The European Commission released a report on the implementation of the Strategic Action Plan on Batteries, which was approved in May 2018. The purpose of this report is to review progress in the implementation of a coordinated EU policy on overcoming the dependence on the import of batteries and technological backwardness from key competitors in East Asia.

 

According to the document, the main factor in the development of the European battery market is the projected estimates of the increase in the number of electric cars in the world from 4 million units in 2019 to 50-200 million in 2028 and about 900 million in 2040. Based on these data, the European Commission estimates the annual market potential for European companies in the field of battery production at EUR 250 billion starting in 2025. In order to meet the objectives of transport electrification to satisfy its own needs, the EU needs to create 10-20 GW of new production capacities, and taking into account the potential demand for European cars – approximately another 10 GW.

According to industry experts, solving such a complex task is possible only with the rapid involvement of significant amounts of private investment, which has become one of the prerequisites for the creation of the European Battery Alliance (EBA), the association of the EU state institutions and individual member states, the European Investment Bank (EIB) and key industrial actors and startups. The Alliance began analyzing the issues in the area and coordinating work on research of advanced battery technology. The organization uses the possibility of obtaining financing from European financial instruments, in particular, the “Horizon 2020” program, as well as coordinates a policy of attracting private investments for new facilities of battery production.

The European Commission in the report suggests the following main directions of implementation of the Strategic Action Plan on Batteries:

– to provide access to raw materials, which are used for the production of batteries, from countries rich in minerals outside the EU;

– to create preconditions for the development of extraction of such materials in European countries;

– to ensure the reusing and recycling of batteries;

– to provide political and financial support for the creation of a comprehensive battery production chain in Europe, through the cooperation of the members of the European Alliance of Batteries, EU member states and the EIB;

-to ensure the deployment of production projects based on the principle of transboundary integration between EU member states according to their economic and logistical advantages;

– to strengthen industrial leadership through increased research and innovation support of advanced (lithium-ion) and revolutionary solid state battery technology;

– to form a qualified labor reserve within the whole chain of production, including special training programs at the level of the EU and individual states, advanced training and retraining, with the involvement of the world’s leading  specialists;

– to develop and implement standards for the production of batteries in the EU, based on the principle of circular economy and minimal impact on the environment;

– to ensure the integration of  the Strategic Plan into the wider context of the EU regulatory and legislative policy in order to achieve climate neutrality, environmentally friendly transport and minimize the impact of  trade and economic relations on the climate;

The purpose of the European Commission is to achieve the so-called level of production of “sustainable batteries”, that is, the minimal impact on the environment from the entire chain of production of batteries. The competitive advantages of European manufacturers should also be the latest technology for recycling and reusing batteries and the creation of relative production capacities.

The production of batteries is on the list of EU strategic goals in the framework of the upcoming 21st century industrial strategy in Europe which is to be developed by the end of 2019. It will take into account plans for the development of transport infrastructure, changes in the energy market, development of electric transport and strengthening of environmental requirements. At the same time, the EU should ensure further economic growth, the development of trade relations and the increase of the number of jobs. Co-operation between states and regions in the EU, business, communities and state bodies at the local and national levels will play an important role as well.

The issue of batteries also drew the attention of the European Court of Auditors, which prepared a “EU-support for energy storage”, a special briefing paper for EU state institutions.

Despite its advisory nature, the document is based on a detailed analysis of European energy and climate legislation, including the provisions of the “Clean Energy Package for All Europeans” and the plans for achieving climate neutrality by 2050. Accordingly, the European Court of Auditors recommends to the EU authorities both legislative amendments and financial changes to the budget process for the next seven-year period of 2020-2027, which should collaboratively promote the achievement of the goals of energy conservation technologies.

One of the particular features of the document of the European Court of Auditors is the attention to the provisions of the Third Energy Package in terms of division of activity of extraction/production, transportation and supply. Accordingly, EU member states are recommended to avoid the creation of power storage facilities based on batteries as part of power transmission and distribution operators, since in this case there may be a conflict of interest at the competitive market.