Russia’s aggression in Ukraine might have unintended consequences for the green mobility transition.
In the immediate aftermath of the Russian invasion of Ukraine and the sanctions imposed on Russia by western nations, trading on the Moscow Stock Exchanges was halted for several days. But curiously, trading in a particular commodity was halted on the London Metal Exchange also. The said commodity was nickel whose price quadrupled as the invasion began and before trading was halted. Nickel is an important metal in lots of areas, most importantly steel, where nickel is a vital ingredient of stainless steel, particularly grades that are used in construction and automotive manufacturing.
But nickel is also a vital element used in batteries. In fact, Nickel-Metal Hydride (Ni-MH) batteries were the first mass-scale rechargeable batteries made. And even though lithium has replaced nickel as the ‘core’ element used in most large rechargeable battery systems today, from consumer electronics such as laptops and smartphones to electric vehicles, the primary battery technology used in the space is something called Lithium-Nickel, Manganese and Cobalt (Lithium-NMC). Given the differences in elemental weight between lithium and nickel, the amount of nickel by weight in an average electric vehicle battery is significant. A recent study by the International Energy Agency(IEA) estimates that in a sustainable development scenario, battery demand from EVs will grow 40 times between 2020 and 2040, leading to a staggering 41-fold increase in the demand for nickel.
The massive rise in the price of nickel has sent shockwaves through the global steel industry but it is forcing manufacturers of electric cars to figure out alternative sources of finished nickel other than Russia, where almost 12 percent of the annual yield of nickel comes from, however, it is Indonesia that is the world’s largest nickel extractor accounting for a third of the world’s production.
A recent study by the International Energy Agency(IEA) estimates that in a sustainable development scenario, battery demand from EVs will grow 40 times between 2020 and 2040, leading to a staggering 41-fold increase in the demand for nickel.
And it is not just nickel that creates a problem, lithium itself poses a significant issue. The four largest proven reserves of lithium are in Argentina, Chile, Australia, and China. Significant reserves have been prospected in Bolivia, Peru, and even the United States (US) but environmental concerns regarding the extraction of lithium have hampered mining efforts. It is believed that more reserves of lithium can potentially be discovered going forward in other parts of the world, including India. However, given the immense demand for lithium, not just in cars but also for the billions of devices that use lithium-Ion batteries, without significant new mining operations, a lithium-crunch will be upon us sooner rather than later. And this is without factoring in the elephant in the room, China whose companies control much of the global lithium supply. The largest lithium ore mines in the world in Western Australia are controlled by Chinese companies. Chinese firms have also made inroads into the Atacama Desert for lithium extraction.
However, it is in the Congo, where the most problematic aspect of Lithium-NMC batteries lie—the extraction of cobalt. Chinese firms have made deep inroads into the cobalt mining industry in the Congo, and this is in addition to a significant ‘cottage’ industry of mining cobalt that takes place in one of the poorest regions in the world with little or no monitoring of safety let alone human rights. Cobalt is the dirty issue that the global automotive industry and even celebrity teenage environmentalists deliberately choose to ignore.
However, India which wants to rush headlong into electric vehicles and give up its dependance on importing billions of dollars of crude oil would do well to notice how China is mopping up the lithium supply chain extremely efficiently. In addition to mopping up resources, China refines much of the lithium inside their borders and while ‘battery packs’ are often produced at large ‘gigafactories’—to use the term coined by Tesla’s Elon Musk—the cells are produced in China. Chinese firms, especially CATL and BYD have accelerated their development of intellectual property in the battery space.
So much so, that the alternative lithium-battery technology, known as Lithium Ferro-Phosphate (LFP) is being championed by BYD. In fact, it has been confirmed by Autocar India that the TDSG factory in Gujarat, a joint-venture between Japanese firms Panasonic, Toshiba, Denso, Suzuki, and Toyota to manufacture battery packs for Maruti-Suzuki and Toyota electric vehicles for India and export will use BYD ‘Blade’ cells that use LFP battery chemistry. LFP has several material advantages over Li-NMC, primarily not requiring expensive nickel or questionable (and expensive) cobalt, making them between 10-20 percent cheaper than Li-NMC. However, LFP cells are heavier, hold around 10-15 percent less energy per kilogram of weight, and operates at a lower voltage output. LFP cells also have a unique problem that users of first- and second-generation mobile devices will remember, that is, battery memory where the cell, rather the chemical ‘lattice’ structure between lithium atoms ‘retains’ the memory of charge states and rates. However, this can be considerably solved by good battery management software.
India which wants to rush headlong into electric vehicles and give up its dependance on importing billions of dollars of crude oil would do well to notice how China is mopping up the lithium supply chain extremely efficiently.
LFP batteries also have another major advantage over Li-NMC batteries that is that they are more thermally-stable. Thermal runaway is a major issue with lithium-batteries and has led to countless battery fires across the world, and despite high degrees of automation in cell manufacturing and battery assembly, this has been an ongoing problem. Multiple cases of electric two-wheeler fires in India in the recent past bear witness to that. These issues can be resolved by better battery management software, particularly thermal management but a major challenge will be to produce a large cadre of chemical engineers in the country.
