UK warned on battery gigafactory support

UK warned on battery gigafactory support

Business news |
By Nick Flaherty

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The UK government has been warned that its plans to support battery gigafactories for electric car makers are falling short.

The warning comes from the UK Parliament’s Business and Trade Select Committee which last year compiled a report on the industry and the need for battery gigafactory plants.

The Committee set seven clear tests for the Government’s plan for EV vehicles to avoid a UK ‘gigagap’ and warned 160,000 jobs in the automotive sector would be at risk. It called for a long term vision for industrial support for battery manufacturing with a clear plan of action.

The UK government this week published its response, which like most of the industrial strategy in the UK has been underwhelming.

Committee Chair Liam Byrne warned that the Government was failing key tests set by the Committee if the UK was to build a domestic industry delivering 100 GWh of capacity by 2030. 

The Committee also sought assurances that Tata’s investment in a new gigafactory could also supply other UK carmakers besides Jaguar Land Rover. The Government, despite its investment of hundreds of millions of pounds in this and Envision’s site at Nissan, said that this was a matter for private companies.

This is a key issue as Tata this week said it is looking to spin out its battery business, Agratas, and its as-yet un-named electric car business, into separate businesses. These would then have different investment priorities.

This also comes as European battery gigafactories from Verkor and ACC are starting production and expanding with significant investment funding.

“We know that we can’t win an international subsidy race but that means we need a smart framework of policy for the future,” said Liam Byrne, Chair of the Business and Trade Committee.

“Ministers’ preferred approach is to leave as much as possible to the market but that’s not how our competitors are behaving. We can’t merely gently accelerate into a global race for a key industry of tomorrow while others are going full throttle. The risk we now run is that a domestic industry won’t be built as fast as it might be, and the big global players might look elsewhere.”

“That’s why our committee set seven clear tests for ministers to meet if they are serious about building a world-beating EV vehicles industry. At best, the Government’s response shows they pass barely half the tests we set, and some ‘passes’ were not convincing,” he added.

“We were pleased to see our progress around tariff-free trade, skills, critical minerals and long term R&D. Those ingredients are really important. But frankly I’m alarmed that the government has no plan to even benchmark the sort of industrial support might be needed to ensure Britain becomes one of the world’s favourite places to invest,” he said.

“Nor did the government take our advice providing long-term certainty on energy costs for battery makers, or the designation of key sites for building the gigafactories of the future.”

The UK government points to pointed to its Advanced Manufacturing Plan and UK Battery Strategy to demonstrate its support for battery gigafactory development.



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