Horizon Europe batteries partnership sets out new vision for research funding

30 April 2024

A Horizon Europe effort to boost EU battery production is rebooting itself with a new technology strategy and new funding calls in 2025. But it acknowledges the tough challenge Europe still faces from mounting battery competition in China and the US.

The €925 million project, called BATT4EU, is a public-private partnership for battery research and innovation launched in 2021. As climate worries and electric vehicle demand have risen, the project is among several EU initiatives to try boosting local battery supplies – but those efforts were dinged last year by the European Court of Auditors for inadequate coordination.

The response was the publication in February of a new Strategic Research and Innovation Agenda (SRIA) by BATT4EU. It lays out nine key areas that Europe needs to address to develop a competitive and sustainable battery industry. It plans an “information observatory” to assess progress of the various EU initiatives and the market. And it envisions publishing funding calls in spring 2025, before updating its agenda for intended 2026-2027 calls.

The report drew some good initial reviews from the auditors. “I think the new SRIA correctly interprets the court’s concerns,” Afonso De Castro Malheiro, head of task for the ECA report, told Science|Business. The information observatory, and a planned strategic roadmap to identify research priorities, are “relevant suggestions” in this context, he said, but it will all come down to implementation.

“It is important that this is implemented in an effective way, that the information flows in both directions, and in particular, that the national or regional managing authorities become more aware of what is happening at European level,” he said.

The ECA noted in its report an improvement in the coordination of Horizon Europe funding with the launch of BATT4EU and its first SRIA in 2021. However, the auditors found that calls for the European Regional Development Fund were not aligned with this strategy.

Coordination is one of the nine key areas identified in the SRIA. Others cover specific parts of the battery value chain, including materials, design and manufacturing. BATT4EU has already begun sharing the document with other EU funding mechanisms and with member states, to solicit feedback and align activities across the continent. The Commission has also taken steps to make the deployment of public funds more efficient, inviting EIT InnoEnergy to launch a one-stop-shop for start-ups and SMEs across the battery value chain looking for EU public funding.

Tough competition

Meeting Europe’s green and digital ambitions will depend on its ability to design and mass-produce cutting-edge batteries, with global battery demand expected to increase 14 times over by 2030. But the European battery sector is facing several major hurdles, including a dearth of skills, slow permitting, higher energy costs than other parts of the world, and a significant dependence on China and other regions for critical raw materials like lithium and cobalt. At the same time, the 2022 US Inflation Reduction Act is now funnelling new money into the American battery industry – with the possible result that battery prices in the US could end up being 40% lower than in Europe, according to the SRIA.

This week the European Court of Auditors released an overview of four recent studies on road transport, including a special report on batteries, and concluded that the transition to electric vehicles risks relying on imports, “if EU capacity and competitiveness do not increase significantly”.

Less than 10% of global battery manufacturing is based in Europe, and most of this is done by non-European companies, whereas China accounts for 76% worldwide. European electric vehicles remain unaffordable, largely due to the batteries, “which can cost €15,000 on average in Europe”, the ECA points out.

The Commission has made good progress in promoting a European industrial policy on batteries, Malheiro of the ECA said. But it needs better information and to set clear targets. The 2018 strategic action plan on batteries, for example, sets the ambition of making Europe “an industrial leader”, but lacks quantifiable targets. “It is important in our view that the Commission renews that strategy on batteries, taking into account the constraints around raw materials and what we can produce in Europe on the basis of those constraints.”

Seismic shifts

The BATT4EU partnership was launched in 2021 to mobilise €925 million in funding. But the sector has undergone seismic shifts since then, meaning an updated strategy was necessary to better steer investments.

For instance, new priorities are needed to take into account technological developments in areas such as sodium-ion batteries.

“Some of the materials that were considered cheaper and less powerful have had breakthroughs and seem to be able to play a role in more high-end markets as well,” BATT4EU executive director Wouter IJzermans told Science|Business.

Europe’s manufacturing capacity is also evolving. For instance, Swedish battery maker Northvolt recently opened the continent’s first “gigafactory”. According to the SRIA, eight other battery plants are now operating around Europe, with 21 more planned by 2030.

“When we started (BATT4EU) in 2021, they were mostly just PowerPoint decks. Now they’re actual factories being built; so we needed to realign,” said IJzermans. Ensuring research results reach gigafactories and the market is one of six imperatives identified in the SRIA.

Affordability is another priority, to enable the mass deployment of electric vehicles. This means “cheaper materials, but also materials that last longer so you have a better second-hand EV market,” IJzermans said.

Other priorities include ensuring manufacturing and recycling systems are flexible enough to respond to evolving technology. The new strategic plan focuses on reducing reliance on foreign, critical raw materials by developing alternatives, including biobased materials, and by increasing circularity. In the shorter term, the aim is to boost European raw material processing capacity.

“It will be a while, I think, before we get competitive batteries that have a reduced CRM footprint,” said IJzermans. “Even if we don’t have the raw materials, at least the processing we can do in Europe.”

Funding calls to come

The SRIA will now be implemented through annual calls, starting with the work programme for 2025, with the first calls expected to be published in spring 2025. There will be another, smaller update to the strategic agenda next year which will form the basis of the 2026 and 2027 work programmes.

How many of the priorities can be implemented in 2025 will depend on the annual budget, which is yet to be agreed. BATT4EU will also continue to look at the possibility of joint calls to leverage the budget even further, as it has done with the 2Zero road transport partnership in the past.

It is also talking to partnerships of end users, such as the Clean Aviation joint undertaking, and upstream partnerships in areas such as photonics. “We’re looking on both sides to see how we can maximise our impact and fully realise what’s in the SRIA,” IJzermans said.

Private sector contributions to BATT4EU have also been positive, reaching “almost double” the Commission’s contribution so far, he added.

The strategic actions included in the SRIA were developed by more than 500 experts as part of six working groups operated by the Batteries European Partnership Association, which represents industry in BATT4EU, and Batteries Europe, which brings together experts from research, industry and academia.

What’s the technology shopping list for the Horizon batteries partnership?

In its new strategy, BATT4EU lists several technologies that it says Europe needs to compete in the global batteries market. Some of these may appear in its future funding calls.

Raw materials

• Sustainable processing and refining of battery raw materials
• Integration of secondary raw materials

Advanced materials

• Liquid electrolyte lithium-ion batteries
• Solid-state lithium batteries
• Development of next-generation sustainable batteries for mobility
• Non-lithium-ion batteries (driven by stationary storage)
• Sodium-ion batteries (driven by mobility and stationary storage)
• Biomimetic materials with self-healing functionalities
• Accelerated battery material discovery through multi-modal characterisation

Design

• Safe and sustainable batteries by design
• Functional cell and battery design

Manufacturing

• Sustainable production of cells and batteries
• Flexible production technologies
• Digital twins for sustainable design and manufacturing of batteries

Application: mobility

High-performance, cost-efficient and safe by design battery systems
Cloud-based battery management for multi-application integration
Accelerated multiphysical and virtual testing and development
Demonstrations for mobility applications

Application: Stationary storage

• Long duration energy storage
• Battery management for optimised battery utilisation

Dismantling and recycling

• Sustainable, safe and efficient recycling processes
• Enhanced flexibility of recycling processes

Transversal topics

• LCA and LCI development for next-generation batteries and stationary storage applications
• Battery passport development for batteries with external storage
• Development of education-specific pilot lines