On the 27th of January 2026, PubAffairs Bruxelles organised an afternoon of discussion on the challenges and opportunities of the EU battery and raw materials industries. This event was also a timely opportunity to discuss how recent EU initiatives and policy frameworks can support the development of sustainable battery value chains and secure access to critical raw materials in Europe, with our distinguished speakers: Hildegard Bentele MEP (EPP/DE); Dominik Ruderer, Head of Division, Innovative Supply Chain and Process Industries, European Investment Bank (EIB); Frank Umbach, Head of Research, EUCERS/CASSIS, University of Bonn; Emily Ritchey, Policy Manager, Supply Chains, Transport & Environment; Michael Blakeney, Head of Government and Public Affairs, Cobalt Institute.
Mark Mistry, Director Public Policy and Sustainability, Nickel Institute gave an introductory speech.
The discussion was moderated by Kait Bolongaro, Managing Editor at MLex.
Kait Bolongaro opened the debate by welcoming the audience and introducing the main topic, namely batteries becoming crucial to Europe’s climate and industrial ambitions, while metals and raw materials remain a critical question to the EU value chain as whole. She gave further context by stating that the EU has launched a series of initiatives aimed to strengthen domestic battery production, secure access to raw materials and reduce external dependencies. The moderator explained that, at the same time, Europe faces growing global competition, higher production costs, regulatory complexity and increasing geopolitical uncertainty, all of which are shaping both investment decisions and policy choices. She then invited Mark Mistry from the Nickel Institute to give an introductory speech.
Mark Mistry premised that he was providing the perspective of the Nickel Institute, the global association of primary nickel producers. He then began his speech by pointing out some criticality assessments conducted by the Joint Research Centre of the European Union. He emphasised how important raw materials are – being them metals or minerals – for the different challenges our economy and society is faced with, with special regard to climate change, decarbonisation, defence and aerospace.
He continued by stating that the criticality assessments also identify supply risks associated with metals and minerals. He pointed out that there are rare earth elements that constitute a high concern, given that there is a high geopolitical confrontation for some raw materials, such as cobalt and nickel. He also stated that the latter are pivotal for all value chains: hence, when it comes to batteries, it is important to also take into consideration the industry which is producing raw materials.
He then moved on by to indicateing a chart, showing the different battery chemical composition. He clarified that there is not one single type of battery, and remarked that there is no battery technology available without hazardous substances. He also expressed the importance for this to be addressed later on in the discussion.
Subsequently, the speaker emphasised that, since 2019, there is a valuable momentum in Europe to establish a full electric vehicle (EV) battery value chain. He observed the commitment shown by EU member states and the European Commission with the Battery Booster initiative, which involves significant investors in the battery industry. He also noted, however, that most of the investments are foreseen for cell production, illustrating that the focus is sometimes concentrated on parts of the EU value chain and not its entirety.
He further discussed the EU Battery Regulation, noting that it is often described as a blueprint for future legislation. On the same note, he explained that this piece of legislation covers the entire lifecycle of batteries from mining to the use phase to recycling, while encompassing different dimensions such as sustainability, labelling and end-of-life management. He also stated that, while this is a valuable approach, it does not solve all the challenges the industry is facing.
He then showed a chart with the different pieces of legislation that the raw materials industry has to follow, and stated that chemicals management is a central issue within the current legislative framework. He reiterated that raw materials used for batteries have hazard properties and need to be dealt with under the chemical management legislation. Furthermore, he pointed out that there are sustainability requirements that are growing in importance, as well. He described this framework as a “legislative tsunami” that has to be followed and argued that the raw materials industry is to be effectively supported, a pivotal question being how to enable the sector to navigate and manage the challenges posed by excessive regulation.
Mark Mistry then elaborated on the evolution of nickel’s mine production in the last ten years. He pointed out that more than 60% of all mined nickel currently comes from Indonesia. He warned that Europe is losing its production capacity, in contrast with a growing global industry. He argued that it is fundamental to acknowledge that this is a globally competing industry and, as such, decisions cannot be made by taking into account only the old continent. In conclusion to his speech, Mark Mistry indicated some questions on screen that he would have liked to see being answered during the debate.
