UK will have demand for 10 20GWh/year gigafactories by 2040: Faraday

The UK is expected to have enough demand for 10 20 GWH/year gigafactories by 2040, according to an updated study from the Faraday Institution.

Around 100 GWh of supply, or the equivalent to five 20 GWh/year gigafactories, will be needed in the UK by 2030 to satisfy the demand for batteries for private cars, commercial vehicles, heavy goods vehicles, buses, micromobility and grid storage, and this demand is set to double to nearly 200 GWh by 2040.

Currently, only two gigafactories are being planned in the UK: Britishvolt's 30GWh gigafactory, which is already under construction in Blyth, Northumberland, and Envision AESC's 9 GWh plant at the International Advanced Manufacturing Park in Sunderland.

"The UK needs to move quickly to secure investment in new gigafactories," the institute said, adding that while the government had made "bold policy commitments" and increased investor confidence in the UK as a location to do business, Faraday said more needed to be done as the UK was lagging behind European competitors.

"UK battery manufacturing plants could reach a combined capacity of 57 GWh by 2030, equivalent to around 5% of total European GWh capacity, compared with 34% in Germany," Faraday said.

The transition to electrified transport is essential to meet net-zero commitments and the related economic opportunities are significant, with the combined electric vehicle automotive and battery ecosystem possibly worth GBP22 billion ($27 billion) by 2030 and GBP27 billion by 2040.

Battery opportunities

The UK was well placed to manufacture next generation batteries such as solid state, lithium-sulfur and sodium-ion technologies, Faraday Institution CEO Pam Thomas said, as it already had global experts in battery research and some well-established companies.

"We must move quickly to exploit this competitive advantage by establishing large-scale domestic manufacturing in the UK while continuing to fund long-term battery research," she added.

The institution called for the government to further communicate the attractiveness of the UK as a battery manufacturing location to investors and cultivate new investors.

The Faraday Institution said the UK had also identify prospective sites for gigafactories and the construction of associated physical, transport and energy infrastructure, as well as develop a strategy to create the conditions for a new lithium-ion battery recycling industry in the UK to flourish.

The government also had to help develop a resilient, sustainable and efficient supply chain, build up skills capabilities and training and commit to the long-term funding of research for cheaper, lighter weight, longer-lasting, safer, manufacturable and fully recyclable next generation batteries, Faraday said.

"The move to electrify transport and toward large-scale battery production represents a massive shift in industrial skills," Faraday Institution Chief Strategy Officer Matt Howard said.

"The UK's engineering and manufacturing workforce can gain a competitive edge over other countries through the provision of a national training curriculum that will ensure the right skills are delivered at the right time."

Ban on new gasoline, diesel cars

The UK government plans to ban the sale of new gasoline and diesel cars by 2030 and heavy goods vehicles by 2040, and the Faraday Institution expects the UK automotive industry to manufacture around 1.8 million private cars and commercial vehicles in 2040.

Plug-in light duty EV sales in the UK are expected to total 1.3 million units in 2030 and 1.6 million units in 2040, according to Platts Analytics.

Higher EV demand has been boosting battery metals prices, with the assessment by Platts, part of S&P Global Commodity Insights, of spot battery-grade nickel sulfate with minimum 22% nickel content and maximum 100 ppb magnetic material rising 23.3% since the start of the year to Yuan 41,800/mt ($6,230.25/mt) DDP China on June 23.