EESC warns that without a strong European battery industry, car manufacturers may leave the EU

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The European Economic & Social Committee (EESC) has supported the European Union (EU) action plan on batteries put together by the European Commission but points out that it needs to be stepped up and implemented swiftly.

Currently at stake: relocation of the EU car industry

There is a real risk that very large parts of the European automotive industry will relocate their production to regions close to battery cell production units, mainly in Asia. In the opinion drafted by Colin Lustenhouwer and adopted at the July plenary session, the EESC throws its support behind the European Commission’s Strategic Action Plan on Batteries but warns that it needs to be beefed up and implemented quickly to avoid the possible move of European car factories outside the EU. “The stakes are very high. We are talking about the jobs of some 13 million European workers in the sector,” said Mr Lustenhouwer. “There is clearly a widespread sense of urgency among policy-makers, scientists and businesses. They realise that it is late, even too late. We need effective, safe and environmentally‑friendly batteries.”

State of play: the EU battery industry is moving slowly

Batteries have become indispensable in our daily lives: they are an important component of our mobile phones, PCs, tablets and domestic appliances but also of electric vehicles. At the moment, the EU lags far behind, both in terms of development and production. Europe is dependent on non-EU countries, in particular Asia. As much as 85% of all our batteries come from China, Japan or Korea. European production represents a mere 3% of world production, with the USA accounting for around 15%. In electric cars, batteries account for around 40 to 50% of their cost. These figures will probably fall in the near future, given the very rapid development of the sector, paving the way for a potentially huge market for European industry.

The European Commission’s first progress report on the implementation of the Strategic Action Plan on Batteries, published in April 2019, shows that a variety of actions have been launched to develop a significant battery industry in the EU. An example is the European Battery Alliance, a platform which enables businesses, policy-makers and scientists to work together and coordinate their efforts. However, much more has to be done in the EU in the coming years to develop the sector, focusing on investments and innovation. Measures should aim to achieve the necessary level of technological expertise, to secure the supply of raw materials from third and European countries, and to ensure that batteries can be recycled safely and cleanly.

 Way ahead: R&D, secure supply of raw materials, recycling

The battery strategy is not a one-off initiative but requires a structural approach in EU policies. Investments made now may only become visible in the future: there is a long payback period, between 20 and 30 years. “We need a long-term policy and underlying support from national authorities,” declared Mr Lustenhouwer. “Governments can play a role as drivers of an investment process, bringing together investors and promoters.”

The weak point of the EU is the limited amount of raw materials at its disposal. Traditional batteries contain metals such as lithium, nickel, manganese and cobalt, which are currently being extracted in small quantities. Potential reserves are present and will need to be exploited, though it currently seems that they will only be able to cover around 15 to 20% of total demand. New types of battery, such as the solid-state ones, should be developed and that would reduce by far the dependence on raw materials.

Generally speaking, the European population has serious reservations about mining and re-opening abandoned mines (the NIMBY – Not in My Back Yard – principle). The positive effects of the socially and environmentally conscious extraction of raw materials should therefore be highlighted. It is essential to involve local communities (“local ownership”) if we are to avoid resistance preventing these activities from getting off the ground.

Recycling can also make a substantial contribution, for example through so-called “urban mining” (recovering elements from used products and waste). However, the figures are low: approximately 57% of conventional batteries are not recycled yet and recycling of the materials is still in the early stages: only some 10% of an old battery is recovered. More practical initiatives are needed, especially to increase the collection amounts and the recycling rates.

Attention should also be turned to EU consumers and standards. “Targeted information campaigns have to inform European consumers that purchasing batteries produced in Europe has many advantages over purchasing batteries from third countries, where human values and environmental safety standards are not necessarily respected to the same extent,” concluded Mr Lustenhouwer. “Carrying on as we do at present is a permanent way of exporting our environmental problems.”