Kait Bolongaro thanked Mark Mistry, and moved on to introduce the panel participants and asked them their perspective on how realistic the development of a fully integrated European battery value chain is under the current European legislative and policy framework.
Emily Ritchey started off by pointing out that, although there is valuable potential in the European value chain and there are already effective policy measures in place, a lot more still need to be addressed. She then stated that there is potential to create a 900 GWh cell by 2030 and, to a lesser extent, to finalise other battery types such as cathode active material (CAM) and precursor cathode active material (pCAM). She continued by stating that 82% of EU’s demand in lithium refining could be met within Europe. She warned, however, that there is a need for the right policy framework as several projects are at risk across the value chain.
She described the Battery Booster initiative as a great first step with regard to funding for in-house manufacturing, but said that much more is needed. She expressed hope for the competitiveness fund to foster the production of battery cells in Europe. She then went on to elaborate on the Industrial Accelerator Act, notably expected at the end of February 2026, as an opportunity to create an EU framework that focuses on a component-based approach so that a valuable part of the value chain can be onshored.
Michael Blakeney answered by stating that Europe is in the position to be very competitive in battery manufacturing, electric vehicles and the supply chains on which they depend. He pointed out that batteries are often related to electric vehicles only, while the economic security part of the debate is often disregarded. In this connection, he argued, that these value chains are not only valuable for the economy, but are “must haves”.
Subsequently, he wondered whether Europe would be able to both attract a large amount of investments and continue to be a manufacturing powerhouse. He also stated that these processes rely on both investors’ confidence and competitiveness’ perspective. He emphasised the importance of these questions as Europe has competitive global companies with no obligation to invest in Europe. It is therefore important, he clarified, that the private sector is convinced that the European Union remains an attractive investment bloc. He also argued that Europe is not fully aware of the extent to which its own destiny is at stake. He continued by stating that too often ambitions are not followed by actions.
He gave the example of the RESourceEU Action Plan, which addresses several critical questions. At the same time, he pointed out that setting an occupational exposure limit (OEL) for cobalt is a critical issue, as values that are too low would have a negative impact on Europe’s cobalt industry. This would compromise Europe’s ability to remain competitive in green value chains, to achieve a circular economy and to secure strategic autonomy, while neither adequately protecting workers nor avoiding an additional €20 billion cost for the industry. By contrast, he highlighted that the RESourceEU initiative supports the entire critical minerals industry with €6 billion.
He argued that it is positive that RESourceEU exists, but argued that it is effectively swimming against the tide, as the bulk of current legislation appears to push back against industry.
Frank Umbach began his reply by pointing out that experts have long argued that a strategic stance on these issues should have been adopted much earlier. He went on to note that he lived in Asia, including Japan, in the mid-1990s, where he observed that the Japanese approach to raw materials has always been very different from Europe’s. He then explained that, although there is also a separation between private industry and the state, cooperation between the two has traditionally been much closer, which is why the Japanese model is now attracting increased attention.
He pointed out that, as early as 2010, China had already used its monopoly over rare earth production to exert pressure on Japan. He went on to explain that Japan subsequently asked Europe and the United States to supply rare earths that it could no longer obtain from China, to which China responded by halting rare earth supplies to Europe and the US, as well.
He explained that this led to a sharp increase in rare earth prices, which in turn prompted a German initiative in 2012, namely the creation of a collective buyers’ cartel (the “Raw Material Alliance”), as mid-sized companies were too small to compete individually with large state-owned Chinese firms. However, when prices fell again, the German industry abandoned the initiative in 2015, despite warnings that future demand would grow rapidly due to the expansion of renewable energy technologies and defence-related needs.
