Chris Woodyard

USA TODAY

Tesla Motors and Nevada made it official on Thursday evening: the electric car company's highly sought battery "Gigafactory" and its projected 6,500 jobs are coming to the Reno area.

Mutual congratulations between the electric-car maker and Silver State officials aside, the news of the announcement event in Carson City was the huge incentives the state will have to contribute to seal its end of the proposed deal: a package estimated to be worth $1.25 billion over 20 years.

Tesla CEO Elon Musk told the crowd that as huge as it is, Nevada didn't offer the biggest incentive package among the five competing states that were finalists for the plant. "This is not just about the incentives," he said.

He also said the plant, which will be built in the shape of a diamond to make construction easier, will produce its own energy and serve as a model for the community. Building the plant is expected to cost $4 billion to $5 billion.

In his prepared remarks, Musk thanked the "leadership" of Nevada Gov. Brian Sandoval and called his battery plant "an important step in advancing the cause of sustainable transportation" that will "enable the mass production of compelling electric vehicles for decades to come."

Sandoval projects that the Tesla plant -- which aims to build automotive-grade lithium-ion batteries on a huge scale and bring down their cost -- will deliver a nearly $100 billion in economic impact to Nevada over the next 20 years.

He hailed Tesla and its CEO, Elon Musk, for making Nevada their choice.

"I am grateful that Elon Musk and Tesla saw the promise in Nevada," Sandoval, a Republican, said in a statement. "These 21st century pioneers, fueled with innovation and desire, are emboldened by the promise of Nevada to change the world."

The huge package now proposed will need approval from Nevada's legislature, which is expected to be called into special session as early as next week.

Assembly Speaker Marilyn Kirkpatrick sounded a more cautious but still optimistic tone in a statement, saying she wants more details. She said she looks "forward to receiving the necessary information so the Legislature can meet and take necessary action to support this major industry coming to Nevada."

Last week, California's legislature let die a bi-partisan bill that would have offered big incentives to Tesla to locate the Gigafactory in the Golden State. Along with California and Nevada, finalists for the project also included Arizona, New Mexico and Texas as finalists for Tesla's project.

Tesla has already started grading on the site outside of Reno, but until Thursday, the electric carmaker had declined to name it as the official site of the Gigafactory.