Europe’s EV battery cost gap with China – currently around 90 percent – could shrink to roughly 30 percent by 2030 if Brussels is willing to pay what campaigners call a “sovereignty premium.”

That’s the gist of a new analysis [PDF] from Transport & Environment (T&E), released ahead of the European Commission’s delayed unveiling of the Industrial Accelerator Act, which argues Europe’s battery headache isn’t a lack of chemistry know-how, but rather a simple case of not having built enough yet.

If Brussels backs the sector properly and factories actually ramp up, the report reckons the EU-China cost gap could fall from 90 percent to about 30 percent by 2030, leaving a difference of roughly $14 per kilowatt-hour.

On a typical electric vehicle, that works out at an average €500 premium for a battery made in Europe rather than imported, a figure T&E frames not as a crippling cost but as a sovereignty premium for greater supply chain resilience.

To get there, the group says Europe will need more than a dreamy wishlist of factories. The continent has to get better at actually making batteries, which means driving down scrap rates, tightening up processes, automating where it makes sense, and generally moving up the manufacturing learning curve that Chinese producers have already spent years climbing.

T&E argues that scale won’t magically appear on its own. If Brussels wants European plants to reach the volumes needed to compete, it has to tie public money to real local production. That means slapping clear “Made-in-EU” conditions on subsidies and tax breaks so that support for EVs and battery projects translates into cells built in Europe – not just press releases and imported packs.

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That logic mirrors earlier transatlantic efforts to secure upstream supply chains, including proposals for a US-EU “critical minerals club” aimed at reducing dependence on Chinese processing of key battery materials.

Not everyone is convinced. Some automakers warn that strict local content requirements could push up costs and complicate supply relationships at a time when global competition is intensifying. But T&E’s pitch is that without such rules, European producers may never achieve the scale needed to compete on price.

The report lands just as Brussels gears up to unveil its Industrial Accelerator Act, a wide-ranging plan to funnel public money into “strategic” industries like batteries, renewables, and hydrogen. The act was originally scheduled for presentation last week, but EU regulators were forced to delay after “Made-in-EU” provisions in the draft text drew strong resistance, with critics saying it posed risks of closing the EU market, price hikes, and bureaucratic overload.

T&E’s message is clear, however. The cost gap with China doesn’t have to be permanent, but closing it will take more than wishful thinking. Whether Europe’s policymakers agree could define the bloc’s role in the global electric vehicle race. ®