Europe needs to develop new battery technology and build a 5G network as part of a Pact for European Jobs, says Manfred Weber (above), chairman of the EPP Group in the European parliament.
Speaking in the European Parliament following the speech by Ursula von der Leyen to open the new session, he called on the EU to give more credibility with concrete projects and actions, including a Digital Act with binding targets for infrastructure and investment.
The EPP is is the largest political group in the European Parliament with 187 Members from all EU Member States.
The commission has already been working on boosting the battery eco-system in Europe, including supporting the construction of battery gigafactories in Sweden, France and Germany. This has led to the European Investment Bank (EIB) changing the way it supports projects.
“Despite fighting the Covid-19 the battery alliance despite all the restrictions has remained on track and there is strong appetite from all the actors to accelerate the value chain and this is reflected in the growing investment,” said Maros Sefcovic Vice president of the European Commission and responsible for the battery alliance.
“In 2020 to date more than €25bn [has been invested] and I would say this is approximately twice as much as China has invested in the sector,” he said. “Thanks to that we are set to become second to China in the supply of batteries by 2024.
“Next I want to continue our collaboration with the EIB and a new regulatory framework on sustainable batteries as we are working hard on this for the autumn of this year and completed by 2022,” he added.
Skills are a key issue for jobs in this area.
“Over the next couple of years there will be a scarcity of competence,” said Peter Carlson, CEO of startup NorthVolt which is building two battery gigafactories, one in Sweden and one in as a joint venture in Germany with Volkswagen. “We and other projects will need a number of engineers and they are not available in Europe today so we need a strong focus on education for these skillsets such as chemical engineering and energy systems management to build up the skills base.
Financing of a secure battery supply chain is also key.
“The IEB is very much repositioning itself as the financial arm of the European Green Deal and batteries are the missing link of green energy plans,” said Andrew McDowell, vice president of EIB. “Its hard to think of a successful transition without state of the art energy storage – they really do hold the key for any other low carbon technologies. We have been persuaded that Europe should be leading this transition to an independent battery ecosystem for a market of €250bn by 2025.”
This includes a secure supply chain that includes jobs.
“A secure local battery sector is important to the European automotive sector and Covid-19 has only highlighted Europe’s vulnerability to the interruption of the supply of critical materials. Most battery components are manufactured outside the EU, and car makers especially have suffered disruptions to their supply chains form a shortage of battery cells in particular,” said McDowell.
“The EIB is now stepping up financing of all stages of the battery value chain, from R&D, mat4erials extraction, through to recycling. We expect to make commitments of E1bn to six or seven battery chain projects and this is a significant increase in recent years, about the same as the previous ten years,” he said. “This is a growing business for the bank and the Battery Alliance has played a crucial role in bringing us into this business.”
NorthVolt is a key example of this, and was funded as a startup. “This is a brand new business model for a recently established company without a history of trading,” said McDowell. “What we are lending against is the confidence in the management team, the technology and the contracts Northvolt is signing with auto makers.”
“It’s been a very interesting year for us, trying to manoeuvre this megaproject in the framework of the Covid-19 limitations,” he said. “On the customer side what we are seeing is a higher activity than ever in Europe driven both by how the auto industry is seeing an acceleration to electrification and a clear focus of regionalisation of supply chains and being less dependent on global sourcing and China.”
“The big challenge around this is to recruiting all the skilled workers. We are on a path over the next four years to recruit 3000 employees to this facility [in Sweden] and that work has started but it also requires a lot of relocation. We are recruiting 15 to 20 people a week,” said Carlson, aiming for full scale production in 2021.
“It is important for the battery alliance to continue to focus on the total ecosystem supported by materials components, suppliers of equipment, this is where we really need to continue strengthening the ecosystem and we are still dependent on a lot of sources outside Europe,” he said. “We are building plans to develop this ecosystem but it will require focus and investment.”
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