Why Europe’s battery value chain needs regulatory certainty – now

European nickel producers need a consistent regulatory framework. There must be coherence between different EU policy objectives with rules based on principles of sound science, risk-based approaches, full life-cycle thinking and impact assessments.

It is now nearly two years since the European Batteries Alliance was established. The project was initiated by the European Commission and EU member states at the highest political levels with the aim of establishing a complete European batteries value chain for electric vehicles, from mining to recycling. It was one of the Juncker Commission’s most ambitious projects and brings together stakeholder groups acting within or surrounding the batteries value chain.

Given the urgency of addressing climate change in mobility, but also the need to close the gap between EU industry and the market-leading battery producers outside Europe, there is a need to act in a timely, efficient and targeted manner.


The question is where will the batteries value chain be located? Will Europe or other regions benefit from this market opportunity?

From 2025 onwards, according to the European Commission, Europe could capture a battery market of up to €250 billion – per year! This would require at least 10 to 20 large-scale battery cell production facilities. Let’s be clear: the EV and batteries revolution will come. The question is where will the batteries value chain be located? Will Europe or other regions benefit from this market opportunity?

A strategic action plan has been published, comprising a wide range of activities and concrete actions covering raw materials to batteries production and recycling. Industrial consortia and partnerships are up and running; a wide range of R&D projects have been kicked off with access to finance for actors within the batteries value chain. Significant investments have been made, and production sites are already are in operation or expected to start operating within the short to medium term.

Planning security and predictability

The batteries value chain with its individual production stages is capital intensive. Access to finance is crucial. The sector requires long term investments with an outlook of 2030 and beyond, and potential investors within this value chain require planning security.

Planning security goes hand in hand with predictability which is closely linked to consistency in the regulatory framework. Industry and investors need to be certain that the regulatory framework allows raw materials to be produced and batteries to be assembled. There must be a thriving batteries and automotive industry as well as other industries that will eventually re-use batteries as well as recycling industries for end of life recovery.

European raw materials production

Raw materials going into EV batteries play a critical role. For the European Union, maintaining and promoting European raw materials production is important from various perspectives:

  • It ensures that Europe avoids dependencies on imports.
  • It also guarantees that these raw materials are produced under the highest environmental and social standards.
  • Highly qualified and well-paid jobs are maintained in Europe and will contribute significantly to its GDP.
  • European metals production is known to be highly energy efficient and linked to a lower carbon footprint. It therefore influences the overall emission performance of an electrical vehicle significantly.

The challenges for the European nickel industry

Take nickel, for example. It is one of the main components of current and future EV battery technology. The European nickel industry is however facing challenges, such as growing global competition especially from producers in China. For many years our industry has known how to address these issues and how to remain competitive – by being innovative, energy and resource efficient and continually improving our processes. But there are inconsistencies in the regulatory framework which make it increasingly difficult for raw materials producers to compete and maintain production in Europe. Two examples:

  • While Europe has a significant demand for battery raw materials, there is an increasing risk of some of these substances being considered as substances of very high concern, even though they have a track record of being safe when produced, used and recycled. Disproportionate regulatory risk management that does not sufficiently take into account societal benefits of the use of these substances could be the consequence.
  • Production of raw materials such as nickel is energy intensive, even though companies are continuously improving their energy efficiency. The risk is that companies in the EU will lose their global competitiveness due to emissions trading costs in Europe, because of a lack of compensation of indirect CO2 emission costs through increased electricity prices.

The risk is that companies in the EU will lose their global competitiveness due to emissions trading costs in Europe

We want to continue producing these raw materials in Europe, and this should also be in the interest of regulators and other actors in the value chain. What European nickel producers need now is a consistent regulatory framework based on principles of sound science, risk-based approaches, full life cycle thinking and impact assessments. This allows us to continue production and to contribute to a sustainable European batteries value chain. A value-chain that is critical to helping tackle climate change in a way that keeps jobs and know-how within the EU.