He remarked that the classic Western economic model, which is often driven by short-term profit considerations, has failed to adopt a long-term global competitiveness and strategic perspective, causing Europe to lose a decade in building up these critical value chains. He further noted that Germany only fully recognised the full scale of the problem in 2017, when the then Minister for Economic Affairs launched an initiative on batteries and addressed the associated raw material requirements. This triggered a broader discussion in Germany, which reached Brussels a year later.
To illustrate the urgency, he pointed out that the time between planning and opening a mine averages, at an international level, around seven years, while it takes between ten and fifteen years in OECD countries. He eventually emphasised that Europe’s dependence on China is not limited to the production of rare earths and raw materials, but is even greater in processing.
The moderator then asked Emily Ritchey what risks she saw in Europe’s current approach to batteries and raw materials, with special regard to sustainability and public trust.
Emily Ritchey explained that, in her view, a key risk in the current policy approach is that Europe is changing course by weakening or failing to fully implement existing rules. She cited the EU Battery Regulation as an example, noting that it includes specific due diligence requirements for essential battery minerals. In this connection, she pointed out that new provisions have been delayed and are now set to be discussed in the European Parliament, with the possibility that they may be further weakened. She then argued that this is particularly worrying because the rules were beginning to work as car manufacturers were taking greater action in response to regulatory measures, and this was having a positive impact across the supply chain.
She also warned that frequent changes in direction send the wrong signal to investors and companies. Referring again to the Battery Regulation, she highlighted that, while it contains strong commitments on battery carbon footprints, these provisions have been delayed by two years. She also stressed that this represents a missed opportunity, not only to reward greener batteries and cleaner, more responsible processes throughout the supply chain, but also to use carbon footprint rules to incentivise production in Europe, where the electricity grid is comparatively cleaner than in many other regions of the world.
The moderator then asked Michael Blakeney how Europe’s regulatory and policy environment for critical raw materials compares with other major markets, such as the United States and China, and what implications this has for global supply chains.
Michael Blakeney responded by drawing on the experience of the Cobalt Institute as the global trade association for the cobalt industry, which is in frequent contact with US authorities and other administrations around the world, and argued that there is a difference between the approach of the United States and that of the European Union.
He explained that, in his experience, companies operating in the critical raw materials sector in the United States are generally met with financial support and deregulation, whereas in Europe there is comparatively limited funding combined with a high level of regulation. He clarified that he was not advocating for Europe to adopt the US model, particularly in the current context, nor suggesting that either approach is inherently right or wrong, but rather emphasising that the incentive structure in Europe is fundamentally different.
He cited the legislation currently under discussion at EU level on recycling requirements for magnets as an example, noting that, while the objectives are sound in principle, even the most ambitious legislative targets require a sufficiently developed industrial base to ensure effective implementation in practice.
He explained that, from the perspective of the financial community, investment decisions are guided by relatively straightforward criteria, with capital flowing to locations that offer the highest expected internal rate of return. He argued that Europe must therefore ensure that it provides the most attractive conditions for generating returns in order to position itself as a leading destination for investment.
He further stated that regulation and competitiveness are not inherently contradictory and can be mutually reinforcing when regulatory frameworks are well designed and effectively implemented. In this context, he emphasised that Europe can pursue a race to the top by aligning high standards with competitive investment conditions, thereby strengthening its position in global markets rather than undermining it.
Kait Bolongaro then asked Frank Umbach for his perspective on the race for resources and the role of the United States. She pointed put in particular the question of a changing geopolitical context, including the US industrial policy and the recent US stances on Greenland, which are also reshaping Europe’s approach to critical raw materials.
Frank Umbach responded that the geopolitical context is becoming increasingly challenging, while emphasising that China represents the most important strategic challenge. He noted that Beijing recently revised its export permission procedures for critical raw materials, establishing three major preconditions for exports to Europe and the United States. Firstly, it requires that European companies transfer sensitive business data to Chinese authorities. Second, companies may not forward Chinese raw materials to the European or US arms industries, a process which undermines defence capabilities. Third, there must be no stockpiling of critical raw materials, a significant new restriction in the speaker’s opinion, also given that stockpiling has been considered as a policy tool in Europe and has already been implemented in the United States.
