Battery research funding cuts pose risk to Germany’s competitiveness – opposition

Cuts to battery technology research in Germany, which were triggered by a court ruling that confounded funding plans for climate and energy projects, could see the country fall behind in a key future industry, the opposition Christian Democrats (CDU) have warned. From the initially planned 155 million euros for battery research in 2024, Germany will likely only disburse about 30 million euros, according to a response from the research ministry (BMBF) to a parliamentary inquiry by the CDU seen by newspaper Handelsblatt. In 2023, the country earmarked 145 million euros for research into the storage technology. The budget cuts, caused by the court ruling on Germany’s Climate and Transformation Fund (CTF), which followed on a lawsuit filed by the CDU, could make the country more dependent on foreign suppliers, especially from Asia, party representatives warned.

Countries like South Korea, China, Japan, and also the U.S. have greatly expanded their battery research programmes in recent years, the government said in its reply. The technology that is crucial for many energy transition projects, including electric mobility and large-scale storage facilites, is dominated by Asian manufacturers and lower research spending in Germany would only deepen this gap, CDU research expert Thomas Jarzombek told Handelsblatt. Besides the direct impact of lower funding, this would also lead companies and researchers to look for other locations. “The cuts by the research ministry are bad news in this regard. We will feel the consequences gradually in the next years,” he argued.

A ruling by Germany's highest court in November 2023 declared an integral part of the government's funding plan for climate and energy programmes unlawful, dealing a major blow to the coalition of chancellor Olaf Scholz. The court's decision has thrown the coalition's funding plans through a special "Climate and Transformation Fund" worth 60 billion euros into disarray, causing major uncertainty among policymakers, industry and citizens waiting to implement new projects. Already in January, a research and development alliance representing Germany’s battery industry blasted government plans to slash research and development funding for the field, warning that the move would “lead to the end of German battery research.”