The global battery market is experiencing unprecedented growth, with projections showing the sector will reach $400bn by 2030. Yet European entrepreneurs often feel locked out, watching Chinese giants like CATL dominate headlines with record-breaking IPOs while homegrown champions like Northvolt file for bankruptcy, exposing the harsh realities of competing against established Asian supply chains.
Still, Europe will never be entirely independent in green energy and will want to cooperate with Asia. Yet the continent has strong demand for on-shoring supply, including green power and critical manufacturing. There are also genuine competitive advantages available to European green battery startups: proximity to end users, a deep understanding of regulatory requirements, and the ability to move quickly on specialised applications.
The question isn’t whether you can build batteries cheaper than China — it’s whether you can build better solutions for specific European needs. My company, alterity, found a profitable niche in batteries to power forklifts, lifting platforms, and mobile robots that operate in industrial facilities. Other startups can find their niche, too. These are our tips for developing a scalable green battery business.
1. Target specialised niches rather than competing on scale
Identify high-value applications where innovation and environmental compliance matter more than unit cost. You could find them in the aerospace, defence, marine, offshore wind, and medical device industries. They all have a high demand for batteries, alongside stringent manufacturing and regulatory requirements that favour European manufacturers.
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Data centres represent another market where European companies may have an advantage. As hyperscale operators face increasing pressure to meet carbon neutrality commitments, they’re seeking suppliers who can demonstrate 15-20% CO2 reduction potential in manufacturing and other sustainability benefits.
2. Use EU regulatory requirements as differentiation tools
Turn compliance into a competitive moat by aligning with the Critical Raw Materials Act, EU Battery Regulation 2023/1542, and sustainability reporting rules that Asian mass producers may struggle to meet. Building these capabilities into your core operations from day one creates sustainable differentiation that becomes increasingly valuable as regulations tighten.
Develop expertise in lifecycle carbon footprint calculations, sustainable material sourcing documentation, and end-of-life recycling processes. What starts as compliance becomes a competitive advantage when multinational corporations need suppliers who can navigate European regulatory complexity while demonstrating quantifiable environmental impact.
3. Leverage EU circular economy principles as a competitive advantage
European customers increasingly evaluate suppliers based on total environmental impact, not upfront costs. This shift creates opportunities for manufacturers who can measure material recovery rates and lithium waste reduction through advanced recycling technologies and closed-loop systems. Companies that can achieve superior material recovery rates while quantifying environmental benefits will find themselves with sustainable competitive advantages as raw material costs continue rising globally.
4. Pursue industrial partnerships and European innovation ecosystems
Europe offers world-class industrial clusters that Asian competitors can’t easily access. Engage with collaborative projects, partner with local research institutions, participate in EU Horizon Europe programs, and tap into regional development funds explicitly designed to support strategic technology development.
Consider the advantages of locating within established industrial ecosystems where you can access specialised talent, testing facilities, and potential customers within the same region. For my company, support from the Government of Biscay in northern Spain was key to building momentum in our early development and connecting with the region’s broader green tech cluster. Also, our involvement in PERTE (Strategic Project for Economic Recovery and Transformation) and other collaborative projects helped us to push technological boundaries while staying aligned with environmental policy.
5. Focus on total lifecycle value rather than upfront costs
While Asian manufacturers optimise for unit production costs, European companies can compete on durability, recyclability, and regulatory compliance. Develop proprietary battery management systems with advanced thermal management and optimisation technologies that deliver superior performance across multiple use cycles. Many companies that need batteries care more about avoiding downtime than minimising initial purchase costs. A battery that costs 30% more upfront but delivers 50% longer service life with predictable maintenance schedules becomes an easy purchasing decision for industrial buyers.
The path forward
Success requires discipline. Avoid the temptation to chase large commodity markets, where you’ll inevitably lose on price. Instead, focus relentlessly on applications where your European location, regulatory expertise, and ability to provide specialised solutions create genuine value that customers will pay for.
The goal isn’t to replace Asian suppliers entirely, but to build resilient companies that can work alongside Asian giants, rather than compete directly on their terms.
European production is very likely to cover at least 50–60% of the domestic demand by 2030. Market projections suggest European companies could capture 25-30% of the specialised industrial battery market by 2030 through technological differentiation and regulatory advantages. By focusing on our strengths, we will create resilient companies that can work alongside Asian providers. Together, we can produce the best green energy storage structure for Europe.
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