He continued by stating that the German Ministry of Economy recently inquired German companies on what China was requesting and what they were willing to provide in terms of sensitive data. However, the private sector is notably reluctant to disclose this information, while the European Union as a whole still does not have a clear understanding of the current dynamics. He stressed that this lack of transparency is highly problematic, as effective policy responses require a comprehensive and accurate picture of the circumstances.
Regarding the United States, Frank Umbach explained that there is a significant difference between the first and second Trump administrations. During the first Trump administration, raw materials was one of the few areas of strong EU–US cooperation, exemplified by the creation of a trilateral raw materials alliance between the US, the EU and Japan around 2012, later expanded to include Australia and Canada. However, in 2015, the US began to address its own raw material dependencies, including on China, with policies increasingly framed as matters of national security. This shift accelerated investment procedures, shortened the timelines for opening mining and processing facilities, and saw the Pentagon directly investing in mining and processing capacities.
The speaker also emphasised that, in recent years, the US has been active not only in Greenland, but also across Africa and Asia, competing with Europe in all regions where critical raw materials are sourced. This underscores that Europe faces not only the challenge of reducing dependency on China, but also of competing with a faster, more strategically mobilised US. He then questioned what the EU can could do to ensure a stable supply of imports in the years ahead, highlighting that excessive bureaucracy and slow decision-making – both in Brussels and at member state level – undermine the continent’s competitiveness.
He further explained that the strategic competition with the US extends far beyond Greenland, which is unlikely to play a major role in the sector for another ten to fifteen years. He cited the example of copper, noting that prices are rising sharply due to an increasing supply deficit. He referenced an international mining manager projecting that global copper demand over the next twenty to thirty years will exceed total historical demand, highlighting the critical importance of creating an attractive investment climate.
Echoing Michael Blakeney, Franck Umbach concluded that Europe does not yet fully grasp the scale of the challenges it faces in securing critical raw materials and ensuring strategic autonomy.
The moderator then gave the floor to Dominik Ruderer and asked how investors currently assess Europe’s battery and critical raw materials projects, and which factors are most influential in investment decisions today.
Dominik Ruderer began by noting that he agreed with many points raised during the discussion. However, while one may easily conclude that Europe may be too bureaucratic and slow, he emphasized a more positive perspective, highlighting that the Critical Raw Materials Act has now been in place for twenty months and has already had a measurable impact. While acknowledging that change could always be faster, he emphasised that significant progress has occurred, particularly within institutions such as the European Investment Bank (EIB), where substantial institutional change has taken place.
He explained that the EIB introduced its first critical raw materials strategy last year, accompanied by a detailed plan to increase its impact. The EIB had, in the previous year alone, financed seven critical raw material projects along the entire supply chain, committing €1.2 billion. Among these projects, lithium extraction in Germany, bauxite and aluminium processing in Greece and aluminium processing in Austria are the activities which received funding.
Regarding the battery supply chain, he noted that EIB CRM investments predate its critical raw materials strategy. Over the past five years the European Investment Bank has invested more than €3 billion in battery-related projects spanning large companies, start-ups, manufacturing, battery materials and research and development. While acknowledging other ongoing challenges, he also expressed optimism that the EIB will continue to have a significant impact, and that the Critical Raw Materials Act has institutional significance.
On the battery sector specifically, Mr Ruderer noted that the EIB considers it strategically important for both the automotive sector and electricity, but also other sectors such as security and defence. He emphasised the need to maintain public support for the sector, which remains nascent in Europe, and is technologically and commercially dominated by Asian companies. He cautioned that European battery growth has been lower than expected, global oversupply exists and major battery cell manufacturers reported losses in 2025, as investment requirements are high and innovation cycles are short.
Turning to the question of a European supply chain, Mr Ruderer argued that only a fully European supply chain can reduce dependency on Asian, particularly Chinese, players. Partial or fragmented approaches would not address strategic vulnerabilities, he added.
