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  • Second-Life Batteries
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  • Electric Vehicles

New EU Commission Battery Directive Prioritizes Sustainability

Maria Chavez
Jan 26, 2021

Guidehouse Insights

In December 2020, the EU Commission put out an updated regulatory plan for batteries, covering topics like end-of-life, recycling, performance, classification, and materials sourcing. The directive is part of a wider response to the EU’s Green Deal, which outlines objectives to meet zero greenhouse gas emissions by 2050. The Commission’s directive states that batteries in the EU market should “become sustainable, high performing, and safe all along their entire life cycle.”

What Drives Comprehensive Battery Policy?

A major driver for new battery standards is the ambitious push for EV adoption in Europe. Another one of the Commission’s strategies lays out a timeline for electrification. By 2030, at least 30 million EVs will be in operation in Europe, and by 2050, most vehicles will be zero emissions. This aggressive plan requires an equally ambitious framework for the manufacturing, regulation, and disposal of the batteries that will power those vehicles. Even with the adoption of zero-emission vehicles, there still exists the carbon footprint that results from the manufacturing, transportation, and disposal of battery systems. The Commission’s directive looks to address these issues throughout the life cycle of the battery to make the wide use of EVs in Europe a holistically sustainable solution.

New Manufacturing Standards Will Affect European and World Markets

Included in the directive are guidelines for sourcing, which contains supply chain requirements related to raw materials, processing, and trading. Additionally, there are requirements for battery performance and durability. These points have implications for manufacturers by setting specific standards, which could affect current production. Still, guidelines are meant to create a more sustainable supply chain that will help meet goals in 2030 and beyond.

The previous iteration of the battery directive only included guidelines for recycling and end-of-life leading practices. The recent update expands on these points and focuses on the importance of responsible and sustainable disposal. Specifically, the directive lays out plans for second-life batteries, which should be treated with their own product standards and requirements. Not all used EV batteries are considered waste and when repurposed can serve a number of secondary applications for energy storage. These secondary applications include small storage systems for self-consumption, or larger modular storage systems that aid in area regulation for the grid.

Globally, the market could see an alignment with the EU’s goals, as other countries look toward Europe for guidance. International battery manufacturers and OEMs could also try to adapt their products to fit with these new requirements, especially if the demand for EVs and batteries increases at an ambitious pace. For more information on second-life applications for EV batteries check out Guidehouse Insights' report, Second Life Battery Markets.