3EU Batteries Policy
Summary and Committee’s conclusions
3.1Batteries have been identified by the European Commission as a strategic value chain for the EU, with demand driven by the ongoing clean energy transition—notably electric vehicles and renewable electricity storage. In order to avoid falling behind global competitors, however, it is necessary for the EU to move fast to build a battery value chain, embracing: raw materials extraction, sourcing and processing; battery materials; cell production; battery systems; re-use; and recycling.
3.2Core to this objective is the European Battery Alliance (EBA), an industry-led initiative launched by the Commission in October 2017 to support the scaling-up of innovation solutions and manufacturing capacity. To date, around 260 industrial and innovation organisations have joined the EBA, including the Faraday Institution UK, Jaguar Land Rover and Nissan.
3.3In addition, the Commission adopted in 2018 a “Strategic Action Plan on Batteries” proposing a set of measures to support efforts to build the battery value chain. In its report (document (a)) on the implementation of that Plan, the Commission says that significant progress has been made. Based on the collaborative approach that has already begun, further efforts need to be put into areas such as research, investment, standard-setting, skills, access to raw materials.
3.4As regards standards-setting in particular, the Commission identifies the potential to use the framework of the EU Batteries Directive12 to introduce new regulatory requirements for batteries. These could address characteristics such as connectivity, performance, durability, bi-directionality, re-useability, recyclability and resource efficiency.
3.5In support of its analysis, the Commission also published a report (document (b)) and accompanying evaluation (document(c)) on the implementation of the Batteries Directive. The Commission found that the Directive has been partially successful in achieving its objective of minimising the negative consequences of batteries on the environment, although there has been limited success as regards the collection of waste batteries and the recovery of specified materials (lead and cadmium). The Directive also lacks an efficient mechanism to incorporate new technologies and usage, such as lithium-ion batteries used in electric vehicles.
3.6Commenting on the report on the Batteries Directive, the Parliamentary Under-Secretary of State for the Environment (Dr Thérèse Coffey MP) notes in her Explanatory Memorandum (EM) that it is part of a continuing process under which the Commission is considering the case for revising the Batteries Directive. She adds that there is significant alignment between the thrust of the Commission’s report and the Government’s Resources and Waste Strategy published in December 2018. The Government therefore welcomes the Commission’s considerations but will need to take a view on any proposals that emerge in due course.
3.7In a separate EM on the battery value chain (document (a)), the Parliamentary Under-Secretary of State for Business and Industry (Andrew Stephenson MP) says that the Government recognises the importance and pace of the electrification of the automotive sector which is why this is central to the UK’s modern Industrial Strategy and the Automotive Sector Deal.
3.8The Government also recognises the strategic importance of batteries and energy storage that underpins the Commission’s Strategic Action Plan on Batteries. For this reason the UK government launched the Industrial Strategy Challenge Fund’s £246 million Faraday Battery Challenge. Within the UK, this is delivering the type of important collaborations between stakeholders across the value chain that are being sought by this initiative. The programme also includes a pilot production facility—the UK Battery Industrialisation Centre (UKBIC) in Coventry opening in 2020.
3.9The “Important Projects of Common European Interest” (IPCEI) framework13 could be a helpful tool in supporting the nascent batteries sector, says the Minister. He says that officials are exploring if and how the UK might participate in this aspect of the European Battery Alliance initiative, and how it fits with support offered by existing UK research and development measures (including the Faraday Battery Challenge and Advanced Propulsion Centre programmes).
3.10The Government agrees with the central role that regulation and standards would play in this policy area and is engaged with this initiative for example via its Faraday Battery Challenge programme.
3.11The two Ministers adopt a generally positive approach to these documents, noting alignment between the EU and UK approach. Both EMs are disappointingly thin, however, on the important question of how EU regulation might develop in this area. It is particularly unhelpful that no substantive mention is made of the UK’s withdrawal from the EU as it is likely that the EU approach will affect the UK under any Brexit scenario other than an end to trade between the UK and EU, which we do not consider a viable proposition.
