In an update to its 2019 study, the Faraday Institution, which is based at Harwell Campus near Oxford, is predicting that there will be demand for seven UK-based gigafactories (large, high volume battery manufacturing facilities) by 2040, each producing 20 GWh per year of batteries. The Faraday Institution is the UK’s independent institute for electrochemical energy storage science and technology, supporting research, training, and analysis.
The transition to electrified transport is essential to meet Net Zero commitments and the size of the economic opportunity provided by this change is significant. The Faraday Institution study forecasts that the overall industry workforce in the automotive and electric vehicle (EV) battery ecosystem could grow by 29% from 170,000 in 2020 to 220,000 employees by 2040.
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But despite the UK having a competitive business environment for attracting prospective battery cell producers, the study finds that the UK is at increasing risk of falling behind Europe. Battery manufacturing capacity in continental Europe will reach nearly 450 GWh per year by 2030. Establishing a major UK battery cell manufacturing capability will be essential for the UK automotive industry to remain competitive as the world transitions to EVs.
“The UK is well placed to exploit the economic opportunities that the shift to EVs presents,” said Neil Morris, CEO of the Faraday Institution.
“The UK is the fourth largest vehicle manufacturer in Europe, with nearly a decade of experience of EV battery cell and pack production at Europe’s first battery factory in Sunderland.
“We have a productive and skilled labour force, world-class research and development capability, a government that has made a significant investment in battery research, and a growing supply of clean energy.
“The UK has a head start in the race to electrification as well as the economic ingredients for success. But a concerted effort is now needed by government and business to capitalise on the economic opportunity.”
The report recommends that the UK needs a timely and coordinated effort by government and industry leaders to attract the first gigafactory to the UK, and in particular to provide investors with enough time for site selection, approvals, planning and construction to meet mid-2020 demand for batteries:
- Details are required for the £1 billion pledged by Government in October 2019 to “develop and embed the next generation of cutting-edge automotive technologies.”
- Further moves to establish coordinated, ambitious and centralised leadership on this issue.
- Continue to communicate the attractiveness of the UK as a global and regional battery manufacturing location.
- New efforts to de-risk the business case by undertaking prospective site selection, the pre-approval of relevant permissions, the construction of basic on-site physical (especially energy) infrastructure and the development of the requisite EV battery skills and training infrastructure.
Key changes to the Faraday Institution’s 2020 forecast relative to the 2019 forecast are:
- Demand for UK EV battery manufacturing capacity of around 140 GWh per annum in 2040 (2019 report: 120 GWh per annum).
- The overall industry workforce of the automotive and EV battery ecosystem would grow by 50,000 jobs from 170,000 to 220,000 employees by 2040 (2019 report: growth of 60,000 jobs from 186,000 to 246,000 employees by 2040).
- The typical size of a gigafactory is assumed to be 20 GWh p.a. (2019 report: 15 GWh p.a.). Recent developments suggest that the average capacity of a mature gigafactory has increased by 5 GWh p.a.
- Our new forecast is therefore for demand for seven UK gigafactories in the UK by 2040, with each factory having a manufacturing capacity of 20 GWh p.a. on average (2019 report: eight gigafactories producing 15 GWh p.a.).
The first phase of the Faraday Institution is funded by the Engineering and Physical Sciences Research Council (EPSRC) as part of UK Research and Innovation through the government’s Industrial Strategy Challenge Fund (ISCF). Headquartered at the Harwell Science and Innovation Campus, the Faraday Institution is a registered charity with an independent board of trustees.
The ISCF Faraday Battery Challenge is to develop and manufacture batteries for the electrification of vehicles – £274 million over four years – to help UK businesses seize the opportunities presented by the move to a low carbon economy. The challenge comprises three elements: research, innovation, and scale-up.