Queensland Premier Annastacia Palaszczuk has thrown her support behind a proposal to build a Tesla-style battery factory in Townsville.

Ms Palaszczuk said on Thursday she backed a Boston Energy-led consortium plan to build the $US1.6 billion ($A2.0 billion) lithium-ion manufacturing plant in the city.

“As part of our powering Queensland plan, I would like to see a battery factory established,” she said.

The Townsville City Council signed an memorandum of understanding with Boston Energy and Innovation chairman Bill Moss in April to investigate the financial viability of building the 15-gigawatt-hour battery plant.

This was followed in June by the council’s offer of land at the former CSIRO Lansdown research station south of Townsville in exchange for equity in the project.

“We have to make sure we keep the momentum going behind our negotiations and the fact we now have a suitable site is a big step forward,” Townsville Mayor Jenny Hill said at the time.

“The battery plant has the potential to create enormous economic benefits for the city and we are doing all we can to make it stack up.”

Boston Energy claims the plant will be able to produce up to one million home battery units or 250,000 car batteries once at full production.

The consortium includes ASX Listed Magnis Resources and is backed by US companies Eastman Kodak, C4V and C&D Assembly.

It is estimated the factory would create thousands of jobs.

-AAP