From an investor perspective, the speaker explained that the EIB seeks projects that are commercially viable and able to sustain themselves independently. While several projects may meet policy objectives, those without a convincing business case are unappealing, as the EIB ultimately functions as a bank seeking repayment.
He also emphasised two key criteria for investment: first, credible industrial players and private sector initiatives, which he views as crucial for successful projects; and second, strong integration into the European supply chain. The EIB does not support the creation of parallel Chinese supply chains, noting that Chinese players are currently attempting to establish vertically integrated supply chains covering raw material extraction, chemicals, manufacturing and vehicle production, he concluded.
The moderator then turned to Hildegard Bentele MEP and asked how EU policymakers are balancing objectives such as competitiveness, environmental protection, social standards and mining and refining, and where she sees the main tensions emerging.
Hildegard Bentele MEP acknowledged that some policies are being reconsidered and adjusted. She emphasised that, in terms of competitiveness, standards are not being lowered. Rather, procedures are being streamlined, she stated, and noted a stronger focus on early stakeholder involvement that has been instrumental in advancing projects.
Regarding the Critical Raw Materials Act, MEP Bentele highlighted that the focus extends beyond extraction to include refining and recycling. She remarked that, with the upcoming Omnibus proposals and the associated reduction of red tape, there is greater attention to the needs of the mining industry. She also observed an increased willingness within the Council and among policymakers to discuss these needs. Furthermore, issues related to mining that were previously raised in the context of the Critical Raw Materials Act, such as exceptions and control over waste streams, which were not feasible at the time and are now being addressed.
The speaker also noted a growing public awareness and sense of urgency to accelerate progress. She drew a parallel with the defence sector, where there is now greater openness to state intervention. MEP Bentele concluded by acknowledging that cost remains an important issue, but emphasised that awareness is increasing, along with recognition that achieving these objectives entails a price, and that policymakers are increasingly responsive to this reality.
The moderator then asked the panel which key indicators should be monitored to assess whether Europe’s battery and critical raw materials strategy is on track.
Michael Blakeney responded that, in simple terms, the decisive indicator is investment. He continued by elaborating that, according to an assessment by Benchmark Mineral Intelligence of the objectives set out in the Critical Raw Materials Act, the European industry currently operates at only around half of the required refining capacity and approximately one third of the necessary recycling capacity. He further noted that the expected growth in the sector between now and 2050 is approximately 350%. This implies that Europe would need to achieve growth of at least 350% merely to maintain its current relative position and that meeting strategic objectives would require significantly higher growth rates.
Referring to the EU Battery Regulation, Mr Blakeney highlighted the target of achieving 95% recovery of cobalt in electric vehicle batteries by 2032. If this target was applied in 2050, it would necessitate a 1,300% increase in cobalt recycling capacity in Europe. He added that achieving these objectives will require substantial investment at speed.
Mr Blakeney then observed that these projections do not yet account for demand from the defence sector, where significant commitments have been made in recent years. He noted that cobalt is classified as a NATO critical mineral, and emphasised that its strategic importance is often underestimated. Using the example of the F-35 fighter aircraft, he explained that cobalt is essential for stealth capabilities, engines, magnets and electronics. Without it, he specified, the aircraft would not be functional. He also stressed that similar dependencies exist for rare earth elements, nickel and other critical materials, warning that the loss of access to any one of these inputs can halt entire production chains, many of which remain highly vulnerable. Mr Blakeney further argued that, while stockpiling can be useful, it is ineffective without sufficient refining capacity, as raw materials alone are not directly usable. Moreover, stockpiling is not a sustainable long-term solution.
In his concluding remarks, he noted that several European countries agreed last year to increase defence spending to 5% of GDP, with approximately 1.5% allocated to related infrastructure, such as road and bridge upgrades. He expressed the belief that there is a growing recognition that the critical raw materials sector is fundamental to defence capabilities, and argued that increased NATO spending could also support investments in it. Such investments, he added, would simultaneously strengthen the green economy. He concluded by emphasising that the development of a robust and strategic cobalt industry requires scale, which can only be achieved through domains such as electric vehicle manufacturing as the defence industry alone cannot generate sufficient demand to sustain the necessary refining capacity.
