European energy and climate policy and the role of innovation Case Energy Storage Bo Normark, Thematic Leader Smart Grids & Storage

The European engine for energy innovation and trusted ecosystem About InnoEnergy The European engine for energy innovation and trusted ecosystem Students Research Entrepreneurs Tomorrow’s leaders Innovative solutions New businesses Education Innovation Projects Business Creation Services

INSIGHT_E Reports Nov 2014 and Dec 2015

Increased penetration of variable energy production, growing trade of electricity and new demand pattern will increase the role of battery storage. Battery storage will become a game changer in the electricity system and could: Bring flexibility to the energy system, Be an enabling technology for the achievements of the EU 2020 and 2030 RES targets Become a service provider and improve the liquidity in the balancing market Stimulate increased self-consumption in households and thereby increase penetration of RES

Evaluate the potential benefits of storage Batteries alternative to build more grid

Evaluate the market development Automotive Power

Question from the Commission in February 2017: “What is needed to be done for making Europe a winner in batteries ?”. Societal & Individual Technology Human Capital Regulation Value Chain/Market/Biz Model Supply Chain Think City 2009 Platser: 2 Längd: 314 cm Max H ast:113 km/h - 100km/h: 16 s. Räckvidd: 161 km Effekt: 34kW (46hk) Utrustning: Ej AC, Ej servo, direkt elvärme, ingen aktiv säkerhet… VW e Golf 2014 Platser: 5 Längd:425 cm Max Hast: 140 km/h 100km/h: 10,4 s. Räckvidd:190 km Effekt: 85 kW (115hk) Utrustning: ACC, servo, värmepump, aktiv säkerhet, LED belysning….

Mapping the European position along the value chain

Evaluate the gap in production Source: Benchmark Minerals Intelligence

Innovation along the entire value chain Raw materials Active materials Modules/Pack Platforms/EV ESS, industry Cell Recycling B2B B2C

Creating an innovation eco-system around cell production Higher Education EU Action Plan Nordic Action Plan Swedish Action PLan Coordinated Political support Funding Regulation etc Gigafactory Human Capital Research Center of Excellence Technology Batt Chemistry Sales EV New Technology New Packs/BMS New Applications Sales Innovation Ecosystem (ESS) application / commersialization Grid Home Innovation flow (TRL 1 -> 10) Market exploitation

First large scale battery factory in Europe ? Challenge Lithium batteries are dominating the transportation sector and is becoming the main technology for energy. European supply of battery cells has to meet the need and be secured. Solution Europe’s first large-scale battery factory will produce competitive battery cells for electric cars, energy storage and other electrical powered products and applications. Value Proposition High-quality & price competitiveness through limited type of cells and large volumes Vertical integration Best in class sustainability “InnoEnergy is the gateway to the largest and most valuable innovation ecosystem in Europe,” says Peter Carlsson, CEO and co-founder of Northvolt. “The investment will support us in realizing our vision of creating Europe’s largest scale battery cell production facility. But – more than that – InnoEnergy’s vast network has the power to support us for years to come.” Strong synergies between battery cells for energy, automotive and other sectors. Northvolt aims at producing

Strong political support for “Battery Union” Next month will see another significant milestone as the Commission will present a major legislative proposal on boosting clean transport. That is where batteries come in. Their development has already radically disrupted the mobile market; you wouldn't have a smart phone today if it weren't for the development of lithium batteries. Now they are about to redefine our transport and energy markets.  Policy-makers cannot predict the future, but we can greatly influence it. We can create the best conditions for a battery value chain to develop in Europe.  On Wednesday, we were joined by high-level government officials from a dozen European Member States as well as major European manufacturers of cells and battery systems, OEMs, energy providers, research associations, financial institutions etc. We agreed to work together towards an EU Battery Alliance. This process will be inclusive. I am inviting all interested industrial players, research and innovation actors, Member States and financial institutions to join us. The result of our joint efforts will be presented in February with our new a strategic industry-led roadmap for an EU's Battery Alliance.

Conclusions Battery Industry will become crusial for the transformation of the Energy and Automotive Sectors Batteries crusial element in revival of European industry Critical success factors: Coordinated European actions Activities along the entire value chain from mining to recycling Establishment of large scale production Establishment of Innovation eco-system Adressing all dimensions in the diamond Strong political support via ”Battery Union”

Contact bo.normark@innoenergy.com +46 (0) 706 088 020