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Why The EV Industry Has A Massive Supply Problem

CNBC・41 minutes read

JB Straubel founded Redwood Materials to recycle batteries and supply Panasonic to reuse in Tesla cars, recognizing the importance of recycling for sustainability while reducing CO2 emissions. Efforts are underway in the US to boost domestic lithium production and battery manufacturing, aiming to transition to cobalt-free battery technologies to increase energy density and safety in electric vehicles by 2030.

Insights

  • **Recycling batteries is crucial for sustainability** due to high recovery rates of materials like nickel, cobalt, and copper, which can significantly reduce CO2 emissions from mining and manufacturing, aiding electric vehicles in achieving carbon neutrality.
  • **Companies are innovating to develop cobalt-free battery technologies** with higher energy density and lower costs, such as Spark's NFA cathode material and Tex Power's lithium metal anodes, aiming to revolutionize the battery market and potentially capture a significant share by 2030.

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Recent questions

  • Why is battery recycling important?

    Battery recycling is crucial due to the high recyclability of critical materials like nickel, cobalt, and copper, with 95-98% recovery rates. Recycling batteries can reduce CO2 emissions from mining and manufacturing, aiding electric vehicles in achieving carbon neutrality. It is essential for sustainability and helps address the volume of end-of-life batteries from EVs.

  • What is the demand for lithium-ion batteries?

    The demand for lithium-ion batteries, mainly for electric cars, has surged in recent years, with expectations of reaching $94.4 billion by 2025. This growth is driven by the increasing adoption of electric vehicles and the need for energy storage solutions in various industries.

  • How are companies contributing to battery recycling?

    Companies like Redwood Materials, in partnership with companies like Panasonic and Amazon, are actively involved in recycling a wide range of lithium-ion batteries. They aim to recover materials efficiently for reuse, contributing to the sustainability of battery production and reducing the environmental impact of mining.

  • What are the challenges in lithium production in the US?

    The US faces challenges in lithium production, with a need to secure domestic sources for national security and environmental reasons. Efforts are underway to explore lithium resources in Nevada, North Carolina, California, and Arkansas to boost domestic production and reduce reliance on imports.

  • What are the advancements in cobalt-free battery technologies?

    Companies like Sparks and Tech Power are developing cobalt-free battery technologies with higher energy density and lower costs. These advancements aim to address concerns related to cobalt supply challenges, cost, and human rights issues, offering a more sustainable alternative for battery production.

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Summary

00:00

Battery Recycling: Sustainability and Profitable Growth

  • The issue of waste and scrap, particularly with batteries, is significant, with cobalt-free batteries operating at higher voltages and being prone to fires.
  • Lithium, while not a major cost component in batteries, is crucial for their functionality, serving as a common denominator in various battery technologies.
  • JB Straubel, a co-founder of Tesla, left the company in 2019 to focus on recycling batteries through his startup, Redwood Materials, which recycles tons of batteries and supplies recovered materials to Panasonic for reuse in Tesla cars.
  • The recycling of batteries is essential due to the high recyclability of critical materials like nickel, cobalt, and copper, with 95-98% recovery rates.
  • The demand for lithium-ion batteries, mainly for electric cars, has surged in recent years, with expectations of reaching $94.4 billion by 2025.
  • The supply chain for batteries involves a mix of metals and minerals sourced globally, with a looming shortage of materials like lithium, nickel, cobalt, and copper.
  • Recycling batteries is crucial for sustainability, as it can reduce CO2 emissions from mining and manufacturing, aiding electric vehicles in achieving carbon neutrality.
  • Redwood Materials, in partnership with companies like Panasonic and Amazon, recycles a wide range of lithium-ion batteries, aiming to recover materials efficiently for reuse.
  • Consumers can contribute to battery recycling by dropping off old electronics at designated locations, where recyclers will extract valuable materials for reuse.
  • The lithium-ion battery recycling market is projected to grow significantly, reaching $18.1 billion by 2030, offering both environmental benefits and profitable business opportunities.

