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EU agrees on groundbreaking law to advance sustainable and circular batteries

The European Parliament and the Council reached a provisional political agreement aiming to make all batteries placed on the EU market more sustainable, circular and safe. Sustainability requirements on carbon footprint, recycled content and performance and durability are set to be introduced gradually from 2024 onwards.

The Batteries Regulation, which builds on the European Commission’s proposal from December 2020, brings forward both the circular economy and zero pollution ambitions of the EU by making batteries sustainable throughout their entire lifecycle – from the sourcing of materials to their collection, recycling and repurposing.

Batteries are set to play a key role in advancing EU’s climate neutrality by 2050 and in the current context the new rules establish an essential framework to foster further development of a competitive sustainable battery industry, which will support Europe’s clean energy transition and independence from fuel imports.

New rules for production, recycling and repurposing of batteries

Once the new law enters into force, sustainability requirements on carbon footprint, recycled content and performance and durability will be introduced gradually from 2024 onwards. A more comprehensive regulatory framework on Extended Producer Responsibility will start applying by mid-2025, with higher collection targets being introduced over time. For portable batteries, the targets will be 63 per cent in 2027 and 73 per cent in 2030, while for batteries from light means of transport, the target will be 51 per cent in 2028 and 61 per cent in 2031. All collected batteries have to be recycled and high levels of recovery have to be achieved, in particular for valuable materials such as copper, cobalt, lithium, nickel and lead.

This will guarantee that valuable materials are recovered at the end of their useful life and brought back into the economy by adopting stricter targets for recycling efficiency and material recovery over time. Material recovery targets for lithium will be 50 per cent by 2027 and 80 per cent by 2031.

Companies placing batteries on the EU internal market will have to demonstrate that the materials used for their manufacturing were sourced responsibly. This means that social and environmental risks associated with the extraction, processing and trading of the raw materials used for battery manufacturing will have to be identified and mitigated.

Regulating Europe’s booming battery industry

“The agreement reached today sets out clear rules to support scaling up battery use and production, and ensure it is done in a safe, circular, and healthy way,” commented Frans Timmermans, Executive Vice-President for the European Green Deal on the new legislation.

In 2017, the Commission launched the European Battery Alliance with the task to build an innovative, sustainable and globally competitive battery value chain in Europe and ensure the supply of batteries needed for decarbonising the transport and energy sectors.

“Setting a top-notch, future-proof regulatory framework for batteries has been among the key priorities under the Alliance,” said Maroš Šefčovič, Vice-President for Interinstitutional Relations and Foresight adding that all industrial players in Europe will now have a clear, predictable legal environment that supports them in innovating and preparing for the expected surge in e-mobility in coming years.

Demand for batteries is increasing rapidly and is set to increase 14-fold by 2030 and the EU could account for 17 per cent of that demand. This is mostly driven by the electrification of transport. Such exponential growth in demand for batteries will lead to an equivalent increase in demand for raw materials, hence the need to minimise their environmental impact.

Patrick Clerens, Secretary General of the European Association for Storage of Energy (EASE) highlighted that the battery energy storage systems deployment rates are incredibly high in Europe. “Battery energy storage systems can replace polluting gas peakers, contributing to reducing the need for gas imports and therefore ensuring energy security and a green transition,” he added.

The next steps will be crucial

Mr Clerens also stressed that there is still much work to be done emphasising that secondary legislation will play a key role in the context of the Batteries Regulation.

“Batteries used in energy storage systems are different from those, for example, in electric vehicles. It is therefore paramount to ensure that secondary legislation is designed having in mind energy storage’s unique characteristics and applications. Otherwise, we risk creating barriers and hinder the energy storage sector, ultimately hurting consumers,” he underlined.

The European Parliament and the Council will now formally have to adopt the new Regulation before it can enter into force. The new Regulation will replace the existing Batteries Directive from 2006.

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