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A path to global leadership for K-batteries

Published: 07 Nov. 2024, 19:56

Since February, the European Union’s stringent new battery regulations have required companies to document the entire lifecycle of batteries — from manufacturing and use to disposal and recycling — aimed at ensuring sustainability. With the enforcement provisions set to take effect next August, the stakes are high for battery companies globally. For Korea’s battery industry, which relies heavily on raw materials from diverse sources, establishing a transparent supply chain within a limited timeframe poses a formidable challenge. Failure to comply may result in fines or even operational restrictions in the European market, making proactive action essential at both the industry and government levels.

First, it is crucial to fully understand and internalize the legal and technical requirements of these regulations. The government should work closely with industry stakeholders to provide clear information on compliance and encourage small- and medium-sized suppliers to prepare adequately. Additionally, a proactive outreach to EU regulatory bodies, such as the European Commission, could help ensure that the perspectives of Korean companies are considered when the enforcement provisions are finalized.

Second, companies must strengthen raw material traceability systems. Implementing advanced technologies such as Internet of Things (IoT) and blockchain can enhance transparency in the supply chain, enabling documentation at each stage of material procurement.

Finally, establishing robust battery recycling and retrieval systems will be essential. Given the EU’s increasing emphasis on accountability throughout the entire lifecycle of batteries, companies need to thoroughly manage post-use collection and recycling. Collaborating with local recycling companies in Europe or considering direct investments in recycling facilities within the region are potential paths forward.

Europe’s new battery regulations present both a challenge and an opportunity for Korean battery companies. Proactive compliance will enable them to secure a distinct competitive edge over Chinese companies, which are facing significant difficulties with environmental standards. By preparing for the evolving international regulatory landscape, the Korean battery industry has an invaluable chance to enhance the global standing of K-batteries.

Cho Dae-hee, a master’s course student at the KAIST Graduate School of Management of Technology.