Emily Ritchey reiterated that the coming years will be decisive in translating strategies into concrete action, particularly in European battery production, where significant gaps currently exist between projected and actual output. She emphasised that this challenge spans the entire value chain, including midstream activities such as processing, as well as recycling, where she saw considerable untapped potential. With regard to recycling, she noted that the European Commission is considering measures to restrict the export of black mass, arguing that such action is necessary to ensure sufficient feedstock for the development of a European recycling industry.
Frank Umbach observed that reactions to Europe’s plans for battery gigafactories have been mixed. He recalled a statement by a CEO recently reported in the press, suggesting that Europe should abandon battery development altogether and rely on Asian imports. According to the speaker, this statement reflected the fact that significant segments of European industry have not yet adapted to the strategic realities of the current era. He stressed that batteries are not only critical to the civilian electric vehicle market, but also increasingly essential for the defence sector.
He also argued that a fundamental shift in strategic thinking is required, one that has yet to occur across large parts of society. Beyond challenges related to the investment climate, he highlighted intensifying competition with China and the erosion of human capital and technical expertise. He noted that Germany retained mining stakes until the 1990s, which were subsequently relinquished in favour of reliance on the global division of labour. As early as 2005, this approach was recognised as a strategic failure by political and economic elites, when German mid-sized companies struggled to compete with Chinese firms. The Federation of the German Industry recognized in 2005 that a return to a status quoa ante (re-buying international mines or larger sharers of those mines) was no longer possible.
By drawing a parallel with the German nuclear industry, he further highlighted that, once an industrial capability is abandoned, it is extremely difficult to rebuild. Even where financial resources can be mobilised, the loss of specialised human expertise presents a major obstacle. He illustrated this with the example of a lithium mining project in a German state that had abandoned its mining sector decades earlier. He then stressed that this is not a problem that can be resolved quickly, and that solutions must begin at the level of higher education, through the re-establishment of mining programmes and the training of specialists.
He concluded that, in addition to investment considerations, a range of structural and capacity-related challenges must be addressed, many of which continue to be underestimated or overlooked.
Hildegard Bentele MEP expressed agreement with Frank Umbach’s assessment, while emphasising that there are nevertheless grounds for optimism. Returning to the question of whether Europe is on track, she argued that progress must be assessed against the objectives set out in the Critical Raw Materials Act (CRMA). In this connection, she acknowledged that the recycling targets are not fully realistic, explaining that this question emerged in the trilogues at a late stage as a compromise whose rationale was not clearly understood.
She noted, however, that the target of achieving 10% domestic sourcing is within reach. Drawing on her experience as a member of the CRMA Board, she observed that numerous projects continue to be submitted, including in Eastern Germany, where industrial traditions, technical skills and companies active in sectors such as oil and gas have been preserved. She also stated that Germany still retains pockets of relevant expertise, but cautioned that this expertise will be lost if decisive action is not taken promptly.
MEP Bentele maintained an overall optimistic outlook, stressing that, while some critical raw materials will inevitably need to be imported, Europe is actively developing partnerships and free trade agreements to support supply security. In this regard, she highlighted that several countries facing similar challenges – particularly those seeking to reduce dependence on China while also experiencing pressure from the United States – are approaching Europe as potential partners. She cited Canada and Australia as examples, noting the opportunity for complementary relationships, given their strengths in other stages of the value chain, such as refining capacity and access to black mass.
She further explained that, while the European Critical Raw Materials Board is currently assessing projects against the 2030 targets, internal discussions are underway to consider 2035 as an additional benchmark in order to provide more projects with a realistic opportunity to succeed given the long-term nature of such investments.
