03

The battery evolution

Europe’s companies must now embed sustainable practices

Batteries can help the European Union to achieve climate neutrality. But more industrial processes could easily have the opposite effect, so European battery and battery storage manufacturers need to prioritise sustainable production, deployment, and waste management.

“ESG is becoming really important in this industry. We have to make sure we take the carbon out of the conversion processes of the refined material or post refining.” Isobel Sheldon, Chief Strategy Officer, Britishvolt

Sustainable benefits

A sustainability focus will build greater efficiencies and environmental compliance into the production processes – by using less energy and recycling, for instance. This should lead to advantages over Asia, where sustainability is not such a priority.

say that sustainability principles will give European battery makers an edge in the international market

say they feel the need to differentiate their businesses by increasing their environmental credibility

“ESG is becoming really important in this industry. We have to make sure we take the carbon out of the conversion processes of the refined material or post refining.”

ISOBEL SHELDON Chief Strategy Officer, Britishvolt

Green energy needs to be for everyone

With pressure to lower emissions in the industrial supply chain, shifting to renewable energy is an obvious move.

“We've got to reimagine manufacturing and conversion processes, because we've got to lower the energy use,” says Isobel Sheldon at Britishvolt, which is seeking a low-carbon energy supply for its Northumberland manufacturing site.

Another example is Northvolt, which has committed to using 100% renewable energy from hydropower at its gigafactory in Sweden.11 However, it is not straightforward for all companies.

of respondents say they struggle with using renewable energy in the production process

Incentive to prepare

By 2022, the European Commission hopes to have in place strict new environmental standards for batteries,12 and these will also include regulations on recycling. This should help to keep out imports of cheaper, less sustainable components and boost local production.

“This whole thing about needing to localise and rules of origin for the UK or for vehicles that are being built in the EU and exported to the UK, is really important, because it means we now have this incentive to green up the supply chain, to localise it, and bring some of those conversion processes back into the European geographical area,” says Britishvolt’s Isobel Sheldon.

Our survey respondents agree with Sheldon.

‘Europe must step up reuse and recycling of batteries and materials to meet growing demand.’ Do you agree?

‘Raw-material shortages will make it necessary to embed more circular-economy principles in the future.’ Do you agree?

The circular economy is not ready yet

But respondents say they struggle with waste disposal and mandatory and voluntary recycling targets.

Many struggle to embed sustainability measures in their organisations

How much of a challenge is it for you to implement the following in your organisation?

But there is still time to get the infrastructure in place, given that the first generation of batteries put in electric cars a decade ago still have several years before they expire and become available for recycling. In the meantime, production will have to ramp up to make up for the missing circular feedstock.

“Demand for batteries is too high versus the potential number of batteries that could come back as recycled. Even if all batteries that were commercialised in 2010 are going to be recycled in 2025, we’re talking about 10,000 batteries versus the 1 million you could say we have ambitions to produce,” says Francisco Carranza, Vice President Sales and Marketing at Automotive Cells Company (ACC).

In Section 4, read more about the risks looming on the horizon