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Sustainable battery value chain to combat climate change

August 16, 2021

A sustainable battery value chain is one of Europe’s weapons to combat climate change, Michael Lippert, Chairman of BEPA – Batteries European Partnership Association argues

It is no secret that human actions and energy-consumption habits without restraints are among the main agents to have propelled climate change. As the globe’s average temperature increases progressively, major headlines continue to daily announce the always more impending risk of losing entire towns to fires, floods or other natural disasters.

The urgency of this situation calls for actions towards fast decarbonisation. Therefore increasing the energy supply from renewable sources is one of the most effective pathways to reaching Europe’s decarbonisation targets. Advanced battery technology is key to significantly reduce carbon emissions from both the transportation and power sectors, which jointly are responsible for about 40% of the 50Gt of the global CO2 emissions.

The newly born Batteries European Partnership Association shares a mutual objective with the European Commission: fostering battery Research and Innovation at the EU, national and regional levels as to promote the development of a more sustainable, circular and competitive European battery value chain applied to the e-mobility sector and stationary applications.

Batteries: Key to the new far-reaching EU net-zero plan

Since 11th December 2019, 27 countries have been jointly involved in a race to transform a high-carbon economy into a low-carbon one: the European Green Deal. But with country representatives and policymakers believing that a yearly pause would be needed due to the COVID-19 health crisis, the worry of international governments shifting their focus away from the EU Green Deal plan was rising. However, the European Commission has exacerbated its targets and released a more ambitious package of proposals.

At the heart of the Fit for 55 package, there is a clear need to deepen the decarbonisation efforts, especially by tackling the transportation sector. Electrification of all transport modes is key to replacing fossil fuels with clean electricity, which is bound to become the primary source of energy powering the mobility sector. Accordingly, a broader uptake of advanced technologies, like batteries, along with innovations In electric and hybrid traction chains is needed. Advanced charging infrastructures in all areas of mobility, including road transportation, off-road, waterborne, rail and aviation will be indispensable, too.

At the same time, battery energy storage — whether used in stationary systems or onboard vehicles, trains or ships — will play a pivotal role in providing more flexibility in the electricity grid as to integrate extensive quantities of renewable energy coming from variable resources, such as wind, solar or hydro. Not only do batteries store clean energy produced in excess (e.g. during low-demand times) and release it for later use (e.g. during peak times), but they are also perfectly suited to support the supply-demand balance of the power system, they help manage grid congestion, and optimise energy usage – and CO2 emissions – at the end-user’s level.

Batteries have, indeed, gained traction across European countries committed to curbing CO2 emissions: by 2030 the mobility sector will represent over 80% of the demand for rechargeable batteries, providing a strong incentive for the lithium-ion battery sector growth. The resulting economies of scale and technology developments are also triggering a snowballing development of the stationary battery sector. Evolving regulations and new business models contribute to making energy storage economically viable in a growing number of applications; consequently, the market witnesses a double-digit growth rate.

“Advanced battery technology is key to significantly reduce carbon emissions from both the transportation and power sectors, which jointly are responsible for about 40% of the 50Gt of the global CO2 emissions.”

Challenges for the European battery value chain

In the upcoming years, the Asia-Pacific regions are expected to remain the leaders in the lithium-ion battery market – and their slice is estimated to reach $6.01 billion in 2025, accounting for 54% of the global market value. (1) With a cumulative capacity installed on the rise, Europe must face the competition to reach a climate-neutral economy by 2050.

“It is no secret that human actions and energy- consumption habits without restraints are among the main agents to have propelled climate change.”

Given the fundamental role that batteries play in transitioning to a more sustainable economy, Europe must no longer be dependent on its competitors, but rather plant the seeds for a florid in-house manufacturing environment. Upscaling the number and size of industrial facilities across Europe would facilitate the increase of both manufacturing and recycling capacities locally. As a result, consumption of batteries would be close to the point of production, which will allow for better control of sustainability and price along the entire value chain.

Europe must take a leading role in battery technology innovation: only by fostering an innovation ecosystem that covers the whole value-chain, the EU will be able to create best-in-class “Made in Europe” batteries at lower costs and with lower ecological footprints.

However, strictly linked to this first challenge, there is the regulatory one: a more consistent policy framework across all states remains of the essence to modernise the general grid and facilitate the industrial upscale. For example, the recent proposal of a Sustainable Batteries EU regulation can foster a more competitive battery value-chain in Europe based on sustainability and circularity, making sure that the environmental performance of European batteries does constitute a distinguishing factor in terms of global competitiveness.

Endorsing the European recovery towards a thriving battery value-chain

Addressing the challenges that still prevent Europe from becoming the leading country in sustainable and circularity practices requires a planned series of strategic actions.

Under the BATT4EU co-Programmed partnership, the EU and the European battery industry and research communities (united under BEPA) are boosting European battery research and contributing to the creation of a top-notch innovation ecosystem for batteries.

The members of BEPA aim to trigger advancements in the creation of a competitive, sustainable, and circular European battery value-chain by providing inputs and recommendations to the European Commission.

Joining forces, indeed, will allow for easier contribution to the identification of priorities of research and innovation activities and the definition of battery call topics to be included in the Horizon Europe Work Programmes.

Coming out stronger from the recent times of crisis and transformation, Europe is the first mover pushing on its 2050 goal of achieving net-zero emissions and building a flourishing European battery chain in favour of the plan.

Batteries in Europe: Policy focus

In the view of Vice-President Maroš Šefčovič, batteries deliver on the twin green and digital transition, preserve the competitiveness of the European industry and achieve open strategic autonomy. the launch of the Battery Alliance in 2017, “Europe has become a global battery hub, and is well on track to achieve open strategic autonomy in this critical sector,” Šefčovič explained on 22nd March 2021.
The best progress in the battery cells segment has been made, Šefčovic added on the same day. He pointed out that to a large extent, Europe’s announced lithium cell projects will cater for domestic demand for batteries by 2025, driven by e-mobility. However, much remains to be done and as such, the Commission aims to speed progress with its policy initiatives, including the Smart and Sustainable Mobility Strategy, a proposal for a new batteries regulation plus the Critical Raw Materials Action Plan. (2)
The last word goes to Šefčovič himself, who gave optimism for the future of the industry, despite the COVID-19 pandemic during remarks he made on 12th March 2021. “Despite the pandemic, Europe continues to be a battery hotspot, closing the investment gap to our major Asian competitors, and in moving fast towards its open strategic autonomy in this critical sector,” Šefčovic pointed out in an earlier speech on 12th March 2021. (3)

The above facts were compiled by the Editor of Open Access Government.