By Yusuf Khan

 

The U.K. needs to up its battery-production capacity over the next decade in order to meet rising demand for electric vehicles, according to U.K.-based research center The Faraday Institution.

Expected battery-production capabilities in Europe have risen sharply over the last two years, with 1,100 gigawatt-hours per year now expected by 2030 from the 450 GWh guided in the institute's 2020 outlook for the market.

But demand for electric vehicles--and therefore batteries--is also expected to jump, leaving the current capacity levels short of what is required, especially in the U.K.

"The U.K. is making progress but not moving fast enough compared to its competitors in Europe and beyond," the report from the research center said.

It added that demand for U.K. EV battery-manufacturing capacity will reach over 100 GWh per annum in 2030, mainly from private cars, vans and small trucks. "This demand is the equivalent of five large gigafactories running at full capacity, but at present there are only two substantial U.K. plants in the pipeline." Comparatively, 12 EV cell-producing factories, or gigafactories, are open or planned in Germany.

The Faraday Institution noted that gigafactories take at least five years to reach operational capacity, so investment and location decisions to meet battery demand in 2030 are all likely to be made in the next two to three years.

The U.K.'s battery demand could rise to nearly 200 GWh by 2040 - which would require 10 gigafactories - according to the report. This would be especially needed if heavy-duty vehicles start to move to electric fuel cells.

Britishvolt has started construction on a 38-GWh plant in Northumberland, while a second plant from Envision AESC also received planning permission for a 11-GWh facility in Sunderland. Two more sites are also planned by 2025.

"Globally, there are now around 300 gigafactories and 6,400 GWh of lithium-ion battery capacity in the pipeline," the report noted.

The Faraday Institution also said the opportunity for the U.K. wouldn't be limited to just lithium-ion battery chemistries but also solid-state, sodium-ion and lithium-sulfur which would "offer exciting opportunities through applications in marine, rail, aviation and heavy goods transportation."

It added that the U.K. government's policies such as net zero legislation or the 'Ten Point Plan for a Green Industrial Revolution' were important steps in attracting investment to the region and encouraging a battery economy.

 

Write to Yusuf Khan at yusuf.khan@wsj.com

 

(END) Dow Jones Newswires

June 23, 2022 07:39 ET (11:39 GMT)

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