Meeting 90% of EV Battery Demand with Domestic Production by 2030
Europe has the potential to achieve this goal. The Net Zero Industry Act sets an ambitious yet feasible target, but success is far from guaranteed. The pace of battery production must match the rapid growth of solar and wind power seen in the 2010s. Otherwise, significant production shortfalls could emerge as early as 2025 in half of the projected scenarios.
This is the conclusion of a study conducted by the Fraunhofer Institute. Published in Nature Energy, the analysis is based on probabilistic models that factor in the rising demand for EV batteries as well as investment barriers and challenges in scaling up production.
The EV Battery Demand Scenario: Over 1 TWh by 2030
Europe’s transition to electric mobility is accelerating, driven by decarbonization targets and the planned phase-out of internal combustion engines by 2035. According to the study, demand for high-energy-density batteries—those used in electric vehicles—will reach 1.0 to 1.2 TWh per year by 2030 in 80% of the scenarios analyzed. In the most optimistic cases, with rapid EV adoption, demand could surge to 1.6 TWh per year.
For perspective: 1 TWh is enough capacity to power 1.5 to 2 million mid-sized electric cars (each equipped with a 60-80 kWh battery). This exponential growth (+31-43% annually) reflects not only the rise in EV sales—expected to make up 70% of the car market by 2030—but also the expansion of stationary storage solutions and commercial vehicle electrification.
EV Batteries Production: Between Ambition and Reality
Currently, Europe has around 150 GWh of annual battery production capacity. However, with planned facilities, this could rise to 0.86-1.2 TWh per year by 2030. So, is everything on track? Not quite.
Only 39% of the scenarios analyzed in the study predict a sufficient production capacity to meet demand entirely. The biggest challenge? Achieving an annual production growth rate of 55-68%.
In 50% of the scenarios, Europe is projected to cover 80-100% of its internal demand by 2030. Some positive trends stand out, according to the researchers. The share of European companies in domestic EV battery production is expected to increase from today’s 35% to 45-55% by 2030, reducing reliance on Chinese giants like CATL and BYD.
Progress is also being made in reducing dependence on foreign supply chains for lithium, nickel, and graphite, thanks to advances in recycling and domestic mining. However, uncertainties remain. European demand for nickel, cobalt, lithium, and graphite is set to rise by 9-15 times by 2035. About 60-70% of lithium will still need to be imported from Australia and Chile, while cobalt will remain largely sourced from the Democratic Republic of the Congo.
Ultimately, the study concludes that 49% of the scenarios fall short of the 90% target, with risks of production shortfalls emerging as early as 2025.