Regarding the battery industry, MEP Bentele urged policymakers and industry alike to take decisive action. She observed that, on the regulatory side, frameworks covering all segments of the value chain were largely established during the previous legislative term, yet industrial uptake has lagged behind. She emphasised the strategic importance of a European battery sector not only for the automotive industry, but also for defence applications and energy storage, and argued that a strong and immediate signal is required, particularly as the sector is currently in decline. At the same time, she noted that the automotive industry must decide whether it intends to continue relying on Chinese battery suppliers or to support the development of a European battery industry.
The speaker also raised concerns that raw materials mined in Europe may not remain within the European value chain in the absence of sufficient domestic demand. She suggested that local content requirements could be considered to address this risk, arguing that, if substantial effort is invested in developing European sourcing and value chains, some mechanisms to ensure that a meaningful share of production remains in Europe would be needed. Alternatively, she proposed targeting markets that place a premium on sustainably sourced minerals, rather than competing solely on price with Chinese suppliers.
She concluded by stressing that these are strategic choices that require timely and decisive political action.
According to Dominik Ruderer, the overarching objective is to foster and scale commercially viable investments, beyond those relying primarily on public funding, into globally competitive projects. Assessing the European Union’s progress towards this goal, he noted that lithium-related projects financed by the European Investment Bank (EIB) over the past 24 months are expected to cover approximately 20% of Europe’s lithium demand. He highlighted that, when looking back over the past two years, several meaningful success stories have emerged, with the EIB investing in highly competitive extraction and processing projects, as well as in gigafactories located in Europe. While acknowledging that there remains room for improvement, he emphasised that there are also clear grounds for optimism.
Frank Umbach drew attention to a structural challenge, namely that Europe has largely lost its historical technological advantage vis-à-vis China. He argued that the 2030 targets of the EU and German hydrogen strategies of 2020 are unrealistic as a study of 2025 hasve highlighted (see bibliography: Umbach/EWI study), and noted that Europe is also lagging behind in the development of other strategic technologies, such as hydrogen. He pointed out that China currently controls around 40% of the global electrolyser capacity and 60% of the global electrolyser market.
Moreover, he stressed that Chinese technology is not lagging behind. On top of this, through the deliberate creation of overcapacity, Chinese producers are able to offer significantly cheaper products. This has led several European green technology companies to source from or relocate activities to China, he stated. Nevertheless, Frank Umbach noted that, whereas global competition in green technologies previously involved Europe, China and the United States, the US has largely withdrawn from this space, opening a window of opportunity for Europe.
Hildegard Bentele MEP responded that the current economic situation does not reflect fair competition, as Europe is facing heavily subsidised products in a distorted global market. She expressed scepticism about the sufficiency of existing policy instruments, and suggested that market intervention may be required to create a level-playing field. She noted that countries such as Australia are already discussing measures such as price floors, and argued that Europe should consider similar tools. She emphasised that such interventions would be temporary, but potentially necessary in cases where WTO mechanisms are ineffective or where export restrictions are imposed.
Michael Blakeney agreed with the preceding assessments and stressed that politics ultimately requires making decisions. He linked this observation to the challenges surrounding critical raw materials, the battery industry and their related dependencies, questioning when Europe will be prepared to act decisively. While acknowledging the strong rhetoric surrounding critical raw materials, he argued that concrete decision-making remains hesitant. He maintained that a clear choice must be made, along with a willingness to accept the political consequences. He further observed that the current investment climate for the cobalt industry in Europe is unwelcoming, rendering investments economically unattractive and hindering sectoral development. He suggested that market interventions and confidence-building mechanisms may therefore be necessary.
Hildegard Bentele MEP concurred with Mr Blakeney and highlighted the central role of budgetary decisions. She observed that national governments have begun establishing raw materials funds, while the European Commission has indicated that approximately €3 billion will be mobilised through the RESourceEU initiative across various funding instruments. She argued that the question of whether Europe genuinely supports its industries will ultimately be reflected in budgetary allocations.
Emily Ritchey echoed the importance of strengthening local value creation in Europe and stressed the need for highly targeted measures to support the battery industry. She identified the forthcoming Industrial Accelerator Act as a crucial opportunity, advocating for a component-based approach that ensures coverage of the full value chain or, at a minimum, extends further upstream. In addition, she argued that the Industrial Accelerator Act could be used to introduce conditions on foreign investment, such as requirements to employ local workforces and share intellectual property, thereby accelerating learning curves and capability development within Europe.
