A circular battery plan for Europe

The circularity potential of the European battery industry: a critical window closing by 2030

Circularity in the European battery industry is a strategic imperative – environmental, industrial, and economic alike. Europe, however, has only a narrow window, running to 2030, to realise this potential. Yet the diagnosis set out in this study shows that industrial reality still falls well short of it. Reversing the trend requires building capacity across the entire value chain, particularly its midstream links (active material production) – currently its weakest points.

Building on an assessment of the recycling sector’s current weaknesses and shortcomings, IMT proposes a set of 18 concrete measures, phased over time and structured around six pillars:

1. A clear classification (taxonomy) to distinguish between recycling activities, identify the segments critical to a genuine EU-based circular economy, and calibrate and target policy accordingly.
2. Integrating recycling costs into producer costs, with greater accountability enforced through harmonised accounting obligations under Extended Producer Responsibility (EPR).
3. Retaining feedstock (black mass) within the EU – a prerequisite for any domestic refining investment, since no hydrometallurgical project is bankable without visibility on feedstock access.
4. Creating structured demand or lead markets for midstream segments that gives recyclers stable offtake and closes the loop – including support for intermediary segments and closing the competitiveness gap with Asia.
5. Funding in the future EU budget (MFF), including production support (OPEX), underpinning all other pillars by de-risking areas where private capital alone falls short.
6. An harmonised battery reparability index, to be integrated into the future European Circular Economy Act.

The goal: to lay concrete groundwork for a more integrated European industrial and circularity policy – an essential condition for steering and sustaining circularity trajectories across the continent.