What to Expect From Growing Battery Market Investments

As the need for batteries for electric vehicles and energy storage skyrockets, gigafactories are ramping up production. Multiple factors are driving the sudden demand for batteries — emissions laws, government incentives to use renewable energy, subsidies for automakers and an increasingly eco-conscious public. What will this mean for sustainability?

Shifting Into High Gear

In recent years, the United Kingdom has taken an interest in battery manufacturing. Strong government support and increasing private investment are spurring the market forward, bolstered by explosive growth in electric vehicle (EV) purchases.

In 2016, the UK saw just 10,250 battery EV sales. In 2023, that number jumped by 2,286% for a total of 244,600 sales. With people clamouring for electric cars, it’s no wonder so many investors are betting on the battery market.

The UK only has plans for a few large-scale battery manufacturing plants — called gigafactories — but smaller battery manufacturers are already popping up. AMTE Power operates one of those plants and intends to scale up production to 10 GWh in the future. Undeterred by hopeful battery manufacturer Britishvolt’s failure to materialise, other U.K. battery factories in development include the West Midlands Gigafactory and Envision AESC Gigafactory.

Localised battery production could lower the cost of EVs in the long run and further increase demand, creating a positive feedback loop. It will also create a domestic energy market that’s less reliant on foreign oil and gas. That could improve national security and create more stable energy prices in the long run.

Driving Sustainability

As the growing battery market makes EVs and home solar storage more affordable, air pollution is set to decrease. In contrast to diesel- and petrol-powered cars — which emit toxins and particulate matter into the air — electric vehicle batteries run purely on electricity and produce no air pollution. Adopting them will be key to meeting the UK’s sustainability goals and improving human health, which is why the nation has banned the sale of conventional petrol and diesel cars by 2030.

Additionally, having cheaper batteries means home storage solutions will become more affordable, likely encouraging people to use solar panels. Although 4.6% of U.S. households use propane to heat their homes, millions still rely on toxic gas- or wood-burning stoves, contributing strongly to air pollution and lung disease. The rest use fossil fuels or nuclear energy for power, which contribute to environmental and health risks. Solar-powered electricity is clean.

More Battery Waste

One unfortunate but expected side effect of increased battery production will be a growing need for recycling. Lithium-ion batteries go through around 500 charge and discharge cycles before breaking down. Currently, the UK has no industrial facilities for recycling spent lithium-ion batteries, so the nation ships most of them to mainland Europe.

This process is expensive and makes it harder to recoup the cost of manufacturing the batteries in the first place. It also means the UK loses the valuable metals inside the batteries rather than reclaiming them.

Consequently, several companies are vying for a position as the UK’s first EV battery recycling facility. Investors are closely monitoring the RECOVAS Project, which aims to create a circular battery economy in the UK. A circular economy means being responsible for a product from its creation to disposal, recycling it so it can reenter the supply chain.

The Battery Boom Is Just Getting Started

Thanks to unprecedented environmental interest, investors are pouring money into storage solutions and EV batteries. Electric cars and renewable energy offer hope of a cleaner, more eco-conscious society that doesn’t revolve around fossil fuels. Batteries are just one piece of that puzzle. If the nation continues on its current track, the UK looks poised for an electric future.