EU classification of lithium as a hazardous substance would delay the energy transition and undermine Europe's position in the electric vehicle (EV) race, seven industry groups have warned in a letter to EU legislators.
In the letter seen by Argus, the groups — the European Battery Recycling Association, the European Geothermal Energy Council, Eurobat, Eurometaux, Euromines, the International Lithium Association and Recharge — express "deep concern" at a proposal from the European Chemicals Agency's (ECHA) risk assessment committee to classify three lithium compounds.
The European Commission is considering a proposal by the ECHA to classify lithium carbonate, chloride, and hydroxide as dangerous for human health. But industry members say the scientific evidence on which the proposal is based is weak. A final decision is expected at the end of 2022 or early 2023.
"Europe is at a critical period in its energy transition, needing to stimulate new investment into a full electric vehicle battery value chain," the letter states. "Its looming challenge is now to secure the battery metals that will be in very short supply over the next 15 years."
"An unjustified lithium salt classification will be a red flag that brings great uncertainty to companies looking to make long-term investments into European refining and recycling capacity, risking delays or different investment decisions toward competing markets."
The proposal does not ban lithium imports, but if approved it would add to processors' costs because of tighter rules on processing, packaging and storage. This, according to the groups, could "provide the industries located in countries not submitted to [registration, evaluation, authorisation and restriction of chemicals] regulation a competitive advantage for producing and using these lithium salts, due to less ambitious health and environment protection requirements, and open the door to new risk management measures with new requirements not faced in competing regions".
At the same time, the legislation would result in the stigmatisation of lithium — designated as a critical raw material — which would have a negative effect on acceptance of new projects in the EU, according to the letter.
"This move isn't justified by the science, and would perpetuate Europe's risky dependence on China for lithium refining. It would have a chilling effect in the EU's green energy transition, and it is vital that the UK government doesn't make the same mistake," Richard Taylor, founder of the UK's Green Lithium told Argus. "The opportunity for the UK is to act independently in this area to attract long-term investments into more favourable UK refining and recycling capacity."
Several European original equipment manufacturers and lithium battery supply chain companies and institutions have already voiced concern to the EU. Lithium producer Albemarle Corp said it might have to shut its Langelsheim plant in Germany if the metal is considered toxic.
And producer Vulcan Energy said the proposal is "based on incorrectly interpreted applications of the classification criteria, and did not take into full consideration more recent studies on this subject".
The EU expects there to be 30mn electric cars on the continent by 2030. To meet demand, an equal number of batteries will need to be produced, for which access to raw materials is becoming critical.
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