Battery Raw Materials: Europe Subsidizes its Independence

Germany and its neighboring countries are providing considerable financial resources to support the establishment of a European production of battery cells for electric cars. In concrete terms, this involves so-called IPCEIs or ''Important Projects of Common European Interest.'' The German Federal Ministry of Economics defines an IPCEI as an ''important project of common European interest that makes a significant contribution to the growth, employment and competitiveness of European industry and business by means of state funding.''

The EU already approved its first battery IPCEI last year and promised 3.2€ billion in subsidies. BMW, a car manufacturer, BASF, a chemical company, Varta, a battery manufacturer and others are involved in the project. According to the EU Commission, a second consortium is nearing completion and could receive the green light before the end of this year.

The massive European and national subsidies are having their desired effect. By now, the production of battery cells for electric cars is being ramped up on a arge scale in Europe. In mid-November SVolt, a Chinese manufacturer, announced its intention to build a battery cell factory in the German state of Saarland. This plant alone will have a capacity of 24 gigawatt hours (GWh) and would thus be almost as large as the gigafactory of Panasonic and Tesla in Nevada.

Only a few days later the Americans followed with an even bigger bang. At the "European Conference on Batteries", Tesla announced by video call that it wants to produce not only electric cars in Germany but also batteries -and on a huge scale. According to Elon Musk, the largest gigafactory in the entire Tesla group will be built on the outskirts of Berlin with an initial capacity of 100 GWh! The German Minister of Economics, Peter Altmaier, added: "If it becomes the largest one Tesla has ever built, you can calculate that it will be a considerable subsidy."

More IPCEIs in planning

However, the EU does not want to stop at promoting gigafactories for battery cells. On the one hand, European production of green hydrogen is to be boosted with wind and solar parks providing the necessary energy. On the other hand, the European Raw Materials Alliance (ERMA) is to be supported. This alliance works to make Europe more economically independent by securing critical raw materials and diversifying supply chains. One of the main objectives is to secure access to the primary and secondary raw materials needed for an environmentally sound industry. Up to10€ billion are under discussion for funding this project.

ERMA is made up of dozens of representatives from industrial companies, politics and associations. Rock Tech Lithium is also a member of the alliance. This follows an inner logic. After all, in order to establish autonomous production of electric cars in Europe, it is not only necessary to have secure access to the battery cells but also to the battery raw materials needed for them. Rock Tech Lithium is predestined for exactly this. Its lithium deposit in Ontario, Canada, is located in one of the most politically stable countries in the world, from which the EU can obtain many raw materials and is currently establishing partnerships. The same applies to the planned construction of a converter in Germany. In this context, we have been holding talks on government support measures for some time now. Tesla is illustrating what is possible here with the construction of its car and battery cell factory near Berlin.

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