Nov & Dec 2023 Roundup ❄️
It’s getting real cold. Here’s our last monthly roundup of the year. ❄️
💰 Money for the US and UK governments
A few weeks ago, the DoE posted a notice citing intentions to provide an additional $3.5B to expand domestic manufacturing of batteries for EVs, the grid, and upstream raw materials with the goal of “Enhancing national security by reducing the reliance of the United States on critical minerals, battery materials, components, and technologies from foreign entities of concern”. The funding was confirmed and announced this November to support all sorts of facilities working on battery-grade processed critical minerals, battery precursor materials, battery components, and cell and pack manufacturing.
Across the pond, the UK government announced £4.5B for British manufacturing which includes automotive and zero emission aircraft. This closely follows the publication of the UK Battery Strategy. We’ll overlook the weird timing choice of publishing on a Sunday, since it celebrates key commitments for the UK from JLR, Nissan, Bentley, BMW and Stellantis, and lays out the challenge coherently. Over £2B will go to the automotive sector. It’s nice to see the expected shortfall in critical minerals getting some time in the limelight, as well as the need for a continuous talent pipeline for manufacturing. Some concrete plans in the battery space include: £38M for UK Battery Industrialisation Centre, £12M in the Advanced Materials Battery Industrialisation Centre, £11M in 20 competition winners across the battery value chain (TBH these all sound very small and nowhere nearly enough…).
🏭 CATL is setting up shop in Hong Kong
CATL, the global leader in electric vehicle battery manufacturing, is investing over HK$1 billion ($128M USD) to establish its new HQ and R&D center in my hometown Hong Kong. This move is a big deal and Hong Kong hasn’t really been on the map for any battery activity until now. It’ll be based in the Hong Kong Science Park and host about 500 jobs. Hong Kong’s position as an international financial hub offers CATL access to international markets and global footprint.
🏭 Toyota is getting busy
Toyota is putting $8B more into the North Carolina facility and will be producing batteries by 2025 and up to 30GWh capacity by 2030. In addition, they’re expanding sourcing and recycling of cathode materials and copper foil domestically with Redwood Materials. This is strategically significant - Toyota is not only reducing its environmental footprint but also mitigating international supply chain dependencies.
They’re also continuing to invest in the far future as a long-time supporter in solid-state batteries, but also coming to face reality and acknowledge challenges and the scaled-back production expectations, as they realize they’re able to produce a lot less solid-state batteries than they thought (2030 onwards).
🛢️ Exxon re-enters the scene
Exxon, one of the OG inventors of the lithium ion battery with Nobel Prize winner Stan Whittingham, is now re-entering the scene with lithium extraction. They say they will translate their expertise in mining and chemical processing to lithium and will start drilling in Arkansas.
Exxon's entry could signal a shift in the energy industry. However, oil is pretty different to lithium brines, and will be watched closely. It also raises questions about the role of traditional fossil fuel giants in the energy transition. Exxon's move towards lithium can be seen as a bid to avoid irrelevance in an increasingly renewable-focused world.
Exxon also has a checkered past, characterized by significant environmental impacts, oil spills and a history of contributing to climate change. They’ve known about the catastrophic impacts of climate change since the 1970s and consistently downplayed the risks and spread climate denial in order to keep selling fossil fuels. The clean energy domain demands high ESG standards and there are real concerns about whether Exxon will stick to the stringent requirements in sustainable resource extraction. The company's approach to lithium mining will be under intense scrutiny, especially in terms of environmental stewardship and ethical practices.
Check out ExxonKnews on Substack to read more about fossil fuel companies and climate.
🏎 Controlling your speed
A National Transportation Safety Board (NTSB) piece came out calling for “speed assistance technology” in new cars i.e. “Active systems include mechanisms that make it more difficult, but not impossible, to increase the speed of a vehicle above the posted speed limit and those that electronically limit the speed of the vehicle to fully prevent drivers from exceeding the speed limit.” The board claims it controlling speeds can save up to 12,000 lives per year. This was met with criticism that this was a way of stealing people’s freedom. However, we already do this with hire e-scooters and bikes such as Lime using geofencing1. @DriveBikeWalk did some nice analysis.
From a battery perspective, maintaining a controlled and predictable speed in cars helps find the sweet spot for optimal battery performance. A battery (and a battery management system) thrives on consistency and predictability. When a car cruises at a steady pace, it alleviates stresses on the battery, avoiding the highest peaks and lowest valleys in a drive cycle and can minimize the wear and tear associated with the rapid discharge and recharge cycles that mostly during erratic driving.
🧂 Keep your i-on sodium ion
As an upcoming competitor to LFP, large gigafactories are starting to put more time and capital into Na-ion. These moves signal a growing interest in Na-ion batteries as a viable alternative, in the context of diversifying energy storage solutions and addressing raw material scarcity issues.
