Carbon footprint ▏ Power battery exports to Europe to meet "new challenges"

For companies that plan to export batteries to Europe, or build power battery R&D and production bases in Europe, they can start preparing for a job now: the construction of a battery carbon footprint system.

On January 26 this year, the European Union notified the WTO (World Trade Organization) of the "Proposal for Regulations on Batteries and Waste Batteries", which raised the current battery control method from "directives" to "regulations" to ensure that batteries placed on the EU market are Become sustainable, high-performance and safe and reliable throughout the entire life cycle.

The new regulations are scheduled to come into effect on January 1, 2022. It is reported that the new regulations will not only affect self-produced batteries in all EU member states, but also apply to imported batteries.

It is worth noting that the new regulation adds carbon footprint, recycled raw materials, electrochemical performance and durability, detachability and replaceability, QR code label and CE label, battery management system, battery passport, Safety and other requirements, and put forward new requirements for due diligence of operators and recycling and disposal of used batteries.

According to Battery China, the carbon footprint of power batteries will be implemented in stages: first, information disclosure is required, then grading, and finally mandatory limits are set.

Implementation steps of the carbon footprint of electric vehicle power batteries in the EU

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That is to say, from July 1, 2024, only related products that have established a carbon footprint statement can be put on the market.

The new regulations require that the carbon footprint of batteries must be verified by a third party.

What is a carbon footprint? For most people, this is a new term.

Carbon footprint refers to the total greenhouse gas emissions directly or indirectly produced by individuals, organizations, events or products, and is used to measure the impact of human activities on the environment.

Generally speaking, the carbon footprint of a product is the summary of carbon emissions during its life cycle (raw materials, manufacturing, storage and transportation, sales, use, disposal and recycling).

It is worth noting that the carbon emissions in the whole process of the product include not only the product itself, but also the carbon emissions in the supply chain.

For battery products, the carbon footprint not only refers to the carbon emissions in the manufacturing process, but also includes the summary of carbon emissions in the upstream materials manufacturing, transportation and other links. This requires battery companies not only to reduce carbon emissions in the production process, but also to require the various materials used to meet the carbon footprint requirements, such as the carbon footprint information statistics and use of the four major upstream materials.

In this case, the carbon footprint control, refinement, execution and recording of the entire industrial chain is very necessary.

In fact, in addition to the requirements of the new EU battery regulations on the battery itself, in the future, under the requirements of carbon emission regulations, vehicle manufacturers must also have carbon footprint-related management rules. As a link in the upstream supply chain of vehicles, power batteries, It must also meet its requirements.

For example, in March this year, the BMW Group announced that their plants in Dingolfing and Munich will use 100 percent local green hydropower to power the production of the new electric BMW iX and BMW i4. Milan Nedeljkovi, BMW Group board member responsible for production, said: "We are not just minimizing emissions from driving, but are committed to significantly reducing the carbon footprint of the production process. In the future, it is expected that the BMW Group will also include power batteries from suppliers into relevant management, and require the power batteries provided by suppliers to also meet the relevant requirements of the EU carbon footprint.

In fact, under the background of the global carbon neutrality goal, overseas battery companies have already sensed the impact of this policy change and are preparing for the carbon footprint of batteries in advance.

In July 2020, LG Chem announced its strategy of "Carbon Neutral Growth by 2050", proposing to promote 100% use of renewable energy (RE100) in all factories around the world.

Europe is the main market for power batteries of LG New Energy (a subsidiary of LG Chem). In the face of the upcoming EU battery regulations, LG New Energy is promoting the manufacture of batteries and upstream materials to minimize carbon emissions.

Taking LG New Energy's production in the Chinese market as an example, in December 2020, LG Chem's cathode material factory in Wuxi, Jiangsu - Leyou New Energy Materials (Wuxi) Co., Ltd. and a local wind and solar power generation company - Jiangsu Runfengxin Energy Co., Ltd. signed a power purchase agreement for the supply of 140GWh. From 2021, LG Chem's Wuxi cathode material plant will only use renewable energy; Energy power generation, and then LG Chem's battery material factories in China will achieve more than 90% carbon neutrality.

