- The UK Government has sparked a plan with an EV battery strategy to amp up the supply chain for zero-emission vehicles.
- The plan channels £2 billion of funding over the next five years (until 2030) to drive the development of sustainable transport.
- This aligns with the Government’s 2030 vision, aiming for a globally competitive battery supply chain to support economic growth and the move towards net zero.
Charging forward: UK Government unveils visionary EV battery strategy for supply chain growth
On Sunday, the United Kingdom introduced its first battery strategy alongside an advanced manufacturing plan. As part of the initiative, a substantial £2 billion in funding was specifically allocated to the automotive sector. Over the next five years until 2030, this financial support is intended to support the manufacturing and progression of zero-emission vehicles, with a particular focus on their batteries and the associated supply chain.
While the message isn’t exactly new, it underscores a critical reality: the Government and the Department for Business and Trade have unmistakably received the memo. As Europe, the US, and China surge forward in the realms of EVs and electrification, it’s a clear signal that we must keep pace or risk losing our standing in the global car industry. A similar stark warning came from an influential group of MPs last Tuesday, and their message was clear: the UK risks losing a vital portion of its car making industry to Europe and the US unless it manages to secure crucial battery investment within the next three years.
The strategy document acknowledges a significant reliance on imports for batteries and their materials within the UK. Notably, it emphasizes the imperative to shift towards domestic production, identifying it as a crucial step for ensuring economic security.
Mike Hawes, CEO of the Society of Motor Manufacturers and Traders (SMMT), said:
“Decarbonising road transport is essential if net zero is to be achieved, and that transition must be ‘built in Britain’.”
As per the UK Government, the strategy revolves around a design-build-sustain approach. Through this comprehensive strategy, the UK aims to:
- Innovate future batteries
- Enhance manufacturing resilience
- Foster a sustainable battery industry
Dominique Houde, Partner at Opus Corporate Finance, A GLOBAL FINANCIAL ADVISORY FIRM with a focus on the energy transition, said:
“It is unprecedented, but the reality is that the battery technology ecosystem has concurrently become extremely strategic on several levels: optimised chemistry and battery structure, manufacturing, and further processing such as recycling amongst others. Policies to support capital formation and innovation must take this into account, with a clear strategy across the value chain. We have seen such an approach taken by Canada, for instance.”
According to the document, a successful battery industry is poised to be a significant driver of employment and regional economic growth. Projections indicate that a battery industry catering to domestic EV demand could generate employment for 100,000 people by 2040, with 35,000 in cell manufacturing and 65,000 in the battery supply chain.
The government outlines fifteen key points to support the strategy, encompassing initiatives such as boosting battery collection rates, promoting best practices in end-of-life management, backing manufacturing skills training and education, and expanding market access for critical minerals trade.
Jeremy Wrathall, CEO of Cornish Lithium, said:
“The newly published ‘Battery Strategy’ is a major step forward for the UK battery and associated Critical Minerals strategy. It clearly identifies the opportunities to be had by becoming a world leader in this vital rapidly developing area of industry and manufacturing. The document also recognises the peril that awaits the UK if we ignore this opportunity – given the implications for the economy and for defence.”
A chunk of the allocated funds played a significant role in securing a commitment from Nissan to embark on a substantial £2 billion investment, including the construction of three all-electric models and an additional gigafactory at its Sunderland plant.
The government’s vision for 2030 is centered on establishing a globally competitive battery supply chain in the UK. This strategic objective aims to not only support economic prosperity but also facilitate a seamless transition to a net-zero environment. The emphasis is on fostering an ecosystem that not only meets domestic demands but also positions the UK as a key player in the international landscape, contributing to both economic growth and sustainable practices aligned with net-zero goals.
Julia Poliscanova, Senior Director at Transport & Environment, said:
“To have a successful green industry the UK needs to also look further mid & upstream to onshore more sustainable processing of critical minerals like copper and lithium. But above all, the UK and the rest of Europe must join forces and form a strategic battery alliance to compete in a fierce global clean tech race.“
