U.S. car manufacturer Tesla will have to revise its plans to expand its gigafactory for electric cars in the German state of Brandenburg over concerns the new buildings would be partly located in water protection zones, newspaper Tagesspiegel reported.

The company plans to make the Grünheide plant the largest car factory in the country and turn the site into the world’s largest battery cell production plant, but the state’s environmental agency has pushed for changes to the plans, citing “insurmountable obstacles” to partial approval, according to the newspaper.

Since its inception, the project has been hailed as key to accelerating the shift to electric vehicles and improving the economic development of the region.

But it has also met resistance over environmental concerns, especially relating to the plant’s water usage in the northeastern German region around the country’s capital Berlin, which has suffered from consecutive droughts in recent years.

German law allowed the company to proceed with construction on the basis of provisional licences, in spite of outstanding questions regarding the factory’s environmental impact.

The U.S. company has in the past been critical of the slow approval processes for its plant, saying the current permit processing framework “discourages necessary investments in clean energy projects and infrastructure and makes it virtually impossible for Germany to achieve its climate targets.”

The company is now likely to revise and resubmit its battery cell production plant expansion plans, news website t-online reported. Around 11,000 employees work at Tesla’s gigafactory, which produces around 150,000 electric vehicles per year, according to the site.