By 2023, almost one quarter of all energy consumed in the EU will come from renewable sources. This is twice as much as in 2010, when the share was 12.5%. Building on this progress and in order to maintain momentum, in 2023 EU Member States set a binding target for 2030: the share of renewable energy in the energy mix should reach at least 42.5%.
Using renewable sources such as wind, solar and hydropower offers a sustainable and vital alternative to burning fossil fuels, enabling Europe to produce its own clean, secure and affordable energy. In 2024, almost half of electricity demand could be met by renewables. With the decarbonisation of the economy, electrification rates must increase significantly, along with the demand for storage solutions.
Although renewable sources cannot be depleted in the same way as fossil fuels, they are “variable,” meaning their availability fluctuates. That is why it is important to invest in technologies that can address this challenge. Energy storage solutions – such as batteries – play a crucial role here. Technological advances and market uptake have already had a positive impact on the storage sector: according to the International Renewable Energy Agency (IRENA), battery storage costs have fallen by 93% since 2010.
Hydropower – a leading storage solution
Pumped-storage hydropower plants are the largest energy storage technology worldwide. They work by pumping water into reservoirs when there is surplus electricity in the grid – for example, on a sunny or windy day – and releasing it when more energy is needed.
In the EU, installed pumped-storage hydropower capacity stands at 46 GW, representing almost one quarter of the global total.
Moreover, between 2019 and 2021, EU companies accounted for 29% of all high-value inventions in hydropower worldwide.
Growing interest in batteries
Batteries are often associated with phones, laptops, watches, etc. but consumer electronics accounted for only 2% of global battery demand in 2023. At the same time, mobility applications (such as electric vehicle batteries) and stationary energy storage systems accounted for 86% and 12% respectively. This paints a clear picture of the impact of the energy transition and electrification on global battery demand.
According to the International Energy Agency, average global demand in the energy sector – for both EV batteries and storage applications – in just one week of 2024 exceeded total demand for an entire year only a decade earlier. In this context, in 2024 the sector reached a historic milestone of 1 TWh in battery demand.
In the EU, according to the Quarterly Report on European Electricity Markets, more than 620,000 new electric passenger cars were sold in the first three months of 2025. This marks a record high for any first quarter, 15% more than in the same period of the previous year, bringing the EV market share of new passenger cars in the EU to 21%.
Securing battery supply in the EU
The global battery sector is highly competitive. According to the 2025 Clean Energy Technology Observatory report, the EU accounted for 8% of global lithium-ion battery production capacity in 2023, generating around 90,000 direct jobs for the EU economy, compared to 61,000 in 2022. However, the EU still relies on imports to meet around 50% of its consumption, while approximately 83% of global lithium-ion battery capacity in 2023 was located in China.
In this regard, the EU is firmly determined to close the gap with China and the US and to establish itself as a global leader in this key industry.
As part of these efforts, in July 2025 the European Commission announced €852 million in strategic investments for six pioneering projects to produce battery cells for electric vehicles, through grants from the Innovation Fund. This followed the Commission’s 2023 announcement to strengthen EU battery manufacturing capacity with targeted support of up to €3 billion to boost investment in local cell production, aiming to reduce dependence on foreign suppliers.
The EU Battery Regulation, which entered into force two years ago, ensures that Europe’s battery ambitions are not tied to environmental costs. It supports the EU’s circular economy and zero-pollution goals, while strengthening Europe’s strategic autonomy in the battery sector.
New energy storage solutions
Beyond batteries and pumped-storage hydropower, the EU ranks second after the US in the number of companies developing new energy storage technologies, and it leads in the field of liquid air energy storage.
Between 2019 and 2021, the EU filed 277 patent applications, 54% of which are considered high-value inventions. By comparison, China filed 5,000 applications, of which only 3% were high-value. Nevertheless, both regions show similar levels of valuable innovation.
A lack of reliable data remains a challenge in analysing emerging energy storage markets. The European Commission’s Energy Storage Registry, launched in March 2025, helps bridge this gap. It is the first EU-wide tool of its kind, offering a real-time dashboard on energy storage levels in Europe and covering the full spectrum of storage technologies.
More information is avalable on EC website.
