Renault Boosts Electric Car Battery Plans as French Government Ponies Up

It’s no secret that the French government wants to get homegrown electric cars zipping along the country’s roads — or that the Renault-Nissan Alliance wants to dominate the market for those cars not only in France, but also worldwide. The latest move in those two efforts comes today with the announcement that Renault and Nissan are forming a new joint venture with French government agencies to develop, build and recycle batteries for electric cars.
The state-backed French Strategic Investment Fund will contribute €125 million ($185 million) to the project, which is meant to start cranking out batteries in 2012 at a Renault plant in Flins, with production capacity targeted at 100,000 batteries per year. While the joint venture’s batteries will be “available for sale to any manufacturer,” Renault says it plans to use them mostly for an upcoming model derived from its Zoe Ze concept vehicle — a car that the company plans to launch in mid-2012 and hopes will be the biggest seller in its family of electric vehicles. Also this morning, Renault announced that it has chosen the Flins plant to produce that upcoming city car, and it’s aiming for it to make up two-thirds of its EV sales in Europe.

The French Atomic Energy Commission is also joining the venture, and according to a release from Renault this morning, the European Investment Bank is considering a loan of up to €140 million in debt financing. In all, Renault says it expects the first phase of the project to require a €600 million investment.
Renault notes in its release this morning that the new project will “have a sustainable approach to its entire operations, including developing technologies to recycle batteries on site.” But battery recycling could have an impact on more than the environment. Renault-Nissan chief Carlos Ghosn said last month, when Nissan (s NSANY) unveiled a new battery recycling joint venture, that he expects recycling and reuse in energy storage and backup power applications (secondary markets for batteries after their useful life in vehicle applications has been exhausted) to help make electric vehicles more affordable.

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Photo of Zoe Ze concept vehicle courtesy of Renault