Tesla Giga Berlin Investment Rises To $6.9B As Elon Downplays Water Impact

Tesla's projected investment towards Giga Berlin has risen to 6.9 billion dollars (5.8 billion Euros). At the same time, Elon Musk says "we are not in the desert here" responding to concerns the plant will cause water shortage in the region.

According to ZDF magazine Frontal21, Tesla’s investment towards Giga Berlin will be a whopping 6.9 billion dollars (5.8 billion euros). Tesla doesn’t usually break down its investments in detail however, a spokeswoman for the Brandenburg Ministry of Economics confirmed those numbers by saying “the order of magnitude is right”

Recently, Tesla has won a $1.2billion dollar subsidy from the EU to go towards building the world’s largest battery factory at Giga Berlin. Initially, the plant is expected to have 100GWh of annual production capacity but in the long run, the number is expected to grow to 250GWh.

It’s not yet clear if Frontal21’s 6.9billion dollar number also includes the EU’s $1.6 billion dollar subsidy or if Tesla is planning to invest that amount in addition to the EU grant. Either way, this makes Tesla’s Giga Berlin the largest industrial project in the EU.

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The first Model Y built at Giga Berlin is expected to roll off the line in 4 months’ time and ultimately the plant is expected to produce a million vehicles a year. However, Tesla is building the plant with temporary permits and the final environmental review is still underway.

Given the size and scale of the factory, there are some in the city of Brandurbug who oppose the final permit to the factory. Of their concerns, the main one is the factory’s impact on the local water supply.

For the initial phase of the project, Tesla plans to use 1.4 million cubic meters of water a year. However, in its filing Tesla has left the possibility of the plant using as much as 3.6 billion cubic meters of water annually. And opponents of the project warn this will cause water shortage as the Tesla plant will use as much water as a city of 40,000 people.

Brandenburg state, which oversees the buildout of Tesla’s Berlin Gigafactory, also seems to be aware of the potential water shortage issue. According to internal documents from the State Environment Ministry of Brandenburg which held a meeting on July 9, 2020, the state is already reaching its water capacity limits. And they believe Tesla’s settlement in the area will aggravate the situation.

However, Musk doesn’t believe fears over water shortage are well-founded. In a statement to Frontal21 Musk said “Basically, we are not in a very dry region. Trees would not grow if there was no water. I mean, we're not in the desert here.”

Brandenburg's Environment Minister Axel Vogel also seems to agree with Musk’s sentiment. In an interview with Frontal21 Vogel said "capacity limit does not mean that the capacity limit has currently been exceeded,"

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In addition to the stress the Tesla plant is feared to cause on water supply, there are also concerns over the impact the factory will have on the underground water. According to a report by "Märkische Oderzeitung" and "Berliner Zeitung", three citizens' associations demanded the interpretation of current application documents demanding clarification on how the rainwater from the roofs and paved areas of the factory should seep into the ground.

The citizens' associations pointed out that numerous residents use house wells for drinking water supply and would be affected if the groundwater flow decreases or if pollutants get there. Tesla responded to the concerns by modifying the company’s plan from a central to a decentralized concept of water infiltration.

Currently, Tesla plans to bring several breakthrough technologies to volume production for the first time at Giga Berlin. Unlike Tesla’s Nevada Gigafactory, the EV maker plans to produce the newest 4680 cells in the Berlin plant. These cells, as compared with Tesla’s 2170 batteries, have considerably higher energy density and cost significantly less to produce.

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The EV maker’s plan is to put the new battery cells made in Giga Berlin in the Model Y. This should make it a significant improvement to the version of the Model Y built-in Tesla’s Fremont California plant and Shanghai Gigafactory.

In addition to having the new 4680 cells, the vehicle is also expected to have other breakthroughs such as a structural battery, a new type of paint system that subtly changes with curvature, and a range that could be over 470 miles per charge.

So what do you think? How many cars could Tesla produce a year with a $6.9 billion investment? Also, is the concern over water supply legitimate? Or is it something that Tesla can easily handle? Let me know your thoughts down in the comments below.

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Tinsae Aregay has been following Tesla and The evolution of the EV space on a daily basis for several years. He covers everything about Tesla from the cars to Elon Musk, the energy business, and autonomy. Follow Tinsae on Twitter at @TinsaeAregay for daily Tesla news.