It is understood that the precursors and cathode materials produced by LG Chem's Quzhou and Wuxi factories are all supplied to the Nanjing battery factory of its subsidiary LG New Energy and the battery factory in Wroclaw, Poland.

According to LG Chem, “There is almost no direct carbon emission in the production process of battery precursors and positive electrode materials. Therefore, all the electricity used for production is ‘green electricity’, which can achieve more than 90% carbon neutrality.”

In May of this year, LG New Energy, Nanjing Jiangning Binjiang Development Zone Management Committee and Huaneng International Power jointly signed a three-party renewable energy supply cooperation agreement. Huaneng International Power and Binjiang Development Zone will jointly build the Huaneng Binjiang Comprehensive Energy Project. Provide "green electricity" for enterprises settled in the park, including LG New Energy.

LG Chem's approach in the Chinese market may be to respond to future policy requirements from Europe and other countries on carbon emissions and carbon footprints in battery manufacturing, and to prepare in advance to avoid being excluded from the relevant market due to "policy factors" .

In the next few years, "carbon footprint" may be an important competitive weapon in the global market, which may affect the entry of battery companies into relevant international markets. For many battery companies that are about to leave Europe, North America and other international markets, it should draw enough attention.

New energy vehicles and power batteries are one of the important ways to achieve the national goal of "carbon peaking and carbon neutrality". How to ensure the reduction of carbon emissions of new energy vehicles and power batteries is particularly critical.

Under the global "double carbon" strategic goal, battery companies should think and prepare in advance.

Battery China learned from relevant sources that domestic battery companies such as Ningde Times, BYD, Honeycomb Energy, and AVIC Lithium Battery have recently built power battery production bases in southwest regions such as Sichuan and Chongqing. One is to seize the new energy vehicle market in Southwest China; Lithium power resources and industrial chain supporting facilities in Southwest China are relatively abundant; third, the local area has the advantage of low-cost electricity prices; fourth, the power used for power battery production is mainly hydropower, that is, "green power", which can greatly reduce power battery production. Carbon emissions in the environment, to achieve a higher efficiency of carbon neutrality.

According to people familiar with the matter, Ningde era will use Yibin power battery production base as an important base for export to Europe in the future, and the batteries produced by using the "green electricity" in the region should have this consideration.

Another battery company, Envision AESC, relies on the strong background of Envision Group in the fields of wind power and photovoltaics, and its Wuxi factory is building a smart energy industry based on distributed wind power, distributed photovoltaics, distributed energy storage, and electric vehicle charging piles. system, hoping to meet 70% of the green electricity demand of its factories and reduce the electricity cost of the park by 15%. According to Envision AESC, its goal is to achieve 100% renewable energy electricity use in the park by the end of this year, and then achieve 100% carbon neutrality in 2022.

Of course, the pressure to build a battery "carbon footprint" is not limited to battery companies. The carbon footprint runs through the entire life cycle of the battery, so upstream carbon traceability is equally important. This requires that upstream material links such as resource mining, precursors, positive and negative electrodes, electrolytes, and separators must also pay attention to carbon emission control. Traceable carbon footprint to achieve traceability and query throughout the entire life cycle. This requires domestic battery companies, especially leading companies, to play a leading role in guiding the domestic battery industry chain to build and improve relevant systems as soon as possible.

In the long run, in the next few years, the "carbon footprint" of batteries will also be a sharp weapon for companies such as batteries and materials to participate in international market competition. On the one hand, if the product carbon footprint system is standardized in advance, it will be easier to enter the supply chain of downstream vehicle and battery companies; on the other hand, in the future, domestic battery and material companies will export their products to Europe or build factories in Europe. You must do your homework in this area, otherwise, whether it is products entering the international market or building factories overseas, you may face considerable difficulties.