What You Need to Know About the Upcoming EU Batteries Regulation

In December 2020, the European Commission published a proposal for a new regulatory framework for batteries manufactured, distributed, and/or sold within the EU. The proposal was part of sweeping policy initiatives ushered in by the European Green Deal to transform the way batteries were sourced, manufactured, used, recycled, and reused in the EU’s 27 member states. This new legislation, called the Batteries Regulation, entered into force this past August. The law includes new requirements for labeling, hazardous substances, due diligence, and end-of-life management, among other categories. Although it entered into force in 2023, parts of it will be introduced in a staggered fashion over the remainder of this decade. 

Why the EU Batteries Regulation Is Being Implemented

It’s not difficult to understand why the Batteries Regulation came to be. Europe is undertaking a massive transition to a more circular economy, which includes advocating for carbon neutrality. Batteries play a big role in this–and their role is getting bigger as we incorporate them more and more into our lives. 

The growing electrification of the transportation, building, and industrial sectors will require a substantial increase in the production of several key battery types. To put this growth in perspective, the European Commission estimates that worldwide battery demand may increase 14-fold by 2030. 

As a result, the Batteries Regulation is largely an anticipatory measure. With it, the EU is helping to ensure that its member countries make a safe and sustainable transition to a more battery-dependent future. The European Commission succinctly captured the comprehensive ambition of the new law, declaring that it will “ensure that, in the future, batteries have a low carbon footprint, use minimal harmful substances, need less raw materials from non-EU countries, and are collected, reused and recycled to a high degree in Europe.”

Below, we’ll explore how this new legislation will shape battery production. 

New Battery Classifications Under The Batteries Regulation

The simplest place to start is with the way the EU classifies batteries in its new legislation. There are now five distinct categories of batteries.​​ The first three—portable batteries, industrial batteries, and starting, lighting, and ignition (SLI) batteries—appeared in the predecessor to the Batteries Regulation, known as the EU Battery Directive. In addition to those categories, the EU is introducing two new battery categories—electric vehicle (EV) batteries and light means of transport (LMT) batteries, which power e-bikes, e-scooters, and other similar small motorized vehicles. 

These categories serve as more than just a means of classification, as the specific regulations within the new EU battery act affect each group differently. 

Introduction of the Carbon Footprint Declaration

In keeping with the directive’s express intent to establish a more sustainable, circular battery industry, one of the key new regulations is the introduction of the carbon footprint declaration. The carbon footprint declaration requires manufacturers to report the life-cycle carbon emissions (excluding the use phase) for each battery model per manufacturing plant. It  applies to electric vehicle batteries, LMT batteries, and rechargeable industrial batteries with a capacity exceeding 2 kWh. The mandate will take effect in 2025. 

The EU Commission will also eventually establish what will be known as carbon footprint “performance classes.” Once these classes are set forth, companies will need to start including a label denoting the specific performance class of each of their batteries with the carbon footprint declaration requirements. 

Additional Focus on the Restriction on Hazardous Substances 

In addition to the efforts to reduce the carbon footprint of battery manufacturing in the EU, the new EU battery act will also focus on ensuring that the industry continues to use substances in a way that does not pose any direct threats to human health. To that end, the regulations impose several specific caps on potentially hazardous substances. 

Currently, the restricted substances include mercury, cadmium, and lead. This list, however, may expand over time. According to the European Commission, “substances of concerns used in batteries will be regularly reviewed.”

The EU Batteries Regulation and the Digital Battery Passport 

The EU will eventually require that a digital product passport (DPP) be affixed to products falling into one of around 30 different product categories. The first category to be affected by the new DPP requirements will be batteries. Specifically, EV batteries, LMT batteries, and rechargeable industrial batteries with a capacity greater than 2 kWh. By February 2027, these battery classes will have to include passports taking the form of QR codes that anybody can scan to obtain critical information related to the battery’s production and specifications.

So, what exactly should these European battery passports include? First, they must all contain general characteristics communicating the specific model of the battery, the name of the manufacturer, and the location of the facility where the battery was manufactured. In addition, the passports should provide data and statistics related to the battery’s performance, durability, and chemical composition. The passports must also include information sufficiently detailing how this data was obtained. 

One of the chief objectives of these digital repositories is to give consumers the opportunity to “look under the hood” of the various batteries on the market and quickly gain a comprehensive understanding of origins, quality, and battery life cycle. As the European Parliament and the Council of the EU explain, “batteries should be labeled in order to provide end-users with transparent, reliable and clear information about batteries and waste batteries.” These passports, in other words, will give European consumers a universal basis of comparison to use when purchasing batteries from these categories. 

For an industry and market set to explode in size and demand over the next half-decade or so, these are essential measures to promote transparency for all stakeholders and implement a new level of accountability throughout the supply chain. 

CE Markings for Batteries 

The CE mark has been a regulation requirement in Europe for some two dozen product categories since 1993. With the new Batteries Regulation, the EU is adding all five of the aforementioned battery categories to this list (portable, industrial, EV, LMT, and SLI). Making batteries a part of the CE marking requirements means that manufacturers are legally obligated to carry out a CE conformity assessment, which entails adherence to myriad requirements. These requirements—which vary depending on how the battery is classified—include data on the amount of recycled content the batteries contain and a battery management system (BMS) that tracks the battery’s health and lifespan.

Related Article: What's Changing for CE Markings with the 2023 EU Batteries Regulation?

