Where’s the ABC: Adaptation of Battery industry to Climate Change?
We talk a lot about climate change and the impact batteries will have on mitigating our carbon emissions. However, something we don’t see discussed nearly enough is impact climate change will have on the battery industry and what it could do to our capability to manufacture crucial energy storage. This final piece from Issy in her mini-series flips the perspective and asks, what does climate change mean for battery supply?
Batteries are one of our biggest tools in the fights against climate change. They are a key mitigation strategy, allowing us to have electric vehicles and grid resilience without burning fossil fuels. However, to allow us to keep manufacturing batteries in a fast changing world, the industry needs to face up and take on the mindset of climate adaptation, and prepare for resilience over the coming decades.
We have the solutions to human caused climate change: to stop burning fossil fuels and restore nature. However, even if we did this tomorrow, at a constant 420ppm (parts per million) of carbon dioxide in the atmosphere the world would continue to warm approximately 0.4-0.5°C over the next century due to ‘locked in’ warming as global systems equilibriate to this concentration of carbon dioxide.
This means that the coming decades will be defined by much more extreme weather, extreme heat and sea level rise. We need to get serious about what this means or face the consequences of being ill prepared.
For those in the business of putting metal tubes (or planes) several kilometres into the atmosphere, this is a huge concern. The aviation industry is certainly thinking about how to minimise its own risks, since it is widely reported that climate change will make flying more dangerous. The industry is responding to the forecasts with the adaptation of both its planes and ground infrastructure.
They’re worried about:
higher average and extreme temperatures;
changing precipitation patterns;
changes to storm patterns;
sea-level rise and storm surges;
changing wind patterns.
All of which will also affect the battery industry. A lot of the inter-dependencies from other industries and possible knock-on effects of extreme weather are also not understood enough to be predicted in advance. The UK Climate Change Committee highlighted in 2023 that the UK is not adequately prepared for climate change. The sooner we start talking, thinking and planning for this, the better.
The need for supply chain resilience - the case of water stress
The global lithium ion battery supply relies on a collection of critical minerals, including lithium, cobalt, nickel and phosphate rock. Something that is already starting to bite in mining areas is water stress, since mining is a very water-hungry process. From a report from McKinsey in 2020:
In Chile, 80 percent of copper production is already located in extremely high water-stressed and arid areas; by 2040, it will be 100 percent.
The below maps shows the areas of water stress, and the EU’s import dependence on areas for different minerals. The key overlaps of concern are Chile, key exporter of lithium, Mexico, key exporter of fluorospar which is a starting material for LiPF6 electrolyte, China, source of natural graphite and also Australia, which is another key source of lithium.
Water stress adds to tensions with local and indigenous communities, particularly over rights to use the water. This is already becoming an issue in Chile, causing farms to run dry and raising questions in government over the future of the mining there.
The ‘lithium triangle’ in South America sits squarely in the South American water stress rectangle. Similarly, most of Australia’s lithium deposits sit within the water stress square on the west of Australia, map shown below.
The three largest areas of deposits of lithium are therefore mostly within areas of high water stress.
As climate change worsens, these tensions are expected to multiply, and having a diverse and reliable supply chain, as well as diverse technologies, will be key to be able to keep producing batteries. If we over-rely on certain regions that we can already predict will have water stress, the likelihood is we will not be able to make as many batteries as we had hoped, purely because we may be unable to mine lithium.
This could also have knock on effects on geopolitics of the area if water stress falls particularly heavily on certain communities or activities, which will complicate trade and could affect multiple other parts of the economy.
Mining and supply chains also need to worry about lower productivity due to extreme heat and flooding damage of infrastructure due to climate change and its consequences. Extreme heat is of particular concern, not just for the effect on the health of individuals, but also in the ability to effectively run plant machinery during high temperatures. The Harvard Business Review advocates for in depth mapping of supply chain to identify weaknesses in order to make them climate-resilient.
Transport of battery bits
Warmer oceans and higher sea levels have greater intensity of hurricanes and tropical storms. The proportion of the most severe and destructive cyclones has grown by about 5% since 1979.
Drought and low water levels can also seriously disrupt cargo shipping. This UK Climate Change Committee report cites several examples from summer 2022 in Europe, China and the US where record low river levels disrupted factory and agricultural production, forced cargo ships to carry smaller loads and risked power blackouts for millions of people.
Just one extreme weather event impacting cargo could severely hinder battery production, which in a low profit margin business could be extremely detrimental to business survival.
Finding a site to build a giga-factory is a tricky business. They require excellent connectivity - road, rail and ports - as well as large energy provisions and water. However, because they also require things like dry rooms, a flood could be absolutely catastrophic to a battery factory.
In 2023, Slovenian car part manufacturing facilities suffered approximately $10 million of damage due to floods, which had knock on implications for car plants all across Europe for about a month. The disaster was reported as the ‘worst-ever’ floods in the country.
The UK Climate Change Risk Assessment from 2022 points out that a small change in the average climate can drive unprecedented weather events, so what used to be a 1-in-100-year flood event can become a 1-in-10-year event. There is also huge uncertainty in sea level rise expected, with scenarios modelled ranging from 28cm to 101cm+ of rise by 2100.
This discussion makes siting factories even more complicated. One site being considered in the UK for a battery plant with estimated building costs in billions is mostly situated in a flood zone 3 (land with a 1 in 100 or greater annual probability of fluvial flooding or with a 1 in 200 or greater annual probability of tidal flooding). While site modelling deems it unlikely to be flooded by any tidal events, the site is predominantly prone to surface water (or flash) flooding where rainwater cannot drain away through the normal drainage systems, and several scenarios show parts of the site prone to flooding in current 1 in 200 year scenarios. Whilst this sounds unlikely, in the context of climate breakdown making the weather more extreme and unpredictable, 1 in 200 could become much, much more frequent. DOes anyone know what happens if a dry room gets flooded?
Land use around factories also defines how at risk it is to flash flooding: urban areas with impermeable surfaces increases that risk. Even how the farmland is managed over winter and whether roots are left in the soil contributes to how susceptible it may be to flooding. A factory can no longer be seen in isolation from its surroundings or the natural environment.
The question remains, should we be building important and sensitive infrastructure in low lying areas whilst the sea is rising? Higher areas are by no means necessarily immune from flooding, but building factories on flood plains will force governments to make decisions on what to protect: manufacturing industries or highly densely populated areas. The water has to go somewhere.
Intercalating adaptation into our mitigation focused approach
Change is coming, the question remains how we integrate planning for extreme weather and increasingly unpredictable world that we live in. In order to keep being able to build batteries to mitigate against climate change and stop burning fossil fuels, we need to think about how to build the most resilient industry possible. This applies on every level, from supply chain and building factories right down to how to host conferences, when traditional locations may become wildfire hotspots and it may not be safe, or sustainable, to travel regularly.
We must minimise risks where possible, diversify and map supply chain dependencies and most importantly, get serious about building a resilient industry. If we do not adapt, how will we mitigate?
🌞 Thanks for reading!
📧 For tips, feedback, or inquiries - reach out