11:57

Battery Recycling: Profitable, Essential, and Sustainable

  • The profitability of unit operations is crucial, refining and selling input materials at a profitable margin.
  • Recycling companies, especially in China and the US, are rapidly expanding due to the profitability of recycling batteries.
  • Lifecycle, a major player in North America, operates battery recycling plants in Ontario, Canada, and Rochester, New York, with plans for further expansion.
  • Recycling batteries is more efficient than mining, using less energy, water, and reagents, leading to lower costs.
  • Recycling companies benefit from higher prices set by the mining industry, making it a profitable venture.
  • Recycling batteries is essential for the 21st-century supply chain, with a focus on addressing the volume of end-of-life batteries from EVs.
  • The goal is to improve recycling technology to surpass geological mining and create a closed-loop system.
  • The US faces challenges in lithium production, with a need to secure domestic sources for national security and environmental reasons.
  • Efforts are underway in the US to explore lithium resources in Nevada, North Carolina, California, and Arkansas to boost domestic production.
  • The Biden administration aims to jumpstart domestic lithium production and battery manufacturing, setting a national goal of 50% EV sales by 2030.

24:33

Lithium Extraction Innovations Transform Battery Industry

  • Piedmont will supply about a third of its planned 160,000 metric tons per year of spodumene Concentrate from its deposits in North Carolina.
  • Two companies in Arkansas, Galvanic Energy and Standard Lithium, are working on extracting lithium from underground brine reservoirs.
  • A similar project is underway in California at the Salton Sea, where lithium is found in superheated geothermal brine.
  • The Salton Sea is being transformed into "Lithium Valley" to generate revenue for restoring the lake.
  • Controlled Thermal Resources in Imperial Valley, California, is close to producing lithium, with a 50-megawatt power plant online in 2023.
  • Lithium Americas is developing a massive open-pit lithium mine at Thacker Pass, expected to produce 60,000 tons of lithium carbonate equivalent per year.
  • The Thacker Pass project aims to handle both mining and lithium refinement on-site, streamlining the supply chain.
  • Lilac Solutions in Oakland, California, is working on sustainable lithium extraction methods, while companies like Redwood Materials focus on recycling depleted batteries for lithium recovery.
  • Cobalt, a crucial material in lithium-ion batteries, is being phased out due to cost, human rights concerns, and supply challenges.
  • The demand for raw battery materials like cobalt is expected to rise significantly with the projected increase in EV sales worldwide.

37:12

Recycling Cobalt: Easing Demand, Lowering Costs

  • Recycling cobalt from old batteries can help ease demand for new cobalt mining.
  • Companies like Redwood Materials and Canada base lifecycle are emerging to recycle cobalt, but some recycling processes are environmentally unfriendly.
  • Cobalt recycling involves smelting old batteries at temperatures over 1000°C to extract cobalt due to its high cost.
  • Cobalt's price volatility is linked to its production as a byproduct of nickel and copper mining.
  • The majority of battery-grade cobalt reserves are in the Democratic Republic of Congo, where mining is associated with human rights abuses.
  • Chinese investors control a significant portion of Congo's mining sector and cobalt refining industry.
  • Different types of lithium-ion batteries are distinguished by the metals in their cathodes, with NMC batteries dominating the market.
  • Cobalt-free batteries like Lithium Iron Phosphate (LFP) exist but have lower energy density, limiting driving range.
  • Companies like Sparks and Tech Power are developing cobalt-free battery technologies with higher energy density and lower costs.
  • Spark's NFA cathode material, licensed from Oak Ridge National Laboratory, offers twice the energy density of LFP batteries at a lower cost.

49:30

Advancements in High-Energy Lithium Batteries

  • Tex powers is developing high-energy cells with lithium metal anodes and advanced cathode materials, achieving energy densities exceeding 500 Watt hours per kilogram, double that of current lithium-ion batteries.
  • Automakers are conducting safety testing before potentially incorporating cobalt-free battery chemistries into electric vehicles, with prototypes expected by the end of 2023, aiming for 20% of the global battery electric vehicle market by 2030.
  • Companies like Hyundai and Kia are exploring solid-state electrolyte batteries to enhance cobalt-free chemistries, aiming to increase driving range, safety, and charging speed, with potential to double current energy density levels.
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