LONDON (ShareCast) - (Sharecast News) - Energy storage and clean fuel technology company ITM Power has agreed heads of terms to acquire a site for its second UK factory in Tinsley, Sheffield, from the University of Sheffield, it announced on Tuesday, at a cost of £13.4m.
The AIM-traded firm said the site was part of the university's 'Innovation District', close to the M1 motorway and public transport links.

It was about two miles from the group's existing 'Gigafactory' and technology centre at Bessemer Park.

The company said the land had outline planning consent and a full design brief agreed with Sheffield City Council, with the acquisition subject to the grant of full planning permission for the new factory.

As set out at its recent fundraise, ITM was intending to build a second automated factory of around 260,000 square feet on the site, with a capacity of 1.5 GW per annum, and was expecting to be fully operational by the end of 2023 to complement its existing 1 GW per annum capacity at Bessemer Park.

The new factory would provide the template for the group's first international facility, which was expected to have a capacity of 2.5 GW per annum, and was anticipated to bring total group electrolyser capacity to 5 GW per annum by the end of 2024.

One of the key features of the second UK factory, the board said, would be an enlarged power supply to test multiple modules of the firm's next-generation product concurrently.

The overall cost of the new Sheffield factory was expected to be in the region of £50m to £55m.

In addition to the land cost of £13.4m, ITM Power said it was currently allocating up to £16m for the construction of the shell, and a further £20m to £25m for the fit-out and power supply.

The new factory would also include office space for manufacturing staff, and would be a low environmental impact building, using the best of current low carbon technologies.

ITM Power said it would work closely with a developer, to be appointed once planning permission was received, to incorporate low carbon footprint materials and facilities.

"I am delighted to be working more closely with the University of Sheffield and delighted that our second UK factory site is in Sheffield," said chief executive officer Graham Cooley.

"Both initiatives will support the local economy through job creation and supply chain support."

Dr Cooley said the planning and construction of the company second, 1.5 GW capacity, factory was the "next step" on delivering its strategic plan to create a blueprint for an automated PEM electrolyser manufacturing facility, to be rolled out internationally.

"At the same time, we are also focussed on increasing utilisation and throughput at our Bessemer Park Gigafactory as we prepare for the next step change in capacity."

At 1031 GMT, shares in ITM Power were up 3.11% at 494.84p.

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