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EV Batteries: Deep Dive

Nexus PMG

Operating at the intersection of project finance, development and operations, Nexus PMG provides world-class advisory services, delivering technical, operational and financial diligence through every phase of low-carbon infrastructure projects.

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Sidney Key
Project Engineer at Nexus PMG

After graduating from Clemson University with a BS in Mechanical Engineering, Sidney joined Nexus PMG as a Project Engineer, where he uses his breadth of focus in sustainable and low-carbon industries to create value for each project he works on. Sidney has a passion for working on projects that make a difference and enjoys being able to apply that passion at Nexus PMG.

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EV Batteries: Deep Dive

Bloomberg New Energy Finance believes that by 2040, 58% of all global vehicle sales will be electric. That’s over 55 million electric vehicles being sold annually, up from less than 3 million now. If that comes to bear, it will mark a massive shift away from the dominant internal combustion engine (ICE) and the entire auto manufacturing and fueling complex that supports it. It will also spark a great race to secure enormous amounts of raw materials required for these new batteries. This week, we look at the components that will take the place of the ICE engine in the shift to EVs, who controls them, and what that means for the automaking landscape.

Electric Vehicle Battery Technology Breakthroughs Loom

EV batteries create energy through a chemical reaction in which lithium ions move from a negative electrode through a liquid electrolyte into a positive electrode during discharge (energy use). There are many types of cathode materials that help store and transfer the lithium ions, but in a typical EV battery, the cathode contains around 40 kg of nickel, 15kg of cobalt, 15kg of manganese and 63 kg of lithium. Tesla’s Model S swaps out the manganese for aluminum. Engineers are trying to maximize the amount of cheap and energy-dense nickel at the expense of costly and hard to obtain cobalt. Tesla hopes to completely eliminate cobalt within a few years. On the anode side, we see around 54 kg of graphite and silicon that act to store the lithium ions prior to discharge.

Lithium-ion is the dominant chemistry for the cathode, either as lithium manganese oxide or lithium cobalt dioxide. Another technology, lithium iron phosphate (LFP), has a lower energy density than lithium-ion but is cheaper, safer, operates better at higher temperatures and has a much higher lifecycle. Some see the market splitting into lithium-ion for high energy density uses like higher range EVs while LFP may be used more predominantly in cheaper, lower range EVs and stationary power batteries where energy density is less of an issue. Cheaper LFP batteries are widely used in Chinese electric cars and buses. Per Elon Musk: “We need to have a three-tiered approach to batteries, starting with iron [LFP] that’s medium-range, and then nickel manganese as medium plus/intermediate and then high nickel for long-range applications like cybertruck and the semi.”

Obtaining the necessary minerals to produce a single 1,000 lb EV battery involves mining, moving and processing 500,000 lbs of raw materials. As the electric vehicle industry expands, we could collectively require 6-10 times the amount of lithium, nickel, cobalt, graphite and manganese being used in the world right now, just for electric vehicle batteries. Seventy-five percent of the world’s nickel deposits are found in a few countries, including Australia, Indonesia, South Africa, Russia and Canada. As engineers start to jam more nickel into the batteries at the expense of cobalt, there could be more pressure on this commodity. As Elon Musk put it in September: “Please make more nickel!”

The biggest source of cobalt is the Democratic Republic of Congo, which has a dubious record for worker safety and child labor. As EV numbers multiply, so will the need for these elements and compounds. Currently, the US controls zero percent of the world’s cobalt, nickel and graphite raw materials sourcing and chemical production. The US produces 1% of the world’s raw lithium and 7% of the world’s lithium-ion chemicals. And by virtue of Tesla’s Gigafactory in Nevada, the US is the source of around 7% of the world’s lithium-ion batteries. In other words, the US is a bit player in the production of the key inputs required for the coming wave of electric vehicles. As you might imagine, most of the raw materials and battery production are coming from China right now. Tesla’s Elon Musk is keenly aware of this dilemma and has set in motion plans to mine lithium and other key inputs from sources in North America, a nearly unthinkable reach back into the production value chain for a traditional automobile manufacturer.

EV batteries have capacities that are measured in kilowatts per hour needed to run a vehicle for 100 miles (kWh, for short). Typical, EV batteries are commonly in the range of 20-50 kWh while Tesla’s model S and X have 75 kWh battery capacity, potentially going to 100 kWh soon. The Rivian EV van that Amazon has invested in will have a capacity of 180 kWh and GM recently announced that its Ultium batteries, under development via a partnership with Korean chemical giant LG Chem, will range from 50 kWh to a massive 200 kWh battery that would power an electric Humvee. The cost of electric vehicle batteries has fallen steeply from $1,100 per kWh in 2010 to around $156 per kWh last year. Prices are expected to continue to fall on a $/kWh basis, perhaps crossing the $100/kWh threshold that the DOE says is the equivalent of a typical ICE vehicle in price performance in the next 5-10 years.

Another future development could be the arrival of solid-state batteries. In current EV batteries, the cathode and the anode sit in a liquid lithium salt electrolyte which enables the transfer of the electrons to produce electricity. Batteries with a solid electrolyte, which are under development by Fisker (backed by Caterpillar), Solid Power (Ford, Hyundai and BMW), and QuantumScape (Bill Gates, Volkswagen), greatly reduce size and weight while decreasing the risk of fires as they can operate at higher temperatures. Current solid-state technology is a long way away from being able to match the performance of current Tesla lithium-ion batteries but could provide a step-change in efficiency, weight to performance and safety if engineers can get them up to speed.

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