The world's and Europe's production capacity for batteries will increase sharply in the next couple of decades. Whether it will be quadrupled or twentyfold by 2030 is impossible to determine with any degree of certainty.
Innovation Norway takes an aggressive approach and calls for a major Norwegian investment in the production of battery cells. They point to the fact that many countries and car manufacturers have great ambitions to increase sales of electric cars in the years and decades to come. The USA recently set a goal that half of all new registrations should be electric cars by 2030. In the EU, all new cars should be electric by 2035, while the Norwegian goal is that all new cars should be electric cars by 2025 at the latest.
In a press release, Innovation Norway writes that most countries in the world have put in place support schemes for electric cars, but even without such schemes, the proportion of electric cars will probably rise sharply. This will mean a rapid growth in the demand for batteries.
According to Innovation Norway, the world's and Europe's production capacity for batteries will increase sharply over the next couple of decades. Whether it will quadruple or twentyfold by 2030 is impossible to determine with any particular degree of certainty. The consulting company McKinsey estimates that Europe will demand battery capacity of nine hundred gigawatt hours in 2030. This corresponds to 9 million cars if all the capacity is used for this. Last year, Europe produced around ten million passenger cars. The IPCEI has a lower estimate and suggests Europe will demand battery capacity of between 400 and 800 GWh in 2030.
How many factories are needed to produce this battery capacity, Innovation Norway asks, and answers as follows:
Let's say that the average battery size going forward will be 100 kWh. A factory, or giga factory as the battery factories are called, is now being built to be able to produce 30-50 GWh a year. Freyr has ambitions to produce 43 GWh annually at Mo by 2025. With a European demand of, for example, 750 GWh, there could be 20-40 factories in Europe by 2030.
McKinsey believes that Norway should be able to take 25 per cent of this market, and that in that case it would mean a value creation of NOK 40 billion and 20,000-30,000 man-years in the factories. In that case, it will be a significant proportion of industrial employment in Norway, which was 200,000 man-years in 2021.
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