3.12Our analysis is that future UK and EU policy in this area will continue to be linked based on the following considerations drawn from the Withdrawal Agreement and Political Declaration negotiated between the Government and the EU:
- in the event that the terms of the Protocol on Ireland/Northern Ireland (the “Backstop”) were to apply, the UK as a whole would commit to maintaining existing EU environmental protection and, furthermore, the Batteries Directive and other potentially relevant legislation—such as chemicals Regulations14 and the ecodesign Directive15—would continue to apply in Northern Ireland, including any amendments made to them;
- in order to enable unfettered market access for goods moving from Northern Ireland to Great Britain while the Backstop was in force, it is probable that any changes introduced and applied in Northern Ireland would be applied in Great Britain too;
- the Backstop will only cease to be operative in full or in part if it has been superseded by a future relationship agreement that achieves the same underlying objectives, and so it should be assumed that its core provisions will continue to apply during the future relationship—including the legislative alignment detailed above—unless and until alternative arrangements to achieve the same objectives have been identified and implemented; and
- regardless of the requirements set out under the Backstop, the EU and UK agreed in the Political Declaration that the future relationship must ensure open and fair competition and that this should extend to environmental standards, building on the level playing field arrangements provided for in the Withdrawal Agreement and commensurate with the overall economic relationship, thus also implying that continued alignment with EU environmental standards—such as those applicable to batteries—may form part of the future relationship.
3.13In the event that there is no negotiated exit deal between the UK and the EU in the short, medium or long term (an assumption against which we would counsel), EU law relevant to batteries would cease to be directly applicable in the UK but would in practice continue to play an important role, particularly for UK businesses trading with the EU. While the UK would be under no obligation to align with EU rules, the UK may continue to shadow EU rules in many areas for efficiency and to avoid erecting barriers to trade. Batteries—which affect a range of industries—may well be one such sector.
3.14We ask the Ministers to confirm whether they share our analysis of the implications of EU exit in this area and to explain why they decided not to set out any detail on these matters in their respective EMs. We would like to be clear whether the Ministers were simply not aware of the potential future linkages—including the inclusion of the Batteries Directive in the Backstop—or whether they actively decided that the information was not relevant.
3.15Despite the likely continued relevance of EU law under all scenarios, neither Minister expresses a view on how EU regulation should evolve, nor any intention to pro-actively engage. We remind the Ministers that it will not be simple to influence proposed EU laws once the UK is no longer in the Council, nor represented in the European Parliament. As a result, we urge the Government to take a proactive approach. Indeed, the current point in the EU policy-making cycle is an ideal one at which to seek to exert influence over new policy under the incoming Commission.
3.16We ask for:
- a clear analysis from both Ministers of the EU regulatory changes that the UK would like to see; and
- confirmation that the UK will pro-actively engage in the debate, setting out its views to the Commission.
3.17We expect a response from both Ministers by 26 June 2019. The documents remain under scrutiny. We draw this chapter to the attention of the Business, Energy and Industrial Strategy Committee, the Environment, Food and Rural Affairs Committee and the Environmental Audit Committee.
Full details of the documents
(a) Commission Report on the Implementation of the Strategic Action Plan on Batteries: Building a Strategic Battery Value Chain in Europe: (40506), 8415/19 + ADD 1, COM(19) 176; (b) Commission Report on the implementation and the impact on the environment and the functioning of the internal market of Directive 2006/66/EC of the European Parliament and of the Council of 6 September 2006 on batteries and accumulators and waste batteries and accumulators and repealing Directive 91/157/EEC: (40513), 8483/19, COM(19) 166; (c) Commission Staff Working Document on the evaluation of the Directive 2006/66/EC on batteries and accumulators and waste batteries and accumulators and repealing Directive 91/157/EEC: (40519), 8484/19, SWD(19) 1300.
Previous Committee Reports
None.
12 Directive 2006/66/EC on batteries and accumulators and waste batteries and accumulators and repealing Directive 91/157/EEC.
13 Important Projects of Common European Interest (IPCEI) are projects involving more than one Member State contributing to the Union’s strategic objectives and producing positive spillovers on the European economy and society as a whole. In case of research, development and innovation projects, such projects must be of a major innovative nature, going beyond the state of the art in the sectors concerned.
14 Such as REACH—Regulation (EC) 1907/2006 concerning the Registration, Evaluation, Authorisation and Restriction of Chemicals and establishing a European Chemicals Agency.
15 Directive 2009/125/EC establishing a framework for the setting of ecodesign requirements for energy-related products.
Published: 11 June 2019