EU LFP Market
In addition to being inexpensive and safe, LFP batteries have several advantages such as high cycle life, good thermal stability, and better performance at low temperatures compared to other lithium-ion batteries. While LFP battery manufacturing has been mainly in China in recent years, Europe has recently announced that many automakers will develop and use LFP batteries, indicating a growing interest in this technology in the region.
LFP Market in EU
EU Carbon Reduction
The EU's goal of reducing carbon emissions to improve the environment is relevant to many policy areas, including transport, climate action, and waste-to-energy/resource initiatives. The issue of batteries is particularly important, as they play a crucial role in zero-emission mobility and intermittent renewable energy storage, making them a key element in the EU's transition to a climate-neutral economy. Additionally, batteries play a critical role in powering the growing digital economy and an increasing number of portable electronic devices.
Growing Battery Demand in EU
Due to the electrification of transport and the increasing deployment of batteries in the power grid, EU battery demand is expected to increase 14-fold by 2030. This increase in demand is expected to drive the battery market to reach 250 billion euros per year by 2025.
EU choose LFP
While the EU has been prioritizing the use of nickel-rich chemicals in developing electric vehicles, there has been a growing trend of automobile companies adopting LFP batteries. Aside from the cost advantage, stability has become a major factor in this shift towards LFP. There are concerns about potential shortages of raw materials like cobalt and nickel, which are essential in manufacturing NMC batteries, leading to further interest in LFP batteries.
Needs to boost LFP in EU
The lithium-ion battery market is currently dominated by Asia, which holds over 70% of the market share. As the EU is heavily reliant on imports of LFP from Asia, it needs to build a competitive LFP ecosystem for its automotive industry. Additionally, with a growing need for renewable energy and energy storage solutions, the demand for LFP is expected to rise. Therefore, the EU is planning to promote the development of its domestic LFP industry to foster its local production and reduce reliance on imports.
