Feds have spent at least $530 million on NextStar battery plant: documents
CBC
The federal government has paid out at least $530 million in incentives to NextStar Energy, the company behind a major battery plant in Windsor, Ont., records show.
It’s a relatively small portion of the billion-dollar funding deals with NextStar, which is a joint venture between global automaker Stellantis and South Korean battery firm LG Energy Solution. The federal government is providing up to $10.5 billion, while the province has pledged up to $5.5 billion.
Still, the figure provides fresh insight into the financial and contractual relationships between the federal government and NextStar — relationships that have been the focus of intense scrutiny since Stellantis announced it's moving production of a Jeep model from its Brampton facility to the U.S.
Federal officials have linked the NextStar deals to job guarantees at the Brampton assembly plant, and indicated that they could seek to recoup some of the tax dollars Stellantis has received over the years as part of the agreements.
The federal government has two funding agreements with NextStar directly. CBC Windsor revealed redacted copies of the multi-year contracts last month.
Both deals show NextStar — located in the city with Canada's highest unemployment rate — has agreed to hire 2,500 full-time employees and to provide other economic benefits in exchange for the funding.
Now, an analysis of new public accounting documents shows how much the federal government has actually spent so far.
The first agreement, inked in 2022, is for up to $500 million through a federal program known as the Strategic Innovation Fund that's administered by the industry department.
Earlier this month, the government released a yearly — and voluminous — accounting document known as the Public Accounts of Canada, which details federal spending over the past fiscal year.
That document, as well as the one for the year prior, show that federal authorities have dispersed at least $490 million of the $500 million pledged to NextStar — a number confirmed by the industry department.
The department previously said the SIF funding was for capital expenses related to the construction of the plant, so "a significant amount of Canada’s portion of that funding" had been spent.
NextStar broke ground on the project in 2022 and announced this past September that it had officially completed the construction phase.
Ontario's government is also providing up to $500 million in capital investment to NextStar, but it's unclear how much of that has been spent yet. A spokesperson for Premier Doug Ford previously declined to answer questions about how much the province has paid the company so far.
The second federal agreement, signed in 2023, is for up to $15 billion in production subsidies — with one third of that amount to be paid by the province.
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