Europe's Battery Revolution - from Supply Chain Challenges to Gigafactories
The transition to electric vehicles (EVs) is gaining momentum worldwide, and Europe is leading the charge with an ambitious plan to construct 50 gigafactories by 2030. These mega-factories will collectively produce enough batteries to power a staggering 18 million electric cars every year. This bold initiative reflects Europe's commitment to sustainable transportation and positions the continent as a global leader in battery manufacturing.?
Global Battery Players Unite ?
Swedish company Northvolt and Taiwanese firm ProLogium Technology 輝能科技 have invested billions in battery gigafactories in Germany and France, respectively. Germany emerges as a prominent hub for battery manufacturing, attracting major players in the industry. 巴斯夫 is constructing a prototype plant for battery material recycling in Schwarzheide, while China's 宁德时代新能源科技股份有限公司 is establishing a battery manufacturing facility near Erfurt.
Can supply chain risks pose a threat to Europe’s ambition??
An analysis conducted by Transport & Environment reveals that without further action, approximately 68% of Europe's potential battery production capacity, equivalent to 1.2TWh, is at risk of delays, scale-downs, or complete abandonment. Australia is the world’s top exporter of lithium, a key material in EV batteries, and has large reserves of nickel, cobalt and rare minerals.
Additionally, China holds significant control over cell production (over 75%), processed energy material production (over 70%), and energy materials purification and refinement (over 60%). Graphite, which comprises 50% of battery weight (with 25% being natural and 25% synthetic), has been identified as a critical raw material. Europe currently imports 98% of the graphite it utilizes, and the projected addition of 557 GWh/yr battery manufacturing capacity by 2024 will necessitate an extra 450,000 t/yr of anode material.?
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The European plan to ensure success?
The EU’s?Green Industrial Plan focuses on creating a favourable environment for battery gigafactories. It aims to streamline battery production and distribution across Europe through predictable regulations, improved access to finance, enhanced skills development, and resilient supply chains. This plan ensures the growth of net-zero technologies and supports the scaling up of the EU's manufacturing capacity.?
To secure a sustainable supply of critical raw materials for battery production, the EU has enacted the Critical Raw Materials Act. The act sets goals for the EU, such as sourcing at least 10% of annual consumption through extraction, 40% through processing, and 15% through recycling. It also aims to reduce dependence on a single third country, limiting sourcing to not more than 65% of the Union's annual consumption of each strategic raw material.?