WEMO24-Compiled Report-Interactive compressed (002) 4154-7882-8116 v.1 - Flipbook - Page 40
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Outlook
166 IRA: Inflation Reduction Act passed in 2022
167 https://www.canada.ca/en/services/environment/weather/climatechange/climate-plan/cleanelectricity-regulation.html
168 https://www.enecho.meti.go.jp/en/category/special/article/detail_178.html
169 NZIA: Net Zero Industry Act voted in 2024
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Also, the regulations that have been adopted on the circular
economy will oblige battery manufacturers to use recycled
metals, thereby reducing the need to extract these metals (see
chapter on the circular economy).
Rare earths, graphite and rare metals:
Western countries realized that to implement their energy
transition they were not only dependent on Chinese clean tech
equipment but also on certain raw materials: (as rare metals
and rare earths) and graphite (for battery anodes)170.
Driven by a desire for independence (or at least less dependence)
on these strategic materials, manufacturers have evolved their
technologies to use less of them. For example, by developing
battery cells without cobalt and with less manganese and nickel.
WEMO 2024
The EU Net Zero Industrial Act (NZIA) stipulates that by 2030,
40% of clean tech products must be supplied in Europe. In
this framework the European Commission has launched the
Holosolis project. The factory located in Sarreguemines in
France, is expected to produce 10 million solar panels annually—
enough for around one million households—and generate over
2000 jobs by 2028 with an investment of €850 million. However,
at least at the beginning, the silicon ingots will be imported
from China.
Unlike in the USA, where the IRA offers generous subsidies, the
EU’s Green Deal Industrial Plan provides little new finance, and
its implementation is much slower than IRA’s. For example, the
European Green Deal was launched in 2020, and in 2024, 60%
of the money has still not been spent while the IRA planned
spending envelope has been totally paid out two years after
it was voted.
170 https://chinaobservers.eu/de-risking-rare-earths-the-greenland-stalemate-and-the-criticalraw-materials-act/
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Regulations to promote domestic production
The USA166, Canada167, Japan168 and Europe169 have passed laws to
encourage domestic critical equipment production. This is very
positive for the region’s industrial development as these laws
create a large market for investors (domestic or non-domestic).
One drawback is that the higher labour costs and more stringent
regulations than in China, lead to higher prices. To combat this,
it is urgent that Western regions boost their R&D and innovation
incentives to create new and cheaper solutions and processes.
We have analysed above the benefits of the IRA.
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