India will be one of the largest markets in the world for battery-powered vehicles, but has failed miserably at either acquiring the material resources required for this transition across the world or significantly prospecting for it. For example, the closure of the Sterlite Copper plant in Tamil Nadu due to misguided protests has led India to become a net importer of copper. Indeed, more than lithium or nickel, the largest metal component required in the battery, drive system of electric cars is copper. The battery packs found on 75-90 kilowatt-hour battery cars such as the Audi eTron or BMW iX might have only 10 kilograms of lithium and another 5-10 kilograms of nickel but up to 40 kilograms of copper. Mining in India is hampered by environmental concerns and rent-seekers. This is a policy that desperately needs to change, India should not transition from being dependent on Arabian petro-states to being dependent on China to power its transition to green mobility.
Without sufficient resources of any of the metals required in Li-NMC batteries, India should encourage its automotive industry to explore LFP systems more aggressively. This will have the added benefit of being more environmentally sustainable as well. There is little doubt that the energy density and weight advantages of Li-NMC batteries will remain, which is why their continued use in very high-end automotive applications where weight and power are critical such as performance cars and motorcycles will likely continue. Weight being critical in two-wheeler applications, there could also be Li-NMC use in ‘high-power’ commuter electric two-wheelers. But as the spate of thermal runaway incidents has proven, India might need to take a relook at which types of electric two-wheelers it promotes. Promotion of smaller ‘medium’ power and range electric two-wheelers would be more appropriate for India from both a cost and usage perspective.
India will be one of the largest markets in the world for battery-powered vehicles, but has failed miserably at either acquiring the material resources required for this transition across the world or significantly prospecting for it.
However, the positive moves being made by Suzuki and Toyota with regards to using LFP battery systems on their upcoming vehicles should be applauded, and when the country’s largest carmaker goes down this route, others will likely follow. If indeed, LFP becomes the dominant technology used in electric vehicles in India, we would also need an urgent mineral survey to see whether India has commercially-viable lithium resources. India’s automotive sales peak pre-COVID stood at around 3 million passenger cars, and this is expected to touch 5 million passenger cars by the end of 2030, even if 30 percent of all passenger cars sold by 2030 are electric (possibly more), India will need, just for passenger cars alone over 15MT of refined lithium. Add in two-wheelers and commercial vehicles, and requirements could exceed 25MT of refined lithium. Indian companies looking to explore cell manufacturing should explore global opportunities to secure lithium resources just for India’s immediate needs alone.
There is, however, an interesting hope, even though it is being developed, surprise, surprise, in China by the world’s largest battery-cell manufacturer CATL. That is sodium-ion batteries. While doctors might advise humans to consume less sodium (Na), this element might prove to be India’s biggest savior when it comes to battery technology. The country’s largest industrial conglomerate Reliance Industries has invested in buying a British technology firm Faradion that is developing their sodium-ion technology. Of course, a cursory understanding of the periodic table will show that sodium is a lot heavier than lithium.
The amount of sodium by weight in a sodium-ion battery system is three times as much as the amount of lithium, so in a vehicle like the Tesla Model 3 or a BMW iX this will mean instead of 10kgs of lithium, one will have 30kgs of sodium. However, sodium-ion technology has a lot of runway to develop and the crucial aspect of sodium itself and sodium-ion batteries on the whole is a very simple fact, sodium-ion technology will not leave countries like India materially dependent on a few nations that control critical minerals and resources, after all seawater provides an almost inexhaustible source of sodium, although most like sodium used in batteries will come from soda ash.
The country’s largest industrial conglomerate Reliance Industries has invested in buying a British technology firm Faradion that is developing their sodium-ion technology. Of course, a cursory understanding of the periodic table will show that sodium is a lot heavier than lithium.
Now, sodium’s drawbacks are not just around weight. A major concern with sodium-ion technology is that it stores almost 30 percent less energy per kilogram than standard lithium-ion batteries today, around 160Wh/kg compared to in excess of 220Wh/kg for standard lithium-ion batteries and almost 250Wh/kg for top-line lithium-batteries, although heavy energy density has a degree of correlation to thermal runaway. Another major drawback is the lower voltages that Na-ion batteries have compared to Li-NMC, but improvements are being made that should help, Na-ion batteries reach voltage charge and discharge rates equal to those of LFP cells that will even allow for a 15-minute quick (80 percent) charge. However, according to research papers and patents filed by Chinese firm CATL, developments of 180Wh/kg Sodium-Ion batteries are around the corner in the second-generation of such batteries. These developments are so positive that Elon Musk has stated publicly that standard range and performance Tesla vehicles will switch to Na-ion batteries in 2023. A vote by the world’s leading EV maker is a great boost for the technology.
But Na-ion batteries will have major materials benefit beyond just the easy availability of sodium. Simpler electrolytes, particularly a material called Prussian White, made from Prussian Blue, a ferrocyanide is not only easily produced, it is far less toxic than the electrolytic parts of Li-ion cells. Sodium’s much lower reactivity and toxicity will also allow the use of aluminium in cell parts and the battery pack, the cathodes can also be made from engineered carbon, and developments in materials science should be able to drive costs down further and reduce the weight disadvantage of Na-ion over Li-ion, although for the first few generations, lithium batteries weight advantage may not be overcome.
It must also be remembered that sodium-ion batteries, while showing immense promise, are still not commercially deployed. But an investment by Reliance Industries in Faradion, a British developer of Na-ion cell technology shows that even Indian companies are taking notice of the technology. It is clearly not vaporware like thorium nuclear reactors, but show could be a pathway to a sustainable electrically-driven future that it would make sense for the Indian polity and industrial establishment to invest in creating scientific and technical knowhow as well as industrial capacity in, if developments keep up at this rapid pace.
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Kushan Mitra is a journalist with over two decades experience covering the global automotive mobility and transportation industries extensively.
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