Value chain

European action plan to accelerate the growth of the battery value chain

The EU-backed European Battery Alliance (EBA) will roll out a newly updated action plan to help meet 90% of the EU’s battery demand with made-in-country products. 2030.

By 2021, 127 billion euros ($138.7 billion) had already been invested in the development of a battery manufacturing value chain in Europe, driven by the Alliance, which was formed in 2017 to raise the “industrial challenge” to come.

However, to create a self-sufficient battery industry by 2030, €382 billion of additional investment will be needed, the EBA said following a high-level industry meeting it held just before the end of March.

Once established, the market opportunity for the European battery industry could be around €250 billion per year by 2025.

The Alliance has more than 750 industry and innovation groups as members of its industry working group, called EBA250. More than 180 industrial battery projects are under development in the European Union, including 47 battery cell projects.

Support mechanisms in place include the designation of battery projects with Important Project of Common European Interest (IPCEI) status worth over €20 billion, as well as nearly €1 billion engaged in research projects under the EU research program Horizon Europe until 2027.

Similar to the United States, batteries have been identified as an important part of Europe’s energy future, particularly for the growing adoption of electric vehicles (EVs) and renewable energy via energy storage. stationary energy for some time.

More recent events such as the COVID-19 pandemic, which has wreaked havoc on supply chains and driven up the costs of international transport and import of battery materials and finished products, the invasion of Ukraine by Russia and the continued spikes in electricity prices, have reinforced this. importance.

US President Joe Biden’s latest strategic move in this regard has been to use the Nation’s Defense Act to rally support for his country’s domestic value chain development.

Updated action plan

The European Battery Alliance, led by European Commission Vice-President Maroš Šefčovič and coordinated by the European innovation acceleration program EIT InnoEnergy, has identified gaps that still need to be filled.

Although significant progress has undoubtedly been made, these gaps in the upstream and downstream segments of the industry, as well as in the qualification of the workforce, must be closed to create what the EBA250 called a “resilient end-to-end battery industry”.

Upstream, it means solving the problems related to the extraction of domestic raw materials as well as the processing, refining and production of battery-grade active materials, downstream, the problems concern the recycling of end-of-life batteries and manufacturing waste as well as the reintroduction of recycled materials into the value chain.

At the recent meeting, it was agreed that among the immediate priority actions to be taken are the rapid adoption of European laws on battery regulation, which will gradually introduce elements such as carbon footprint labeling and requirements for recycled content on batteries manufactured and sold in the EU.

The regulation is currently being negotiated with individual EU member states to determine how it will be implemented in different regions of the common market. The EBA said sustainability can be an important aspect of the competitiveness of European battery companies.

The regulations, including a “battery passport” that will allow the tracking of devices and materials, should contain ambitious and strict provisions, group members agreed. On a related note, the trade association Flow Batteries Europe said that battery technologies such as flow batteries that have no internal storage are excluded from the passport as it stands and advocated for their inclusion. .

Legislation should also be adopted to place batteries at the heart of EU decarbonisation plans, both in the decarbonisation of transport with the adoption of electric vehicles and renewable energies, while measures to support and to reduce the risks of investments in raw and processed battery materials also need to be put in place, the EBA said.

The European Strategic Action Plan on Batteries, last published in 2018, will need an update, setting new targets – the 2018 plan extends to 2025, while the update will bring the continent until 2030.

Among the new ambitions and targets expected for the new plan will be 100% domestic recycling coverage in the EU, sourcing 40% of active materials used in EU manufacturing domestically and covering 90% of manufacturing cells from the mainland. The expected value created will increase sharply, from €250 billion per year by 2025 to €625 billion per year by 2030, with Europe aiming to be able to meet 1 TWh of demand in mobility , energy storage systems (ESS) and other sectors by then.