Kate Bolongaro then turned to the audience for questions. A member of the audience asked whether we should reduce the demand of critical raw materials to reduce the dependencies of Europe on other countries for the supply of these materials, by phasing it out in certain products and reserving it for strategic industries such as defence.
Michael Blakeney clarified that he was speaking from the perspective of the cobalt industry, and explained that cobalt has historically been an expensive material to incorporate into final products. As a result, there has long been a strong economic incentive to engineer cobalt out of applications wherever possible. He noted that, while this has been successful in some cases, cobalt often remains indispensable because it is extremely difficult to substitute without compromising performance.
He illustrated this point with the example of superalloys that enable modern aviation engines to operate reliably for decades under extreme conditions in which alternative materials would inevitably fail or melt. He emphasised that such technological achievements are made possible by the use of advanced materials, many of which fall under the category of critical raw materials.
Frank Umbach noted that the question raised a number of important issues, but emphasised that there is no single, comprehensive solution. He explained that substantial research is currently underway to reduce the demand for critical raw materials in certain technologies, with mixed results. In some cases, such as magnet technologies, specific critical raw materials can be substituted, albeit often at the expense of efficiency. He stressed that continued research remains worthwhile, as it can yield meaningful outcomes in selected applications.
He further observed that recycling, while essential, is subject to inherent limitations and cannot, on its own, resolve all supply challenges. He concluded that policymakers and industry must therefore maintain realistic expectations regarding the scope of available alternatives, particularly in the medium term.
The speaker also highlighted a related challenge concerning investment in the extraction of critical raw materials and future market prospects. He explained that demand trajectories are closely tied to technological developments, citing lithium as an example. While lithium is currently a key input for many battery technologies, next-generation batteries may rely on different combinations of materials, thereby increasing uncertainty around the long-term viability of lithium mining projects, he stated. He also pointed out that this creates a structural dilemma, as insufficient investment in mining today risks exacerbating existing and future supply deficits, while technological uncertainty complicates investment decisions.
A member of the audience asked whether strategic sectors, such as defence and domestic energy, should face fewer local sourcing requirements, while non-strategic sectors could be leveraged to build domestic demand.
Hildegard Bentele MEP responded that this rationale underpins the designation of “strategic projects” under the Critical Raw Materials Act, which also includes the possibility for EU member states to invoke overriding public interest in order to accelerate project approval. She cautioned, however, that public administration remains generally slow and understaffed, and that issues of local acceptance cannot simply be overridden.
She also acknowledged that there is considerable room for improvement in terms of streamlining procedures and setting priorities, but observed a clear learning curve: each successive project tends to be better prepared, benefits from stronger political backing and incorporates earlier stakeholder engagement. She further noted that public awareness of the importance of energy infrastructure, energy independence, defence capabilities and digital sovereignty has increased. According to MEP Bentele, this heightened awareness has made communities more receptive to industrial activities, such as refining and processing, that had previously been phased out or faced strong resistance.
The Q&A session also covered the following issues: the digital product passport for batteries and their implementation challenges; the case of when due diligence rules were introduced before the relevant guidelines and competent authorities were in place, which led to delays in their implementation; the replacement of Russian fossil imports with renewable energy; the question of cybersecurity of energy infrastructures; China’s objective to become increasingly self-reliant; the advancement of European integration; the possible evolutions of cell manufacturing.
Do you wish to know more about the issues discussed in this debate? Then check out the selected sources provided below!
Critical Raw Materials Act, European Commission
RESourceEU Action Plan, European Commission
Commission takes action for clean and competitive automotive sector, European Commission
Industrial Accelerator Act, Legislative Train Schedule, European Parliament
The 7Ds Extended. A Roadmap for a Sustainable Future, Wilfried Martens Centre for European Studies
