Transparency and sustainability across the battery value chain
The 2015 Paris Agreement, negotiated by 169 parties at the U.N. Climate Change Conference, set the ambitious goal of keeping the rise in mean global temperatures to below 2°C. Seven years later, the need to take urgent and more intensive action to reach these goals is broadly recognized. One of the major near-term drivers to help achieve this in the transport and power sectors is the battery value chain. The International Energy Agency (IEA)’s World Energy Outlook 2021 argues that “batteries play a central part in the new energy economy.”
In fact, batteries could enable 30% of the required reductions in carbon emissions in the transport and power sectors, create 10 million sustainable jobs, and provide access to electricity for 600 million people that currently lack access. While this presents an incredible opportunity for the mining and metals industry, with metals like cobalt and copper forming key components of the lithium-ion batteries in EVs, we must ensure the sustainability of the sector does not suffer as a result.
The production of a rechargeable EV battery can pose significant social and environmental risks. At every stage of the process, from the mine to the electric vehicle, issues such as child labour, unsafe working conditions, and carbon dioxide (CO2) emissions can significantly impact the overall sustainability of the product.
Mitigating these risks is the primary objective of the Global Battery Alliance (GBA), the largest multi-stakeholder coalition of its kind, which brings together leading international organizations, NGOs, industry actors, academics, and governments to drive systemic change along the entire value chain. It now comprises around 110 members, including the OECD, UNICEF, Eurasian Resources Group, Tesla, and BASF, who are committed to creating a sustainable battery value chain by 2030.
To achieve this, the GBA is working on several key initiatives: the battery passport, the critical minerals advisory group, and ongoing projects on energy access, lead-acid batteries, and circularity.
One of the major difficulties with reducing the ESG impact of the battery supply chain is a lack of a standardized global reporting framework that covers the entire chain. Without establishing harmonized principles for digital traceability, access, and transparency, we cannot hold companies and nations accountable for their actions.
The GBA’s battery passport is a flagship initiative that aims to create a digital twin of the physical battery, giving consumers technical data about the battery as well as applicable ESG and lifecycle requirements, based on a comprehensive definition of a sustainable battery. Its role in underpinning a responsible battery value chain has been endorsed during global policy discussions, including the 2021 G7 leaders’ meeting, by the Canadian and U.S. administrations and in the introduction to the draft E.U. battery regulation.
Critical minerals advisory group
By virtue of providing the critical raw materials for batteries, minerals such as cobalt, nickel, lithium, and graphite are essential to the green transition. The World Economic Forum projects that the production of materials like graphite, lithium, and cobalt could increase by almost 500% by 2050 to meet rising demand for clean energy technologies. However, supplying these materials presents both challenges and opportunities.
In response to this, the GBA is launching the critical minerals advisory group (CMAG) in 2022, adopting a members-led and non-prescriptive approach to issue mapping. The CMAG will build on the success of the cobalt action partnership, a multi-stakeholder initiative convened under the GBA in 2020-21, dedicated to eliminating child and forced labour from the cobalt value chain. By working with members across the value chain, the CMAG will ensure that critical minerals are sourced, processed, transported, manufactured, and recycled in a responsible and just manner.
Energy access and circularity
Batteries are crucial to helping the nearly 550 million people in Africa who lack access to electricity. As a source of clean and reliable energy, batteries can significantly support Africa’s energy access goals and as part of microgrids and off-grid solutions, especially in sub-Saharan Africa.
Alongside this, a GBA whitepaper on recycling found that access to information on battery usage and end-of-life metrics could lower the costs of repurposed batteries by around 20%, reduce hazardous waste accumulation, and create numerous job opportunities. The GBA is also working to maximize batteries’ end-use potential by promoting circular design improvements and ensuring stronger market incentives toward recycling.
Throughout its entire lifecycle – from the raw material to production processes, use, and recycling – the battery value chain has the potential for both harm and good. It cannot only support the fight against climate change, but also create new safe jobs, add economic value, and safeguard human rights in line with the U.N. sustainable development goals. With battery demand set to explode over the coming decade, businesses, governments, and NGOs must urgently renew their efforts to ensure the value chain is scaled up in a responsible, circular, and sustainable manner.
Benedikt Sobotka is the CEO of Eurasian Resources Group and co-chair of the Global Battery Alliance.