A comprehensive analysis on EU batteries regulation: lifecycle decarbonization, business challenge and compliance risk

The REGULATION (EU) 2023/1542 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 12 July 2023 (short as “EU Batteries Regulation”) presents both a challenge and an opportunity for battery manufacturers and operators as they must not only navigate market competition and changes but also comply with new regulatory requirements. However, this also presents an opportunity to stimulate the growth of the battery industry and foster the sustainable development of the electric vehicle sector. This paper is one of the first attempts to develop a life cycle–based analytical metric that provides a comprehensive examination of the change of policy & regulation boundary of the newly implemented regulation, and the associated impacts on environment (in term of life-cycle phase-based carbon footprints), business (both opportunities and risks), and compliance practice. This metric is created based on a comparison of the new EU battery regulation with previous ones. Utilizing this metric, we employed firsthand data from two major battery manufacturers to illustrate the aforementioned points. Finally, we provided policy recommendations and discussions on the impact of this battery regulation on both EU and emerging economies, to offer insights for the future.