Vattenfall is investing Skr5m (€525,000) in Northvolt, which is building Europe’s largest lithium battery factory in Sweden.
The factory aims to supply the energy storage and transport sectors, Vattenfall said.
Construction is planned to start during the second half of 2018, with production scheduled from the end of 2020.
Vattenfall will own a minor share in Northvolt, with the Swedish Energy Agency and the Swedish public innovation agency Vinnova also providing finance for the project.
Vattenfall head of strategy and member of the Northvolt advisory board Andreas Regnell said: “Vattenfall has a clear strategy of supporting the energy transition and climate-smart solutions.
“Electricity storage will be a significant factor in the transition, mostly in the transport sector and also the energy system at large.”
InnoEnergy, which promotes innovation in sustainable industries, has also invested €3.5m in the Northvolt factory project.