Written evidence from Ilika Technologies (ELV0097) 

Environment and Climate Change Committee

Call for evidence.

This evidence paper has been produced by Ilika Technologies Ltd for consideration by the Environment and Climate Change Committee in its inquiry, the aims of which are:

• To understand how the Government will achieve its upcoming 2030 and 2035 deadlines for the phase out dates for non-zero emission vehicles, with a focus on passenger cars, as well as exploring the main obstacles and barriers to meeting these targets.

• To understand the costs, alongside the benefits, associated with the 2030 phase out date, and to understand Government progress towards decarbonising car usage by this earlier date. the role of battery and fuel cell technologies in achieving the UK’s ambition to reach net-zero greenhouse gas emissions by 2050.

Company information:

Ilika Technologies is a pioneer in solid state battery technology, based in Hampshire and listed on the London Stock Exchange (LSE: AIM, IKA). The company was originally spun out of the University of Southampton in 2004 and has grown to be the UK’s largest pure-play publicly listed battery company. Ilika has developed miniaturised solid state batteries (“Stereax”), designed specifically for the Med tech and industrial IOT markets due to their unique properties of wide temperature range, small footprint, and high energy density.

In 2018, with Faraday Battery Challenge (FBC) support, Ilika began developing large format solid state batteries for automotive applications (“Goliath”). We now operate a pre pilot line from our facility and are currently engaged in a further FBC programme to accelerate development of a prototype solid state battery EV pouch cell, due in Q1 2025. Thereafter the expectation is that with support from the Advanced Propulsion Centre (APC), industry and investors we will be able to deliver a solid-state battery for EV’s. Our anticipated time to market is 2030.

Our FBC grant funding has enabled us to leverage a further £25m in equity funding from the London capital market, increasing our R&D spend by a factor of 5. We have also worked with the APC and Automotive Transformation Fund (ATF) to scale up the production of our batteries. Further support from UK catalyst CPI and importantly the UK Battery Industrialisation Centre (UKBIC) has also fed into our technology and manufacturing development.

Our interest is in securing long term investment and support at governmental level for automotive technology development, which typically has long lead times (7+ years to market) and rigorous validation processes.  

Why solid-state technology?

Electrification will be crucial to achieving Net Zero, and battery technology is critical to the uptake of EV’s needed to support electrification.

Currently LIBs are the most widely used type of rechargeable battery in the world, due to their high energy density (270Wh/kg, 700 Wh/l) and long cycle-life (~1000 cycles). However, conventional LIBs are quickly reaching their maximum capabilities, with only small increments in energy and power densities possible over the coming 10 years. Other liquid-based technologies, such as Li-metal, could provide higher energy densities to 350Wh/kg but serious technical challenges still exist that may be hard to overcome. These limitations in chemistry translate directly into EV performance limitations and feed into consumer concerns about transitioning to EV’s.

The top concerns that discourage most buyers from purchasing an EV include:

• Limited driving range
• Lack of charging infrastructure
• Slow time to charge.
• High purchase cost
• Safety

Solid state batteries have the potential to exceed 400Wh/kg (1000Wh/l) over the next 3-5 years, surpassing LIBs, and eventually reaching an energy density of 500Wh/kg.

Low-cost solid-state batteries with high cycle-life have the strong potential to power future electrified and sustainable mobility, once manufactured at scale. Solid-state batteries promise a leap forward with improved safety, higher energy density, faster charging times, and longer life. The technology is a potential cure-all for the drawbacks facing electric vehicles that run on conventional lithium-ion batteries. In addition, the non-flammable solid electrolyte allows easier thermal management and more efficient packing density going from cell to pack; this translates into a less flammable and safer EV battery.

Ilika’s solid-state technology will be equally applicable to aviation, maritime as well as the wider energy system.

In setting out Ilika’s involvement with solid state technology above, we have very briefly described the huge potential of the technology, its development time frame, and its applicability to a wide range of applications. Ilika is very happy to supply more detailed information on any of these areas on request.

Question: What are the main obstacles to the achievement of the Government’s 2030 and 2035 phase-out dates? Are the phase-out dates realistic and achievable? If not, what steps should the Government take to make the phase-out dates achievable?

The UK will not be able to meet the Governments timelines without significant technology innovation. Innovation is core to every stage of the EV lifecycle from materials to manufacturing, rechargeable batteries, charging infrastructure and second life and recycling. The UK is exceptionally well placed to meet these challenges given its long heritage of innovation within its academic institutions, catalysts, start-ups, and SME’s.

New EV technologies inevitably involve new materials, processes, equipment, skills, and resources and so it is critical that supply chain development runs in parallel with technology development. We see significant strategic funding being deployed worldwide particularly in the US, Japan, Korea, Taiwan and China.

One of the major issues facing technology companies, often SME’s such as Ilika, is the long time to market for their technologies and the continued need for investment and support up until revenue generation. FBC, APC and ATF have catalysed and brought together a large EV and battery community in the UK. It is the FBC commitment to Ilika that enabled us to leverage investor funding, as government financial support is seen as a validation of the technology and a way to share risk in early stage, high risk technology programmes. Conversely, lack of financial support from government can have the opposite effect and negatively impact on the ability to gain investor funding.

However, grant funding for the battery industry is often piecemeal, short term and delivered through general rather than strategic competitive programmes. This has led to a lack of continuity and to decisions being made which are not aligned with strategic development. Having short term project funding does not give companies the opportunity to develop medium to long term plans, to retain a team of experienced staff, nor to be able to offer any degree of certainty to potential customers. It can also undermine previous grant funding, with equipment sitting idle and development on hold, enabling those from outside the UK with committed funding to take a technological lead.

Ilika believes that battery technology support, given the high levels of funding and commitment needed to create an EV centre of excellence with the UK as a science superpower, should be strategic, committed, well planned and should enable the UK government and industry to collaborate to develop and implement a joint roadmap for delivery of the technology for and on behalf of the UK. With this level of support, investor funding would be unlocked to and would increase UK R&D spend thereby enabling the government to achieve its 2.4% of GDP target.

Ilika remains optimistic about the potential to develop a world class EV ‘hub’ in the UK, aiding the transition to EV’s. We believe there are three policy issues which could further support the UK EV industry:

• Doubling both the lifetime limit on VCT/EIS funding an individual company can receive (currently £20m for knowledge-intensive businesses) and the gross asset limit (currently £15m) to reflect the significant cost of developing new hard-tech products.
• Reversing the government’s recent decision to cut R&D tax credits to SMEs from 130% to 86%. It could be argued that SMEs are driving the innovation and should therefore be nurtured and supported.
• Continuing to allocate high levels of funding to FBC and APC to support new product development.

We would very much welcome the opportunity to give oral evidence through our CEO, Graeme Purdy.