Battery Passport Tracking: How to Implement Digital Passes Across Borders?

Entering 2023, battery passports have become a new trend in the industry.

In March, Zeng Yuqun, Chairman of CATL, as a representative of the 14th National People's Congress, submitted a proposal to conduct research on China's power battery passport and supporting policies, and strengthen the full lifecycle management of battery products.

He pointed out that it is necessary to research and design China's battery passport as soon as possible based on practical needs such as carbon footprint, ESG, recycling and traceability, and cascading utilization.

Recently, in the face of investors asking "how to make it easier for end consumers to use power batteries", CATL once again reiterated that because battery passports are digital twins of physical batteries, consumers can use battery passports to clearly see the "past and present" of their batteries, and compare the good and bad of batteries clearly.

At the Electric Vehicle Hundred People Forum earlier this month, Liang Rui, Vice President of Xinwangda, also pointed out that "the battery passport is essentially a data management system for the battery life cycle, which will bring higher transparency to the global battery value chain."

So, what exactly does a battery passport include? Why has it become a topic of concern for top companies at the current time? What is the significance of the transformation of the global lithium battery industry?

Battery passport originating from Europe

Understanding battery passports can be approached from both narrow and broad perspectives.

The narrow definition of battery passport is an industry initiative first proposed by the Global Battery Alliance (GBA) in 2019.

GBA was established by the World Economic Forum and is the first global battery association. Its members cover all aspects of the battery industry chain, with European giants such as Eurasian Resources Group, Glencore, BASF, and Volkswagen being the most active.

Starting from 2021, battery passports have been recognized at international high-level conferences such as G7 Group and OECD; In 2022, the German Ministry of Economy provided 8.2 million euros in funding to local associations, including BMW, Merck, and BASF, to develop industry standards for battery carbon footprint and put battery passports on the substantive agenda.

On January 18th this year, at the World Economic Forum held in Davos, Switzerland, the Global Battery Alliance (GBA) released the results of the battery passport concept validation for the first time.

It is worth noting that the reason why battery passports are named passports rather than ID cards is to highlight their effective cross-border mobility. Therefore, establishing a globally unified certification standard is crucial. This is particularly true when battery passports are linked to market access.

According to the EU's New Battery Law, starting from 2026, all newly purchased electric vehicle (EV) batteries, light vehicle (LMT) batteries, and large industrial batteries with a single capacity exceeding kWh must have a battery passport to enter the European market.

However, the formulation of cross-border rules inevitably involves unequal discourse power in the industrial chain. From the perspective of the membership structure of GBA, the current battery passport is still a cross-border project dominated by the EU background.

How to ensure the fairness and inclusiveness of battery passports to avoid becoming regional green trade barriers?

To answer this question, it is necessary to take a broader perspective on the significance of battery passports and the work that has already been done by all parties involved.

How to define a battery passport

According to the GBA official website, the battery passport aims to provide detailed battery manufacturing history and usage information to all stakeholders involved in the entire lifecycle. Its significance lies in several aspects:

Record the proportion of renewable energy and recycled materials used in the battery production process, in order to facilitate the procurement party's carbon index standard review and normalization evaluation;

Record the health status of the battery, upload cloud data, and promptly issue fault warnings to users to extend the service life of the battery and its carrying tools;

Trace and rate the historical information of the battery, accurately display the remaining capacity, and facilitate effective circulation in cascading utilization or secondary sales scenarios;

This coincides with the understanding of Liang Rui, Vice President of Xinwangda. At the Electric Vehicle Hundred People Conference, Liang Rui pointed out that although the data system of the battery passport looks very complex, it actually revolves around two main themes: quality management of the entire life cycle of the battery and carbon management of the entire life cycle of the battery.

To achieve these two goals, Liang Rui proposes three suggestions:

The first is to adopt measures to control the quality of the entire process, including research and development, raw materials, supplier materials, production process, customer finished products, and after-sales service.

The second is to establish an integrated digital platform for quality, organically integrating quality systems, business data, and information systems to achieve end-to-end quality management.

The third is big data management for the entire lifecycle of batteries. A system for condition assessment and safety warning must be established in the design, manufacturing, operation, vehicle maintenance and inspection, OTA dynamic management, and other aspects of power batteries. These data can provide strong support in areas such as vehicle insurance, secondary transactions, and cascading utilization.

