Europe’s battery capacity to reach 1,000GWh by 2025

By Jon Stibbs
Published: Friday, 01 November 2019

Demand for lithium and cobalt will drive upward on a projected doubling in European battery output over the 10 years to 2025, but sustainability will be a major factor.

Battery production capacity in Europe will increase to at least 1,000GWh by 2025 from 440GWh in 2015, according to Gert Meylemans, Eurobat senior communications manager, speaking at Fastmarkets’ Battery Minerals Europe 2019 conference in Amsterdam, September 26-27.

This projected increase will drive considerable growth in demand for raw materials, such as cobalt and lithium.

A key factor in ensuring the development of the market, in the view of the European Commission, will be "securing a sustainable supply of raw materials," Eurobat said.

Annual turnover in the European batteries industry is forecast to soar to more than $150 billion from $65 billion in the 10 years to 2025, the group added.

This rapid escalation will see lithium-ion batteries overtake lead-acid batteries in terms of value for the first time. But lead-acid batteries will retain their traditional position as the principal source of battery capacity.

"Lead-acid technology will still have the highest market share and will stay dominant for the next 10 years," Meylemans said.

New cell manufacturing plants in Europe are being announced every month, Nicolo Campagnol, senior knowledge analyst at McKinsey & Company, told the conference.

Central Europe is emerging as a major location for the batteries sector because of low labor costs and its proximity to car-producing countries such as Germany.

Norway also has a strong batteries sector because it can draw on inexpensive hydro-electric power, which is useful because battery production is energy-intensive.

Norway is also an outlier in Europe in terms of its high rate of adoption of electric vehicles.