The 25,000m2 facility will be operational in early 2012 with an initial annual production capacity of 60,000 units and will supply batteries for both Nissan and Renault electric vehicles.

Representing an investment of €242 million (£210 million), the plant is expected to create 200 new Nissan jobs and a further 600 across the UK supply chain.

Renault-Nissan has previously announced that a second battery facility will be located in Cacia, Portugal and has also announced plans to produce batteries at Renault’s Flins plant in France.

Last month, Nissan confirmed that Sunderland will also become a production location for the Nissan Leaf electric vehicle, said to be the world’s first affordable mass-produced zero-emission vehicle. The new vehicle will be produced alongside the recently unveiled JUKE compact crossover car, which enters production in August 2010.

Speaking at the battery plant groundbreaking ceremony, Toshiyuki Shiga, chief operating officer of Nissan, commented: 'Europe will play a key role in the Alliance’s global commitment to offer an emission-free future for road transport, and today marks another important step towards that goal.

'When operational, the battery plants in both Sunderland and Portugal will support the launch of zero-emission electric vehicles across Europe on an unprecedented scale.'