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In 2020, the European Parliament and Council agreed to review the existing Directive 2006/66/EC, also known as the Batteries Directive, in light of the changes in the market related to batteries and waste batteries. In this article, we look at why this is an important development and what it means for companies.
The Batteries Directive was proposed in 2006. It regulates the management of hazardous wastes from the manufacture and disposal of batteries. The objective of the Batteries Directive is to protect the environment and human health from the potentially adverse effects of battery chemicals if they become exposed.
The Directive covers the maximum allowable quantities of certain chemical and metal content in batteries, proper disposal of battery waste and its collection, and the financial responsibilities for battery waste management.
Now with the climate agenda at the forefront of the bloc’s priorities, as well as rapid digitalisation and technological adoption, the Batteries Directive is more relevant than ever. Batteries are in high demand to fuel our electronic gadgets, and the mass feasibility of electric vehicles hinges on energy storage and battery performance.
With nations committed to net zero and approximately 30% of global GHG emissions arising from transportation, batteries are critical in facilitating the transition to clean energy. A key feature of this net-zero economy is certainly electric vehicles that tackle climate change’s transport problem.
While electric vehicles grow in popularity, they are creating higher demand for vehicle battery production. Considering the ambitious EU Green Deal, the circular economy action plan, Europe’s new industrial strategy, and the sustainable and smart mobility strategy, there is immense pressure for Europe to meet its green goals (which include cutting 90% of transport-related GHG emissions by 2050) – and batteries lie at the heart of it.
Since the Batteries Directive was proposed in 2006 and came into force in 2009 in Germany, the market for batteries has grown to include new makes and models for different purposes such as e-bikes and e-scooters. With external technological developments and changes in battery applicability, it makes sense to review the directive now for relevance.
In assessing the EU batteries directive, the Commission identified areas where the policy fell short in practice. Essentially, the key shortcomings were:
As a result of the assessment, 13 measures were proposed to tackle these challenges. These measures can be broadly summarised as the following:
The Commission proposed to convert the Directive into a Regulation, which has legal implications for enforcement. A regulation will impose the same obligations for all Member States of the EU and it will transcend national laws to ensure businesses are directly liable for compliance.
The Batteries Regulation applies to all types of batteries being placed on the EU market. The proposed regulation has some very specific requirements as to the collection and recycling of batteries, as well as their performance, durability, and emissions footprint.
Under an Extended Producer Responsibility, all operators placing batteries on the EU market excluding SMEs are required to ensure they meet higher collection targets.
Some of the targets are:
Businesses placing batteries on the EU market either directly or indirectly must demonstrate that the batteries used in production were sourced responsibly. This is a broad definition which captures social risks in addition to environmental concerns.
In other words, companies must prove that their battery value chain does not violate EU standards for labour and human rights. The due diligence process will be the company’s responsibility, to ensure sufficient and relevant data is collected and verified in order to assess, identify, and mitigate risks.
Like many other regulations, the proposed Batteries Regulation, once adopted, will be enforced by mandatory due diligence and reporting. The new regulation is scheduled to come into force in the first or second quarter of 2023.
There are three things companies need to do to prepare for compliance with the Batteries Regulation.