To remain on the battery map, EU must run a sprint & a marathon!

10 March 2025

Despite the numerous efforts started with the European Battery Alliance by the European Commission, the Member States and industrial players, the European battery value chain is at a pivotal moment in its existence and potential further growth. The current situation is also affecting ambitions in building a solid industrial foundation for the development and manufacturing of electric vehicles (EVs).

Batteries typically account for 30% of EV price. The development of competitive EVs in Europe therefore depends on the development of cost-effective, performant and sustainable batteries. The futures of the automotive sector and the battery value chain are thus narrowly intertwined.

European competitiveness in batteries for EVs will positively benefit and enable other key applications such as stationary energy storage (for integration of renewable energy into the grid for our energy security), the tools enabling our modern digital society, and also energy-dependent defence technologies.

Industrialization challenges faced by the European battery value chain can be grouped into 4 categories, being the SCOPE of operations and technologies, the SCALE of investments and their profitability, the SPEED of industrialization and innovation, and the SUSTAINABILITY of operations and products. Failure to tackle the 4S challenges is putting our battery value chain in a dire position.

A multifaceted approach based on a rich toolbox of initiatives & instruments, as entertained by the EU Commission and Member States is needed. A strong support for innovation (R&D and first industrial deployment) & its industrialization (scaling-up) are central to the toolbox.

• On SCOPE, we must among others develop both affordable battery chemistries and next-generation battery chemistries with higher performance, safety, and competitiveness such as solid-state batteries;
• On SCALE, we must among others design less capital-intensive & more agile manufacturing processes but also less energy-intensive & cleaner production processes;
• On SPEED, we must among others leverage digital tools for production lines and platforms for accelerated battery materials discovery.
• On SUSTAINABILITY, we must among others prepare for cost-optimized high-efficiency recycling of various complex feeds and innovate on battery sustainability and use of critical raw materials.

For Europe to compete with Asia in such a tough global arena, it is not about innovating less, but innovating more, innovating better, innovating faster or we will be out innovated.

BEPA calls on the EU, the Member States and the battery value chain to run both an innovation sprint for today’s challenges and an innovation marathon to build and maintain Europe’s competitiveness.

Looking at the current European-level support to innovation, 3 key shortcomings are impeding our collective ability to innovate strongly and at the right speed, while putting at risk our ability to industrialize and compete in the global battery race.  

• On the magnitude of funding – We lack ambitious resources to bring the European portfolio of innovation projects to a higher technology readiness level and industrialization, while feeding innovation funnels with new concepts. We also cannot fund all excellent projects (for 1 funded project, about 4 excellent projects are left on the side of the road), increasing technology risk and impacting our technological sovereignty ambitions.
• On the effectiveness of funding – The call for less prescriptive funding instruments, diluting the key role of industry and research in knowing what is best for Europe regarding technology priorities. We also lag behind in benchmarking our funding toolbox with the best and most generous countries (e.g. China, South Korea, Japan, USA) while we receive limited feedback from authorities as to technological progress from funded projects.
• On the efficiency of funding – We are still operating with annual or biennial work programmes at the EU level, with long lag times as to their publication, the closing of proposals submission and the innovation efforts starting on the ground … We are losing precious time due to these inefficiencies.

Compared with other global players in the battery arena, Europe has made some progress over the years since the start of the European Battery Alliance, but we need to keep pushing together. For instance, the yearly R&D budget of the global leader in the battery value chain is higher than the total public funding made available by Europe and all other Member States combined. This brutal realization should wake us up. Despite this, European battery value chain players invest 3-4 euros for every 1 euro of public funding. Yet, our sector needs more, better, and faster support. Change is needed!

In the frame of policy developments including EU’s Competitiveness Compass, Clean Industrial Deal, Critical Raw Materials Act, Net Zero Industry Act, Industrial Action Plan for the Automotive Sector and the  Competitiveness Fund, we call the EU, the Member States and the battery value chain to align ambitiously and promptly on 3 key measures to boost innovation & industrialization, and 3 key measures to boost competitiveness:

• Define clear industry-supported innovation priorities across the battery value chain;
• Align & articulate EU and Member States’ agendas and instruments to reach critical mass;
• Unlock more public & private funding to support innovation & industrialization (CAPEX & OPEX);
• Boost EU-wide demand for products & services generated by the European battery value chain;
• Ensure cost-competitive and secure access to clean energy, critical raw materials, and skills;
• Design the most business-friendly regulatory framework (make, buy, protect) for the battery value chain.

To summarize:

Despite years of massive investments, companies along the battery value chain in Europe are facing tremendous challenges regarding innovation and industrialization.

This pivotal moment must be recognized and the right approach must be embraced: Why not through an update to EU’s 7-year-old Strategic Action Plan on Batteries?

We call on the EU Commission and Member States to wake up, not wait until the next Multiannual Financial Framework, and invest seriously in innovation & industrialization support now.

In the absence of a more ambitious, effective and efficient funding program across Europe and the Member States, we will not be able to remain on the global battery innovation map.

This will be at the expense of Europe’s strategic autonomy, economic resilience, technological sovereignty, and energy security. The time to act is now!

Fabrice Stassin, Secretary General, BEPA – Batteries European Partnership Association