Making an electric car battery, minus China

The global transition to green technologies has dramatically increased the demand for lithium. This crucial mineral, abundant but unevenly distributed, is essential for energy storage and electrification of transportation. According to the International Energy Agency, demand for lithium could increase by 2040 42 times the 2020 level.

Lithium-ion batteries are used to power electric vehicles and store renewable energy such as wind and solar energy. In 2023, the demand for batteries will increase exceeded 750 GWhan increase of 40 percent compared to 2022. Thanks to them high energy densitylong lifespan and efficient discharge capabilities, these batteries have become crucial in the field of energy storage and electric mobility.

By 2040, more than two-thirds of passenger cars will be electric. Lithium-ion batteries are also critical grid storage systems, ensuring the reliability of the electricity grid by balancing energy input and output.

Their efficiency and lightweight nature also make them vital for portable electronics, such as smartphones – in 2022 alone. approximately 1.39 billion smartphonesusually powered by lithium-ion batteries, were sold worldwide.

However, a mismatch between supply and demand, especially in the components used to manufacture these batteries, poses several challenges for these exponentially growing markets.

Key markets for electric vehicles – and therefore lithium-ion batteries – include the US, Europe and China. India is one of the largest importers of lithium-ion batteries and the size of the lithium-ion battery market estimated In 2024, this amount will reach $4.71 billion. By 2029, this is expected to reach $13.11 billion.

The problem lies in one overwhelming dependence on China for the refining and production of lithium and lithium-ion batteries, posing a significant challenge to several countries’ sustainability goals.

Challenges in the lithium supply chain

The production of lithium-ion batteries depends on: complex global supply chain. This starts with mining companies extracting the mineral and refining it on site to produce raw materials for batteries. Raw materials typically include lithium, cobalt, manganese, nickel and graphite.

Manufacturers purchase these raw materials and use them to produce cathode and anode active battery materials. These active materials are then bought by traders and sold to companies that produce battery cells.

Battery manufacturers assemble the battery cells into modules and then package and sell them to buyers such as automakers, who install the finished batteries in electric vehicles.

The problem starts with the availability of the main raw material – lithium – its processing and refining, and finally the production of active materials. Nearly 80 percent of known lithium deposits are located in four countries: South America lithium triangle of Argentina, Bolivia and Chile, and Australia. However, the market is dominated by China – a country with meager reserves of its own.

Despite having less than 7 percent of reserves, China is the largest the world’s largest importer, refiner and consumer of lithium. Sixty percent of the world’s lithium products and 75 percent of all lithium-ion batteries are produced in China. This especially stimulates the Chinese electric vehicle market, that is 60 percent of the world total.

Although the US, Europe and India have begun production of lithium-ion battery packs, production of the most critical components of the lithium-ion battery value chain – cathode and anode active materials – remains concentrated in China. Depending on the chemistry of the lithium-ion cells, the cathode-active material would make up 35-55 percent of the cell, and the anode-active material 14-20 percent. Countries looking to increase the supply of lithium-ion batteries should focus on manufacturing these components.

Today it represents China almost 90 percent of the global production capacity for active cathode material, and more than 97 percent of the production capacity for active anode material. The remaining gaps in production capacity are being filled by South Korea and Japan.

Efforts are underway to move towards a more sustainable, cost-effective and energy-dense lithium-ion cell chemistry. For example, there is the NMC battery cell, where the active cathode material is made from a combination of nickel, manganese and cobalt. Nickel increases energy density, and manganese and cobalt are used to improve thermal stability and safety. Then there is the NCA cell, or the nickel-cobalt-alumina cell, where the manganese is replaced with aluminum to increase stability. One of the most coveted cell chemistry technologies is lithium cobalt oxide. Of its high specific energy and long run timesit is considered ideal for smartphones, tablets, laptops and cameras.

The star of cell chemistry, however, is the LFP lithium iron phosphate battery. Thanks to their thermal stability, LFP batteries are safer and have a longer lifespan. particularly suitable for off-grid solar systems and electric vehicles. They also perform well at high temperatures and are environmentally friendly due to the absence of cobalt.

Today, LFP has grown from a small share of battery production to the rising star of the battery industry. LFP battery cells are powered more than 40 percent of the demand for electric vehicles worldwide in 2023. This is more than double the share recorded in 2020.

Efforts are also being made to increase the manganese content of both NMC and LFP. This is being done increase energy density while keeping costs low for LFP batteries, and reducing costs while maintaining high energy density for NMC cells.

Increasing domestic production

An alternative to making energy storage cost-effective and reducing dependence on crucial minerals such as lithium is sodium-ion batteries. While these batteries still require some critical minerals, such as nickel and manganese, they reduce dependence on lithium. Sodium ion batteries, like LFP, were also initially developed in the United States and Europe.

But China has also taken the lead here production capacity is estimated to be about ten times higher than the rest of the world combined.

The price of raw materials plays a major role in replacing lithium batteries with sodium ion batteries; currently prices are low and investments are discouraged postpone expansion plans.

Then there are supply chain bottlenecks, for example for high-quality cathode and anode materials needed for the production of sodium ion batteries. Until these issues are resolved, countries will need to build their own capacity to ramp up their lithium-ion battery production.

A few companies in India their production projects have started with government supportand many others plan to do so. However, the success of this, and others around the world, will depend on the localization of components in the lithium-ion value chain, such as the active materials for cathode and anode, separator and electrolytes.

Separators continue to work separating the anode and cathode active materials to prevent short circuits; they also contribute to the overall functioning of the cell, including its thermal stability and safety.

A few Indian companies are now preparing to produce lithium-ion cathode and anode active materials, as well as separators for the domestic and global lithium-ion battery supply chain. They have also developed the technology for the production of active raw materials for batteries based on sodium ions and aluminum.

Such innovations will be crucial for the energy transition goals of countries like India, which currently rely heavily on the import of battery raw materials.

Originally published under Creative Commons Through 360info™.