As electrification ramps up, so does the need for increased transparency and traceability across the complete battery supply chain.
Siemens has sponsored this post. Written by Puneet Sinha, Siemens Digital Industries Software.
Electrification is happening in industries around the world as manufacturers move away from non-renewable resources. A large portion of this strategy relies on the electrical storage potential of batteries. Electric vehicles (EVs) specifically have marked a significant shift for one of the most impactful industries in regard to carbon emissions: automotive and transportation. Rapid growth in battery EVs globally, concerns over ethical sourcing of critical minerals for batteries and a necessity to increase the use of recycled material for cell production are some of the key reasons driving a need for increased transparency and traceability across the complete battery supply chain.
Mounting government transparency regulations are also playing a pivotal role in creating traceability and transparency across the battery supply chain by requiring companies to deliver digital battery passports. EU regulators have mandated that by February 2027 any battery with more than 2 kWh capacity for industrial or EV applications must have a digital battery passport. These passports must contain information about material composition, sourcing location, carbon footprint, performance and lifecycle.
Digital battery passport efforts are gaining traction in other countries, as well. China, which accounted for 77% of global battery production in 2022 and 60% of all EVs sold in the world in 2023, has launched an initiative to develop a Chinese battery passport following EU regulations. Their aim is to facilitate trade with the EU by establishing similar data transparency requirements along the EV battery value chain in China, including carbon footprint, circularity and ESG. Similar regulations are being worked on in the U.S.
What the battery passport means to a growing industry
Battery passport requirements bring a new level of reporting to every facet of the battery value chain, from raw materials to finished products. Businesses will need to collect many different data types and do so in a transferable, verifiable and secure manner. This creates a challenge for battery manufacturers and end system integrators such as automakers to bring their products to market. While the end system integrators are the responsible party for providing the data that goes into a battery’s passport, much of the information comes from the broader value chain. Some of the simpler requirements might be easy to obtain from suppliers, such as the unique battery identifier, product information, country of origin, battery type and the battery model. But much more needs to be accessible via the battery passport identifier.
The battery manufacturer will need to provide information on the battery composition, recycled content percentages, the contents of critical raw materials and more. Meanwhile, data from the manufacturer’s value chain will be required to inform compliance certification and labeling, the total carbon footprint of the battery and information on responsible sourcing. In addition, battery performance over its lifecycle is another key data point for battery passports and will require the reporting of data collected through the battery management system. Reporting standardization will be critical in meeting the data requirements for battery passports as well as tracking the history of a battery as it is inspected, serviced or passed on to another party.
Making all of this happen efficiently and without risking IP will require a robust and secure digital platform and reliable partners.
Accelerating an industry shift with digitalization
While battery passports are a new and unique requirement for industry, the components making it possible are already part of the Siemens toolset and expertise. In general, there are three major challenge areas to integrating battery passport requirements: the technical realm, the business realm and global cooperation.
On the technical side, Siemens is uniquely positioned to support the battery supply chain to meet battery passport regulations with battery passport software, along with the digital framework that empowers companies to collect and report the needed data in an efficient way. Siemens is working with customers, partners and industry experts to create a cloud-based, secure battery passport offering. In addition, a key challenge for automakers, battery suppliers and the rest of the supply chain is to have efficient availability of data to feed into a battery passport.
With its digital solutions, Siemens is ideally suited to empower the industry. Siemens’ PLM solution offers the single source of truth for batteries as well as for factories and facilitating seamless supplier collaboration. The data needed for battery chemistry, material composition and design for battery passport can be easily extracted from the digital twin of the product and manufacturing process. With Siemens’ MES solution bringing seamless IT/OT integration, companies can easily account for the data from the production floor to the battery passport. In addition, Siemens delivers end-to-end product carbon footprint data collection from the shop floor as well as the complete supply chain.
With its digital twin solutions for batteries, Siemens is striving to deliver new digital services. For example, battery state of health assessment, prognostication of issues to schedule servicing, optimized battery recycling guidelines and second life assessment leverage data from battery passport and digital twin solutions.
Tools for the business processes associated with battery manufacturing are also needed for the battery passport system to function effectively. Businesses need to be able to conduct due diligence when working with suppliers, with reporting from the wider battery industry. Businesses need to be able to research the circularity practices, resource efficiency of different suppliers and even material recyclers to create a more sustainable business. And all the data being generated on the design and production side must be shared securely so that other parties can understand the characteristics of a battery through its battery passport.
The wide-reaching cooperation required by battery passport regulations puts pressure on creating strategic partnerships across the industry and complete value chain. Communicating the impacts of design choices, manufacturing operations and supplier selections is critical for accurate battery passports. To help customers with this evolution in transparency and communication, Siemens is working with leading industry consortiums such as Catena-X and the Global Battery Alliance.
Making a more sustainable battery business
The Siemens Battery Passport is a critical step in achieving transparency and sustainability for the battery value chain. It can radically transform the industry, ensuring ethical sourcing and sustainable practices. But that promise is not without challenges, including the need for strategic actions and collaborations among many diverse stakeholders. With government regulations, industry commitment and technological advancements playing a crucial role, the Siemens Battery Passport is set to redefine the future of the EV battery industry. And Siemens is a partner in making that a reality, with its expertise in technology solutions and understanding of the industry’s requirements.
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