Potential £18.3m boost for Teesside lithium plant

By the Editorial Team · Friday, September 18, 2026

The UK government has proposed an £18.3 million grant to support Alkemy Capital Investments’ development of a lithium hydroxide processing plant at Teesside, aimed at producing battery-grade materials for electric vehicles. This investment is expected to enhance the domestic supply chain for critical minerals, contribute over £2 billion to the economy, and create hundreds of jobs while advancing the UK’s goal of securing sustainable battery production capacity by 2035.

The UK government has offered a potential £18.3 million boost to support the development of a lithium processing plant on Teesside, aimed at supplying a crucial component for electric vehicle batteries. Alkemy Capital Investments, the parent company of Tees Valley Lithium Ltd, revealed the offer in principle through the government’s DRIVE35 Automotive Transformation Fund.

The proposed £185 million facility at the Billingham Chemical Complex is intended to produce battery-grade lithium hydroxide monohydrate, initially targeting an output of 25,000 tonnes per year. This volume could supply enough material for over half a million electric vehicles. The project envisions scaling production to 100,000 tonnes annually in the longer term.

Tees Valley Lithium estimates that the refinery will contribute approximately £2.1 billion to the UK economy over a 25-year period, with around half of this impact concentrated in the Tees Valley region. The company anticipates the creation of 66 permanent direct jobs, 517 roles across the supply chain, and approximately 1,100 positions during the construction phase.

Vikki Jeckell, CEO of Tees Valley Lithium, described the grant as a strong endorsement of the Teesside region’s industrial capabilities. She highlighted existing partnerships with major global companies such as Glencore and Veolia, which have already committed to the project. Jeckell emphasized the alignment of the initiative with the UK government’s Critical Minerals Strategy, which aims to establish domestic lithium refining capacity to meet growing demand for electric vehicle components. She noted that the first phase of the project alone would deliver nearly half of the lithium refining capacity targeted for 2035.

The financial support from the DRIVE35 fund underscores the UK’s efforts to strengthen its domestic supply chain for critical minerals, which are vital to its ambitions in electric vehicle manufacturing and broader green technologies. The development in Billingham represents a significant step toward reducing reliance on imports and fostering a sustainable industrial base in battery materials.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.