Europe powers up electric car battery drive
As electric car sales soar, Europe has began to build-up its capacity to create batteries on the continent nonetheless it remains far from reducing its reliance on Asia.
China, Japan and South Korea produce almost all of the world's electric car batteries.
Europe now has projects to build 38 gigafactories with a combined gross annual output of 1 1,000 gigawatt hours (GWh) and around cost of 40 billion euros (US$48 billion), according to a June report by Transport & Environment, a non-government organisation.
This annual supply could possibly be reached by 2029-2030 and will be the equal to the production of 16.7 million battery electric vehicles, a T&E spokesman told AFP.
"Given the monstrous upsurge in demand, you will find a major stake accessible for manufacturers to break the battery makers' oligopoly," said Eric Kirstetter, a sector analyst at consulting firm Roland Berger.
"They will also have to ensure access to materials for the electrodes (anode and cathode), that will determine the batteries' price and availability," he added.
In Sweden, the start-up Northvolt expects to reach annual production of 150 GWh in Europe by 2030, with one plant under construction now and two much bigger types on the drawing board.
Northvolt has previously said that production capacity would reach 32 GWh by 2024, or enough batteries for 600,000 electric vehicles per year.
ASIAN COMPETITION
In another report, Transport & Environment said battery electric vehicles could take into account all new sales of units in the 27-nation European Union by 2035 -- if policymakers introduce tighter CO2 targets and strong support for infrastructure to charge cars.
Automakers, which are under great pressure to transition out of fossil fuel vehicles, are putting money into battery production.
German giant Volkswagen has invested in Northvolt and in addition plans to build five other battery plants.
Stellantis, which owns brands such as Alfa Romeo, Chrysler, Citroen, Dodge and Fiat, is focusing on two of its own, while electric pioneer Tesla really wants to make its future gigafactory near Berlin one of the primary in the world with 250 GWh of capacity by 2030.
European governments are backing the projects because they need the continent to keep up a major role in future automobile manufacturing.
Asian manufacturers are also buying Europe, with the Chinese group AESC likely to use Toyota and Renault on battery plants in Britain and France.
Two South Korean companies, LG Chem and SKI, have already opened factories in Poland and Hungary, and China's CATL is building one in Germany.
LESS POLLUTING
European Commission vice president Maros Sefcovic said in March that the continent had a need to achieve strategic independence in what has become a critical sector.
He wants European factories to cover the region's needs by 2025.
That is clearly a tall order, according to Oliver Montique, an analyst with Fitch Solutions.
Montique targets 2040 for the establishment of "an totally closed loop supply chain where the the greater part of battery materials are extracted, refined, processed and produced into battery cells on the continent."
Europe wants to build factories that pollute significantly less than in Asia or america, and EU officials will work on a standard that could impose criteria how recycleables are obtained and used batteries are recycled.
To develop a fresh generation of batteries that are less reliant on the lithium-ion technology dominated by Asian companies, the European Commission launched a study and development programme in January backed by 2.9 billion euros.
European factories could employ 800,000 people, the commission estimates, however they would need to be trained quickly.
Battery factories will also need raw materials.
Demand for lithium is likely to soar by a multiple of 18 by 2030, the European Commission has forecast, and the sector will also likely need five times more cobalt.
Germany and the Czech Republic have substantial reserves of lithium, but Montique advises EU leaders to also ensure supplies from reliable partners.
"I'm thinking of Australia, Canada, Brazil and Chile," he said, "in order that the supply-side is unlikely to be threatened either through normal commercial constraints and/or political reasons."
Source: www.channelnewsasia.com
