In this article Jim Denness looks at the pressing need for the UK to develop its own chemical supply chains to support battery technology in its automotive sector, and considerations for your associated intellectual property strategy and maximising opportunities.
For most of my career my area of “industrial” chemistry has felt a little overshadowed by the exciting developments in biotech and pharma. Not anymore. The great challenge of our times, climate change, is putting industrial chemistry at the heart of government policy and social concerns and forcing innovation and development at breakneck speed in areas such as carbon capture, the hydrogen economy, polymer sustainability, and energy generation and supply. It has become apparent that batteries will be a key technology in building a more sustainable society.
The move to electric vehicles is irreversible and happening on a rapid timescale underpinned by legislation. Here in the UK the sale of petrol and diesel cars will be banned from 2030. Brexit provides an additional impetus, because under rules of origin a specified proportion, typically around 50%, of the value of a car will need to be created in the UK for that car to be considered UK manufactured, and to benefit from trade deals between the UK and other countries. With the battery accounting for around 50% of the cost of manufacturing an EV, and the chemical supply chain accounting for the majority of the cost of the battery, there is a pressing need to develop a UK-based chemical supply chain to support the UK automotive sector.
It has been fascinating to watch the efforts on both sides of the Atlantic to build a new EV battery supply chain almost from scratch. EV battery packs are costly and hazardous to transport, so there is an urgent need to produce the batteries close to where the cars will be built. “Gigafactory” – essentially a massive battery factory - has become a buzzword, the stand-out example being the Tesla factories in the US. In the UK, we have proposals for new gigafactories in locations including Northumberland and the West Midlands. In a recent development, BP has announced a £50 million investment in a global battery research centre in the UK.
Alongside that effort to develop the supply chain to support existing lithium ion battery technology, innovation continues at speed on all aspects of battery technology. Those include the fundamental chemistry, through cell and pack design, charging technology, second life applications and developing much-needed methods of recycling the battery materials at end-of-life.
In such a fast-developing area, innovators who take full advantage of the patent system to protect their inventions can secure a long-term advantage over their competitors. A patent gives its owner a monopoly over the invention it covers for twenty years. This creates opportunities and risks for both incumbents and new entrants to a market. A joint study carried out in 2020 by the European Patent Office and the International Energy Agency showed that between 2005 and 2018 patenting activity in electricity storage grew 4 times faster than the average across all technology and that batteries accounted for nearly 90% of that activity, with the main focus being lithium ion batteries for EV and consumer electronics. Asia has a clear lead, being home to nine of the top 10 global applicants for patents relating to batteries.
In order to avoid problems and maximize the value of inventions and IP, companies should consider some key points while developing a strategy:
The risks and rewards in the competition to develop a domestic battery supply chain are huge on both sides of the Atlantic and it is important for us all that we develop and foster the new technologies to combat climate change. I am looking forward to seeing how the battery sector develops over the next few years and continuing to help my clients to make effective use of the patent system in order to achieve their commercial objectives.
We assist UK and European technology companies who operate internationally in protecting their battery innovations and brands worldwide, and global battery technology businesses and manufacturers requiring intellectual property protection in Europe. Our team also works with a growing list of SMEs developing groundbreaking technology in this sector.