Richard Moore, battery strategy expert at Greenpower Park – the West Midlands-based centre of electrification and clean energy, on why the next government needs to take urgent action to attract global battery manufacturers to the UK.

Richard Moore, battery strategy expert at West Midlands-based Greenpower Park

The UK urgently needs to acquire a security of supply for battery cells to ensure the country meets the massive power demands as the world transitions to electric energy use and storage. It’s a huge challenge and so far we are behind many other countries in our response to it.

The UK has got to get its head out of the sand if it thinks it’s going to hit its battery cell targets. The Government and stakeholders have been slow to react to battery cell supply demands and if we don’t take action now, there will be a major risk to the security of energy supply, which will leave the nation in a perilous state.

Currently, here in the UK, we have one operational gigafactory – AESC – which is producing up to 6GWh of energy per year. That’s all. According to the Faraday Institution’s 2022 gigafactory report, to support the automotive industry alone, the UK will need 100GWh per annum by 2030 and this is expected to double to 200GWh by 2040.

As we move to electric energy there will be a massive increase in demand to meet multiple needs, heating our homes and powering road transport to eventually even the flights we take. The demand crosses multiple industrial sectors outside of automotive and we need the security of supply to guarantee we can source battery cells to meet it.

But this is not the first time the UK has faced a resource crisis. We ramped up steel supply in the 1940s and 50s to build and replace military and civil equipment and can draw a parallel from this with battery cell demands today. And if we act now, we can still resolve the crisis.

Lessons from history

During the Second World War, demand for steel increased dramatically and by the mid-1940s the UK had to ramp up supplies to build and replace military and civil equipment, resulting in the collection of 110,000 tonnes of scrap metal per week. In addition, the UK government quickly nationalised and developed steel mills to meet demand – one of which was Ebbw Vale in South Wales, which in 1948 became the biggest steel plant in Europe due to government intervention. Then, throughout the 1950s, steel supply increased, and the Government ensured a ‘security of supply’ and still does now – even though it isn’t a price-driven market since the steel crisis in the 70s.

I believe we can draw a parallel with what happened with the steel industry during the middle of the last century, and the situation with battery cell supply today.

Most other countries in Europe have already figured out the challenge they are facing and have started building their security of supply – there are far more operational and planned gigafactories in the rest of Europe than in the UK. We can see this gap and urgency from the way the European gigafactory footprint is being deployed for example. It’s been underpinned with government support to incentivise the existing cell suppliers to move there to countries such as Germany, Poland, Spain, Norway, Hungary and the Netherlands – and the incentives used are significant.

To future-proof battery cell supply in the UK in the same way as steel was almost 70 years ago, we need to invest in startup gigafactories and at the same time become competitive in the global market by attracting global cell suppliers to the UK with fiscal, sustainable and recruitment incentives.

Greenpower Park, the UK’s Centre of Electrification and Clean Energy, is a trailblazing centre of excellence for electrification, battery technology and manufacturing. With the West Midlands Gigafactory as its anchor tenant, it has unrivalled access to the most highly skilled workforce in the country.

This ground-breaking location is the first of its kind, offering an all-in-one solution for battery research, industrialisation, manufacturing, testing, recycling and electrified logistics designed to foster the UK’s growing battery ecosystem.

Based in the country’s automotive skills heartland, it is at the epicentre of the country’s shift to electrification and is synonymous with both electric vehicle and battery manufacturing.

The automotive and manufacturing industries run through the blood of generations of the workforce in the West Midlands and will continue to do so in the future with the creation of Greenpower Park. Sitting closer to almost every car manufacturer plant than any other proposed gigafactory in the UK, it will have direct access to a net zero transport and logistics infrastructure. This makes it an extremely attractive project for UK government investment and for attracting global battery cell suppliers. Greenpower Park is part of the answer to the battery cell demand issue that we will face in the next decade.

We need to take action today, and that involves laying out incentive packages to accelerate conversations with potential investors – in order to achieve our goals within the battery manufacturers’ investment timescales.

The three key solutions to hitting battery cell targets in the UK

The UK can demonstrate that it has the right people at the right costs with the right skills and training programmes, which makes us competitive in the global market. Although our labour costs may not be as competitive, our level of training is stronger, which balances it out – enabling us to act faster. Greenpower Park perfectly fits the bill here, we just need more investment to get the job done.

Green energy is no longer a ‘nice-to-have’ offer for customers – many industries are now fully committed to sustainable power sources. In fact, clean, renewable energy is a must to be competitive in the global market and Greenpower Park will be powered at 100% sustainable energy, with opportunity for onsite solar power to boost this.

Finally, fiscal incentives. We need to lay out our fiscal incentives – at a national and regional level – to global cell suppliers and their associated supply chain in a way that meets their assessment criteria. Our incentive policy needs to be broader beyond the automotive industry as we know that future demand will be in multiple sectors. It’s a seller’s market and we need to know what our competition is offering so we can match or better that offer, have a strong position and start dialogues with cell suppliers.

These three solutions will help us catch up fast and compete with the rest of the world.

Holistic solution

But to make this work, the individual solutions need to be deployed in parallel. If we work together we have a much stronger strategy.

An existing global cell supplier that already has a security of supply and is a known entity could be the stepping stone for the UK, and could accelerate the ability of start-ups to achieve their goals.

If we can incentivise global cell suppliers to the UK, support developing start-ups and guarantee green energy at the same time, then together we can gain a UK security of supply of battery cells and power the future.

The Industrial Revolution in the 19th century saw the transition to new manufacturing processes in the UK, continental Europe, and the United States. This included new chemical manufacturing and iron production processes and the UK led the global market for the first half of the 19th century. Then came the Second Industrial Revolution in the late 19th century when the UK realised steel was cheaper than iron and so prioritised the mass manufacture of that commodity.

And now, here we are in the Electric Revolution and the Faraday Institution highlights a global shortage of raw materials for battery cells over the next 30 years which, inevitably, is the UK’s next demand challenge.

To get this right, we need to face the facts and recognise that the UK automotive industry alone needs 100GWh power per annum by 2030. We currently have approximately 6GWh from our only operational UK gigafactory – AESC. With the right market conditions, Greenpower Park could support 60% of the UK’s automotive power demands in 2030. But where will we find the rest?

Learning lessons from the UK’s response to the steel supply crisis in the 1950s and 40s, can spur the country on to act with the urgency required to ensure security of supply with battery cells. To be competitive, we need support from the UK government and stakeholders for investment in our startups and we need a strong proposal to offer global cell suppliers. Then, together, we will achieve net zero, deliver electrified growth in the UK and avoid another supply crisis.