European action plan to accelerate growth of battery value chain


The EU-supported European Battery Alliance (EBA) will roll out a newly updated action plan to enable 90% of the Union’s demand for batteries to be met with domestically made products by 2030.

By 2021, €127 billion (US$138.7 billion) had already been invested into developing a battery manufacturing value chain in Europe, driven forwards by the Alliance, which was formed in 2017 to address the “industrial challenge” ahead.

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

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

The Alliance features more than 750 industrial and innovation groups in the membership of its industrial workstream, called EBA250. More than 180 industrial battery projects are in 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 more than €20 billion, as well as close to €1 billion being committed to research projects under the EU’s Horizon Europe research programme to 2027. 

In common with the US, batteries have been identified as an important part of Europe’s energy future, particularly for increasing adoption of electric vehicles (EVs) and of renewable energy through stationary energy storage for some time. 

More recent events such as the COVID-19 pandemic, which has wreaked havoc on supply chains and pushed up costs of the international transportation and import of battery materials and finished goods, the invasion of Ukraine by Russia and ongoing electricity price spikes, have reinforced that importance.

US President Joe Biden’s latest strategic move in that regard has been to call on 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 EU innovation accelerator programme EIT InnoEnergy has identified gaps that still must be addressed.

While significant progress has undoubtedly been made, those gaps in the upstream and downstream segments of the industry, as well as in skilling up the workforce need to be filled to create what EBA250 called a “resilient end-to-end battery industry”. 

In the upstream, that means resolving concerns around the mining of domestic raw materials as well as processing, refining and producing active battery grade materials, downstream the concerns are around recycling end-of-life batteries and manufacturing scrap as well as reintroducing materials recycled into the value chain. 

At the recent meeting, it was agreed that among immediate priority actions that need to be taken are the rapid adoption of EU battery regulation laws, which will gradually introduce things like carbon footprint labelling and recycled content requirements on batteries made and sold in the EU.

The regulation is currently at the stage of being negotiated with individual EU Member State countries to figure out how it will be implemented across the different regions of the common market. The EBA has said sustainability can be an important aspect of competitiveness for European battery companies. 

The regulation, including a ‘battery passport’ which will allow for tracking of devices and materials should have ambitious and stringent provisions, the group’s members have agreed. On a related note, trade association Flow Batteries Europe said that battery technologies such as flow batteries which don’t have internal storage are excluded from the passport as things stand and advocated for their inclusion.

There should also be legislation adopted to put batteries at the heart of EU decarbonisation plans, both in transport decarbonisation with EVs and renewables adoption, while measures to support and de-risk investments in raw and processed battery materials also need to be put in place, EBA said. 

The European Strategic Action Plan on Batteries, published last in 2018, will require an update, setting out new objectives — the 2018 plan stretched to 2025, while the update will take the continent to 2030. 

Among new ambitions and objectives 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 cell manufacturing from within the continent. The expected value created will shoot up sharply from €250 billion a year by 2025, to €625 billion per year by 2030, with Europe aiming to be capable of supporting 1TWh of demand across mobility, energy storage system (ESS) and other sectors by then. 

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