Somerset Council to borrow £150m towards gigafactory work

The new battery factory near Bridgwater is expected to create 4,000 jobs

A local council is considering taking out a loan of up to £150m to invest in work linked to the UK's biggest electric car battery factory.

The owners of Jaguar Land Rover are building the £4bn plant near Bridgwater, Somerset.

Somerset Council said it needed to pay for things like infrastructure around the site and skills training.

It said it is also in talks with the government about a £55m grant towards covering its costs.

Agratas, part of the Tata Group, which also owns Jaguar Land Rover, is building the factory on an old Royal Ordnance Factory site at Puriton.

The council said its role is to make sure the £4bn investment in the factory by Agratas will benefit the whole county

The brownfield site was home to an ordnance factory for most of the 20th Century

The company is promising 4,000 jobs on the site but said there is potential for thousands more people to benefit from employment in the factory's supply chain.

Somerset Council said it plans to contribute to paying for training and skills for the future workforce of the site, linking up with local colleges and schools.

The £150m loan would allow the council to invest in these things before the factory is operational.

It said paying back the loan would be covered by the business rates the battery factory will pay in the future.

The site is already approved as a government Enterprise Zone which means the council will keep 100% of the business rates paid by companies there - normally a portion goes to central government.

Councillor Ros Wyke, executive member for economic development, said: "This is a wonderful opportunity for Somerset and the future of the economy.

"And so of course we are anxious to be part of this development which is not just for Somerset, but for the whole UK economy."

The factory will initially produce batteries for Jaguar Land Rover cars

Somerset Council is also in talks with the government about a £55m grant, which the council wouldn't have to pay back, towards the local authority's costs relating to the site.

The government grant would cover the loan repayments until business rates start being paid.

A Department for Business and Trade Spokesperson said the Agratas investment was "fantastic news for Somerset".

"We're committed to making the UK one of the very best places in the world for automotive investment and continue to work closely across central and local government to achieve this," they added.

Tata said battery production is set to begin at Puriton in 2026.

It said by the early 2030s it will contribute almost half of the projected battery manufacturing capacity required for the UK automotive sector.

The factory will produce 40GWh of battery cells annually, enough to supply approximately 500,000 passenger vehicles.

Somerset Council said more details about the £150m loan will be presented to councillors in April.