Battery Industry in Europe — New Rules to Support EU Battery Production Under Attack in Council

Some EU governments want to slow down the introduction of standards that would ensure batteries are low carbon, made with ethically sourced metals, and are fully recycled at the end of their life.

As Europe and the rest of the world continues to reduce its use of fossil fuels on the path to net zero, so our reliance on batteries – the key strategic technology of the 21st century – is set to increase. Dozens of new battery gigafactories are on track to be built in Europe over the next few years, investments that should put Europe firmly on the global battery map and secure autonomy in this strategic supply chain of the future.

To help accelerate Europe’s late start in the global battery race, the European Commission proposed a new Sustainable Battery Law – the first of its kind – with the objective of supporting a competitive domestic battery industry. The new rules will set a new global standard for batteries produced in and sold to the European market to ensure batteries are low carbon, made with ethically sourced metals and are fully recycled at the end of their life.

By setting higher sustainability standards for batteries, Europe can secure the path to a sustainable transition to e-mobility, whilst at the same time giving a boost to European industry who can more easily compete with more established incumbents. With speed the name of the game in this fast growing industry, providing legal certainty will also help unlock large-scale investments.

Unfortunately, a recent compromise text tabled by the Slovenian Presidency late last year puts all of this at risk. Under the guise of protecting industry from ‘excessive administrative burden’ and ‘red tape’, certain national governments at the forefront of slowing down or even opposing the transition to zero emission mobility appear to have secured significant delays to the application of these new rules. Specifically, some proposals would postpone the introduction of new rules for:

• Responsible battery material sourcing by four years.
• Low carbon battery production by six years.
• Recycling of batteries and valuable battery metals, like cobalt and lithium, by five years to 2031. This is despite some of the targets proposed by the European Commission already being met today.

This raises the question of whose interests some of the governments pushing for these delays are representing. T&E understands that the calls for delays are mostly coming from central and eastern European countries that are home to many Chinese battery investments. The entire premise of the proposed EU Battery Regulation is to make Europe a leader in the green battery value chain, so European governments should be acting in the interests of European companies (and environmental benefits at large), not protecting those incumbents that the nascent European battery industry is competing against.

Rather than delaying the introduction of the new regulation, member states should be pushing to accelerate its implementation, or risk seriously undermining the business case for many of these investments.

Crucially, there is still time left for EU member states to change tack ahead of the Environment Council meeting on 17 March, where a final compromise text is expected to be agreed ahead of negotiations with the European Parliament. T&E calls on national governments to reject the proposals for needless and counterproductive delays and support, at the very least, those timelines proposed by the European Commission.

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Originally published on Transport & Environment.