It’s also worth briefly restating here that battery manufacturers are required to use a notified body to evaluate CE conformity for the majority of battery classes. Only companies producing portable batteries and industrial batteries with a capacity of less than 2 kWh may carry out a self-certification. 

Supply Chain Due Diligence Policy

Many of us associate the term sustainability with the adoption of strategies that minimize carbon emissions and reduce environmental harm. But the concept also entails developing and participating in a supply chain that is free of conflict, exploitation, forced labor, or human rights violations of any kind. In this context, practicing due diligence means carrying out the steps necessary to comprehensively assess one’s supply chain and identify and address any potentially negative impacts from the manufacturing or sourcing processes. According to the European Parliament and the EU Council, risk-mitigation measures may include “requiring additional information, negotiating with a view to redressing the situation, or suspending or discontinuing engagement with suppliers, in line with relevant standards provided under national and international law.” 

To achieve these sustainability goals, the EU battery regulation establishes new due diligence requirements for battery manufacturers and importers with a net turnover of at least 40 million EUR (companies falling below this threshold are exempt from these requirements). These new obligations are being set forth with an eye to the extraction and processing of specific raw materials essential for battery manufacturing. Materials listed by the European Commission include cobalt, natural graphite, lithium, and nickel. 

New Due Diligence Requirements Under the EU Batteries Regulation

Companies exceeding the minimum turnover and participating in the sourcing of raw materials used in their batteries—most notably one or more of the four resources mentioned above—must execute the following due diligence measures:

• Adopt a due diligence policy based on international standards and communicate that policy with suppliers.
• Devise and implement a management system to identify and assess social and environmental risks along the supply chain. (These risks are outlined in detail in Annex X of the Batteries Regulation.)
• Develop specific strategies to manage and resolve such risks. 

Finally, the EU battery regulation requires that these due diligence measures be assessed and approved via third-party verification. This verification process must be carried out by a notified body (organizations specifically designated by their EU country to carry out conformity assessments). These due diligence requirements will become obligatory for battery manufacturers and suppliers in the EU beginning in August 2025. 

Removability and Replaceability Requirements for Batteries

The new EU battery directive also introduces stipulations regarding the removability and replaceability of certain batteries. Specifically, companies bringing appliances to market that use portable batteries must ensure that these batteries are readily “removable and replaceable” by the end-user (i.e., the consumer). In addition, any products that use LMT batteries must be designed so that these batteries—as well as individual battery cells—can be removed and replaced by an independent professional. 

These removability and replaceability regulations will not come into effect until 2027, thereby ensuring that manufacturers have several years to modify their products to achieve adherence to these new laws. 

Battery Recycling and End-of-Life Management 

A key objective of the Batteries Regulation, and the European Green Deal more broadly, is achieving a more circular economy. This entails embracing methods for recycling and reusing while simultaneously drawing down practices that contribute to the accumulation of waste that has long defined contemporary society. A vital aspect of this effort is something called extended producer responsibility (EPR). EPR is an environmental policy measure that holds producers responsible for the full lifecycles of their products, including their waste disposal, collection, and recycling and reuse. 

In the context of the EU battery act, EPR means that manufacturers are responsible for the collection of waste batteries that might otherwise end up in landfills or other waste management facilities, as well as incorporating mandatory levels of recycled content into their battery production. The regulation’s collection targets, which gradually ramp up over the course of the decade, cover portable batteries and LMT batteries:

• For waste portable batteries, the target is for producers to collect 63 percent by the end of 2027 and 73 percent by the end of 2030. 
• For waste LMT batteries, the target is 51 percent by the end of 2028 and 61 percent by the end of 2031. 

In addition, producers must meet these mandatory minimum levels of recycled content for industrial batteries, SLI batteries, and EV batteries:

• 16 percent for cobalt 
• 85 percent for lead
• 6 percent for both lithium and nickel

To demonstrate compliance with these new EPR regulations, manufacturers will need to include recycled content documentation for each battery they produce. 

Final Thoughts on EU Batteries Regulation 

If the 27 nations that comprise the EU want to make a serious, good-faith effort to transform their collective economy through electrification and circularity, to the point where carbon neutrality is achieved by the middle of the century, then the role of the various battery classes discussed here cannot be overstated. Given that the demand for these batteries is all but certain to increase substantially over the years and decades to come, the EU is acting with prudence and foresight in overhauling its regulatory framework for these critical cogs of a more sustainable future. 

From the perspective of companies that manufacture and market batteries in the EU—not to mention the countless businesses that produce electric vehicles, e-bikes, and other battery-dependent technologies—the yearslong rollout of the Batteries Regulation offers a good opportunity to transition their operations into a new era. This period will require higher levels of accountability and transparency for all stakeholders; a commitment to gathering, preserving, and communicating data; and a comprehensive plan for meeting the increasingly high demands of EPR. Strategies and platforms that can help companies enhance their supply chain management (SCM) and visibility will be an integral part of the adaptation process. 

The plethora of forthcoming regulations and requirements are bound to shake up the battery industry landscape. Companies unprepared or otherwise ill-equipped to rapidly adapt to the new directives will find themselves shedding market share and losing out on the explosive growth the sector is on the precipice of. Businesses that can consolidate and harness their data, enhance their internal circularity protocols, and foresee the way digital battery passports are going to revolutionize the relationship between consumers and businesses, on the other hand, will find themselves operating with a considerable competitive advantage.