China-based BYD signed a $1.4B contract to build a 30 GWh Na-ion battery gigafactory (biggest in the world so far). Northvolt also came out with an announcement on their sodium-ion prototype with licensed tech from Altris last month in their R&D facilities in Västerås, Norway.
🚀 More trends in LFP
📉 Bloomberg published their annual battery pack price survey and prices are now back to following the overall falling trend after a slight increase last year. “Average pack prices reached a new record-low of $139/kWh, a 14% decline from last year”, largely due to a fall in many raw materials prices. Prices will continue to drop so long as batteries keep getting produced2.
We’re starting to see a trend. With all these falling prices, it’s become increasingly tricky to build new cells and factories to compete and catchup with cells that work and are already being made in factories i.e. LFP. Freyr recently paused their work in Norway (which licensed novel electrode tech from 24M) and now channeling more energy into their plant in Georgia working on LFP. EnergyVault recently pivoted away from their gravity stationary storage system to LFP. Our Next Energy has a Gemini anode-free cell in their demos, but their production is solely focused on LFP for now.
🚀 Large ships boats with battery swapping
🚢 Electric ships are becoming more of a thing in China, including battery swapping. Specs include 50 MWh battery, 36 swappable battery packs, 10 mins swap per pack, 600+ miles.
This is pretty cool, and China seems to be learning a lot from the battery swapping side of things. Nio and Geely recently announced they’re working together on more battery swapping developments too. Advantages with swapping: with better monitoring and deployment of batteries depending on specific driver’s use cases, batteries will last longer. In addition, unused batteries can be used for stationary storage.
💼 Sadly, “downsizing” / “rightsizing” is coming
Battery companies are facing a significant shift, marked by a wave of layoffs and strategic rightsizing of investments. This is largely driven by an interplay of factors, including fluctuating demand, rising interest rates, and broader economic uncertainties3. Our Next Energy laid off 128 employees. LG Chem laid off 170 in Michigan. SK On laid off 100 in Georgia. Freyr laid off 78 in Norway. Ford BlueOval is rightsizing their factory from 35 to 20 GWh.
No one is safe: as The Electric’s Steve Levine puts it:
“Our Next Energy’s Mujeeb Ijaz becomes the fourth - and by far the most surprising - founding next-gen battery CEO to be kicked upstairs or out. The others are Enovix’s Harrold Rust, Solid Power’s Doug Campbell and Freyr’s Tom Einar Jensen.”
On the policy side, a significant battle is emerging in Scandinavia with Tesla suing Sweden after Musk’s anti union stance and refusal to sign contracts with the unions has escalated into solidarity strikes all the way down to Denmark. This is one stand off that could have large repercussions for workers rights in the Scandinavian block or could it be the straw that breaks the camel’s back on Tesla negotiating with unions?
⛏️ London Mines and Money Conference
We attended the Resourcing Tomorrow conference in London to see the battery industry from the other side. It was a super interesting couple of days seeing what mining exploration was thinking about, with lots of panels on ESG standards and a real focus on the talent attraction problem in mining. Some takeaways:
One panel stressed the importance of reducing reliance on certain countries without creating new dependencies. China has the ability to (1) ban imports and (2) force an oversupply which can mess up all the prices. Other mining orgs said “good luck trying to not work with China”.
One panel mentioned we have pushed Li-ion batteries far beyond what they were originally intended to do (“CD players and camcorders”), and the whole world being wedded to Li ion batteries is a “colossal failure”, and the need to push to next-generation tech ASAP.
One panel on UK mineral extraction tickled us as it finished with a question asking when we can be excited by what’s actually happening, rather than eternally looking forward to developments.
🎧 What else we’re reading and listening to
Union of Concerned Scientists: How are EV batteries actually recycled
Transport & Environment: Paving the way to cleaner nickel
Advanced Propulsion Centre: Battery Value Chain report
Margaret Slattery et al. (UC Davis): Charting the electric vehicle battery reuse and recycling network in North America
WIRED: Why Teslas Totaled in the US Are Mysteriously Reincarnated in Ukraine
🌞 Thanks for reading!
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I recently thought about the importance of pace regulation. I swim at the London Aquatic Centre where the lanes are split into different speeds: slow, medium, and fast. This system ensures that each swimmer can swim at a speed that aligns with their ability, without disrupting the flow of others. One time I sprinted in a slow lane, and the lifeguard told me off and asked me to either slow down or switch lanes. In a way, this mirrors the principles of driving on highways. Vehicles moving too slowly can be as disruptive as those speeding, each creating potentially fatal hazards in the flow of traffic.