobs retrofitting a 400,000-square-foot former turbomachinery factory on Riverfront Parkway, Novonix and its PUREgraphite subsidiary can help create critical mass for the growing electric vehicle and battery sector in Chattanooga, he said.
Wood said that Volkswagen is investing $800 million to build electric vehicles in Chattanooga and other nearby automakers are making big bets in battery-powered cars and SUVs. Also, large battery production plants are underway or planned in Tennessee and Georgia, he said.
"It puts us in a great position," he said.
A proposed Payment in Lieu of Tax (PILOT) agreement with the city and Hamilton County, which still needs to finalize the deal, would provide a property tax break for Novonix and PUREgraphite ranging from zero to 50% over 10 years. The company would pay all of the county school taxes.
The company has the option to decide when it wants to start the incentives within five years, the agreement said.
Jimmy White, whose company owns the former 121-acre Alstom site now called The Bend, said the new jobs planned by Novonix "gets my juices flowing."
"We've been very patiently waiting for the right group," he said. "It's a match made in heaven. It's a good fit. It's like Cinderella's slipper."
Daniel Deas, chief operating officer of PUREgraphite, said last week that he expected the company will be on site off Riverfront Parkway this year with work picking up in mid-2022 and up to capacity by mid-2023.
Novonix' synthetic graphite is used in making ultra-long-life, high-performance anode material for lithium-ion batteries, specifically for electric vehicles and similar storage applications, officials said.
The company's Lookout Valley plant employs about 35 people.
Wood said the company is operating in just 20,000 square feet now and is already making synthetic graphite though in much smaller quantities than planned.
Deas said last week that the company is looking at another facility in the area that could produce 30,000 tons per year of synthetic graphite and employ 1,000 workers.
Contact Mike Pare at email@example.com. Follow him on Twitter @MikePareTFP.