Select committee: Business, Innovation, Science and Trade Committee
Recommendation 2
First Report - Batteries for electric vehicle manufacturing
Published 21 Nov 2023
Paragraph 17
Addressed to Department for Business and Trade
Business, Innovation, Science and Trade Committee Batteries for electric vehicle manufacturing All items in this report Report on parliament.uk ↗ Inquiry on parliament.uk ↗
Recommendation (the committee's words)
The UK needs gigafactories that can cater for the diverse array of vehicles, including luxury cars, public transport and commercial vehicles, manufactured in this country. Retaining niche segments of the automotive market in the UK is strategically important, because the highly specialised nature of these vehicles provides an opportunity to encourage innovative battery manufacturers into the UK. The UK also has an opportunity to take the lead in supplying forms of transport (rail, maritime, aviation and micro-mobility) and sectors of the economy (e.g. energy storage and military applications), which are expected to see demand for batteries rise, especially from 2030 onwards. To capitalise on these opportunities, the Government should: • outline, in the Advanced Manufacturing Plan, what UK battery manufacturing capacity will be needed to cater for the diverse needs of niche segments of the automotive industry, and by when, together with the measures required to secure this. • support battery manufacturers looking to supply batteries to non-automotive sectors by stimulating demand for batteries in these industries and ensuring government support is available to manufacturers targeting these market segments.
From: Business, Innovation, Science and Trade Committee, First Report - Batteries for electric vehicle manufacturing (HC 196), paragraph 17, 21 November 2023
Government response
The government responded to the whole report on 14 February 2024 (deadline 21 January 2024).
Summary written by Accountability Index from the government's response. It is not the government's own words.The government's response sets out existing and announced support for batteries, while declining fixed supply-chain targets and a subsidy race and leaving offtake agreements to commercial parties.
- On the proposed 90% domestic supply target, the government says the Strategy has not set fixed targets, and that onshoring all aspects of critical mineral supply chains is not "possible (or even desirable)".
- On international competitiveness, it says the UK "won't be drawn into a distortive subsidy battle" and points to £2 billion of capital and R&D funding for zero emission vehicles, batteries and supply chains to 2030.
- On offtake agreements, it says these "remain a matter for the commercial parties involved to negotiate". On Tata's subsidy, it will publish details on the UK Subsidy Database "in due course".
- On battery passports, the response notes the Strategy's points on data and regulation, and commits to Defra consultations in 2024 and a UK Carbon Border Adjustment Mechanism by 2027, with design details "subject to consultation in 2024".