As the global race in green battery production intensifies, the EU’s proposed batteries legislation aims to set a global green standard – and give the bloc the competitive edge in a rapidly growing market.

It’s a market set to explode as the global green economy transition intensifies. But the burgeoning battery market has already been attracting criticism as ‘white oil’, as one recent investigative report put it. Conscious of the associated potential problems and coherent with its green economy ambitions, the EU’s new legislative proposal on batteries seeks to set the bar high by setting tough environmental standards – and steal a march on the competition by allowing European producers to market their batteries as the world’s greenest.

This is not of course the EU’s only initiative in pushing European leadership in the global battery market. It is a key part of the EU’s Action Plan on Raw Materials and follows a €3.2bn cash injection into European battery projects and the creation of the public-private European Batteries Alliance.

Published on 10 December, the proposal sets ambitious recycling targets for new batteries and obligations for their end-of-life management. As of 2030 binding targets will apply for the proportion of battery components from recycled metals: 4% each for lithium and nickel, 12% for cobalt and 85% for lead, amounts that the European Commission is set to increase in 2035. End-of-life recycling programmes aim to close the loop by bringing 90% of the cobalt, copper, lead and nickel, and 35% of the lithium back into the EU production cycle – and also help the EU advance its ‘strategic autonomy’ ambitions by becoming less dependent on third countries for these materials.

Batteries will also receive a carbon footprint label with every battery’s environmental impact having to be declared by 2024, the methodology for which the Commission will establish in a delegated act. By 2026 the Commission will divide batteries into performance classes, similar to the labels we know for household appliances and building energy efficiency. And by 2027 it will push this further by setting benchmark values for the battery ‘carbon passport’ and maximum CO₂ thresholds for batteries on the EU market through delegated acts. This will essentially determine which batteries are green enough to be sold on the EU market and which are too dirty and will be banned.

The legislative proposal would also oblige battery producers to set up a system of controls, transparency and traceability in their supply chain, in line with international rules such as the OECD Due Diligence Guidance. Evidence of appalling working conditions in some resource-rich countries have demonstrated the urgency for responsible mining rules in complex earth and minerals supply chains, as we reported on in July. This plan shows that the EU is serious about such due diligence for the battery value chain – and it needs to be, otherwise its stated transition to a more sustainable economy will lose all credibility.

EU relations with Africa will be especially crucial because of the high concentration of raw materials on that continent. The EU-Africa summit in 2021 will increase the momentum for a new partnership model between both. In March the Commission published a blueprint to prepare this summit, emphasising the need for ’enhanced cooperation on a responsible raw materials sector, secure and clean industrial value chains, respecting ambitious environmental and climate standards’.

All these measures, properly applied, can add up to the EU setting the gold standard for green batteries. In another classic example of exterritoriality, the EU is pushing to raise the global bar on sustainable batteries based on EU rules.

If approved, this ambitious piece of legislation will also challenge the EU itself on its ability to properly enforce such complex and detailed rules. How will it police products that do not meet the necessary standards to enter the EU market? How will it prevent end-of-life batteries from being exported outside the union to circumvent recycling obligations? How will it control batteries’ carbon footprint and compliance with EU standards and ensure that illegal batteries do not flood the EU market?

The proposal will now be debated the European Parliament and member states in Council, which is expected to take about 18 months. The European Parliament and member states in Council, which is expected to take about 18 months. The new Portuguese presidency of the Council has already indicated that the batteries proposal will be one of their top priorities in building a carbon-neutral Europe. Once agreed the text will become law, so stakeholders will want to keep a close eye on how discussions develop and ensure their voices are heard too.