It can be seen that in various explanations, battery passports ultimately appear as an end-to-end, all-around "comprehensive service platform". With this platform, buyers can manage the quality of the upstream supply chain, consumers can view product performance and make purchasing decisions quickly, and relevant governments can trace their carbon footprint throughout the entire process

To complete such a massive project, the government and leading enterprises undoubtedly play an important calling role.

For the government, at the "China 5G+Industrial Internet Conference" at the end of last year, the Ministry of Industry and Information Technology announced the establishment of the national top node of the industrial Internet identity resolution system. This indicates that the most core infrastructure required for cross regional and cross industry data exchange in China has been established.

At the beginning of this month, Tianfu Big Data International Strategy and Technology Research Institute, led by Sichuan Province, held a product launch event in Chengdu, during which the China Carbon Footprint Open Platform (CCFOP) was unveiled for the first time. The platform includes the eFootprint online analysis system for product carbon footprint and the China Life Cycle Basic Database (CLCD).

As digital infrastructure gradually improves, Gaogong Lithium Battery has observed that many leading companies in the industry chain are actively expanding their layout.

Chinese Enterprises' Efforts on Battery Passports

In addition to the mandatory entry provisions of the New Battery Law, the European Carbon Border Adjustment Mechanism (CBAM), also known as "carbon tariffs", was approved by the European Parliament on April 18 and is expected to be published in the Official Journal of the European Union in the near future, taking effect 20 days after its publication.

It can be said that battery passports will become a key factor in the success of domestic battery companies going abroad to Europe.

Therefore, the first batch of domestic enterprises actively responding to battery passports are all enterprises with clear internationalization strategies and have already created substantial overseas achievements.

In December 2022, Ningde Times was selected as the new board of directors of GBA, with a term from April 2023 to December 2024, and served as a member of the supervisory committee.

Last year, CATL's German factory was officially put into operation, marking its achievement of localized supply capabilities. At the same time, construction of its second factory in Hungary was also initiated.

Luoyang Molybdenum Industry, which has close cooperation with CATL, has also participated in the GBA project. At the World Economic Forum in Davos in January this year, the first batch of electric vehicle battery passports exhibited by GBA included the ReSource project jointly developed by Luoyang Molybdenum Industry, Glencore, and Eurasian Resources Group.

On April 19, 2023, GBA officially approved Xinwangda's accession, and Xinwangda became a new member of the organization.

In addition, Gaogong Lithium Battery has learned from relevant personnel at Greenland that its subsidiary, Wuhan Power Regeneration, is applying to join the GBA and has continued to cooperate with CATL on the landing of domestic battery passports.

In July of last year, Greenway issued GDR and was approved for listing in Switzerland, which will provide financial support for its European battery recycling project construction.

In terms of empowering the industrial chain, Yuanjing Power has laid out a zero carbon digital certification system based on the intelligent IoT operating system EnOS and Ark Energy carbon management platform in the Ordos Zero Carbon Industrial Park. While achieving 100% green energy supply, it also gives products in the park a "zero carbon green code" that is traceable, meets various international standards, and has been certified by authoritative institutions.

That is to say, the industrial chain enterprises that settle in the Yuanjing Park can produce low-carbon and zero carbon products that are internationally certified. It is reported that several upstream and downstream enterprises, including FAW Jiefang and Shengvanadium Technology, have announced their entry into the Ordos Zero Carbon Industrial Park.

In addition to the power battery industry chain, a major purpose of battery passports is to trace the historical information of cascading utilization scenarios. Therefore, the energy storage field has also launched dedicated research on battery passports.

In March, Zhongtian Internet and Zhongtian Energy Storage signed a strategic cooperation agreement. Zhongtian Internet stated that it will take the lead in implementing a complete battery passport solution in China, taking into account the characteristics of the Zhongtian energy storage industry; By assigning a unique identifier to energy storage batteries through battery passports, we can break down barriers on platforms such as MES, dual carbon platforms, and battery operation and maintenance management.

Gaogong Lithium Battery believes that as battery passports become an international consensus across different tracks at home and abroad, more companies will take the lead in improving the recognition of battery passports in specific regions and scenarios in the future, helping to implement unified international standards.

It is worth mentioning that in order to ensure the transparency and tamper resistance of the entire process information, the introduction of blockchain and artificial intelligence technology will become a necessity, which also makes battery passports show greater potential for application in the future.

At the same time, in the context of increasingly refined and strict supply chain management in leading enterprises, small and medium-sized enterprises upstream and downstream of the industrial chain will also be responsible entities, participating in the formulation of battery passports, so that they truly "come from the industry and be used by the industry".