Title page 1

Contents 3

Acknowledgements 4

Summary 5

1. Why is resilience of clean energy supply chains important? 7

1.1. A more turbulent global economy is making daily life harder in the UK 7

1.2. Resilient clean energy supply chains are essential for the UK's future 9

1.3. Understanding the risks of disruption and their impacts on the UK 10

2. How can the government build resilient clean energy supply chains? 12

2.1. A broad set of tools should be deployed together to build resilience 12

2.2. The current approach to supply chain resilience is falling short 14

3. The battery supply chain 15

3.1. The pivotal role of the battery supply chain and its structure 15

3.2. Risk of disruptions in the battery supply chain from the UK perspective 16

3.2.1. Concentration of production capacity in the battery supply chain at the global level 16

3.2.2. UK import dependency in the battery supply chain 17

3.2.3. Other factors influencing resilience in the battery supply chain 17

3.3. Impact of battery supply chain disruptions for the UK 18

3.3.1. The UK's production capacity in the battery supply chain 18

3.3.2. Dependency ratio in the UK's battery supply chain 18

3.3.3. Impact of battery supply chain disruptions on national policy priorities 20

3.4. Policy actions to increase the resilience of the battery supply chain 20

4. The solar PV supply chain 22

4.1. The centrality of the solar PV supply chain and its structure 22

4.2. Risk of disruptions in the solar PV supply chain from the UK perspective 23

4.2.1. Concentration of production capacity in the solar PV supply chain at the global level 23

4.2.2. UK import dependency in the solar PV supply chain 24

4.2.3. Other factors influencing resilience in the solar PV supply chain 25

4.3. Impact of solar PV supply chain disruptions for the UK 25

4.3.1. The UK's production capacity in the solar PV chain 25

4.3.2. Dependency ratio in the UK's solar PV supply chain 25

4.3.3. Impact of solar PV supply chain disruptions on national policy priorities 27

4.4. Policy actions to increase the resilience of the solar PV supply chain 28

5. Steelmaking 30

5.1. The relevance of steelmaking for clean energy manufacturing and its main processes 30

5.2. Risk of disruptions in steelmaking from the UK perspective 31

5.2.1. Concentration of steel productive capacity at the global level 31

5.2.2. UK import dependency on steel 31

5.2.3. Other factors influencing resilience in steelmaking 32

5.3. Impact of steelmaking disruptions for the UK 33

5.3.1. The UK's steelmaking capacity 33

5.3.2. Dependency ratio in the UK's steelmaking industry 34

5.3.3. Impact of steelmaking disruptions on national policy priorities 35

5.4. Policy actions to increase the resilience of steelmaking 36

6. Critical minerals 38

6.1. The process of obtaining critical minerals for clean energy manufacturing 38

6.2. Risk of disruptions in critical minerals from the UK perspective 39

6.2.1. Concentration of critical mineral mining and refining capacity at the global level 39

6.2.2. UK import dependency on critical minerals 40

6.2.3. Other factors influencing resilience in critical minerals 41

6.3. Impact of critical minerals disruptions for the UK 41

6.3.1. The UK's capacity in mining and refining critical minerals 41

6.3.2. Dependency ratios in UK's access to critical minerals 42

6.3.3. Impact of critical minerals disruptions on national policy priorities 42

6.4. Policy actions to increase the resilience in critical minerals 43

7. Cross-cutting considerations on policy 45

7.1. Rethinking international relationships for resilience 45

7.2. Cross-cutting interventions 46

7.2.1. Addressing a gap in UK public finance institutions for concessional finance in international projects 46

7.2.2. Creating a focal point for collaboration on resilience in clean energy supply chains through the Global Clean Power Alliance (GCPA) 47

8. Conclusions 48

References 49

Appendix 54

Tables 10

Table 1.1. Factors for assessing the risk of disruptions within a supply chain 10

Table 1.2. Factors for assessing the potential impact of disruptions within a supply chain 11

Table 3.1. The battery supply chain 15

Table 3.2. Analysis of imports and dependencies in the battery supply chain 17

Table 3.3. Estimated impacts of a disruption to battery component supplies in 2030 19

Table 3.4. The impact of disruptions in the battery supply chain is significant on all major policy priorities but particularly on economic competitiveness 20

Table 3.5. Policy actions on the battery supply chain 21

Table 4.1. The solar PV supply chain 22

Table 4.2. Analysis of imports and dependencies in the solar PV supply chain 24

Table 4.3/Table 4.4. Scenarios of solar PV supply chain disruptions impacting the UK's solar deployment plans with estimated costs 27

Table 4.4/Table 4.3. The impact of disruptions in the solar PV supply chain is significant for energy security and net zero policy objectives 27

Table 4.5. Policy actions on the solar PV supply chain 29

Table 5.1. Main steelmaking processes 30

Table 5.2. Global steel production capacity 31

Table 5.3. UK foreign dependency on steel is worsening but import diversification is improving 32

Table 5.4. Disruptions to UK steelmaking would have serious and direct consequences for national economic competitiveness 36

Table 5.5. Policy actions on steelmaking 37

Table 6.1. The cycle of critical minerals extraction, deployment and recycling 38

Table 6.2. Critical minerals ARE extracted in a plurality of countries (mostly outside Europe), with concentrations varying depending on the specific mineral 39

Table 6.3. Disruptions to the UK's access to critical minerals would hinder the development of domestic clean energy manufacturing 43

Table 6.4. Policy actions for critical minerals 44

Table 7.1. Main countries for international collaborations on selected clean energy supply chains from a UK perspective 45

Figures 7

Figure 1.1. Geopolitical tensions are becoming a 'new normal' in the 2020s 7

Figure 1.2. China is set to overtake the G7 in manufacturing capacity 8

Figure 2.1. A taxonomy for policy actions that can be used to strengthen supply chain resilience 12

Figure 3.1. China dominates the entire battery supply Chain with its leadership preserved in battery components 16

Figure 3.2. Import dependency is set to be very high for battery components in 2030 19

Figure 4.1. The solar PV supply chain is dominated by China and is expected to remain so for the next decade, with only marginal growth from other Asia-Pacific countries 23

Figure 4.2. The UK's dependence on solar module imports is already high and likely to grow with the increased deployment of solar power 26

Figure 5.1. The UK's steelmaking capacity has been falling steadily since 2010 and more than that of other European countries 34

Figure 5.2. The UK dependency ratio in steelmaking will depend on future investments in steelmaking capacity 35

Figure 6.1. The refining of critical minerals is highly concentrated in China, and its dominance is set to persist in the following years 40

Figure 6.2. UK demand for critical minerals is set to skyrocket by 2030, and we are likely to be 100 per cent dependent on imports for most of these 42

Appendix Tables 58

Table A.1. HS codes used for analysis of solar and battery supply chains 58

Table A.2. Strategies and tools to increase supply chain security and resilience 59