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Jun 11, 2023

Why EV battery makers are so hungry for clean energy

Searching for the right place for his battery materials factory, Eric Stopka looked at 15 states. Most of the sites didn’t meet his essential needs. Some of those needs are common to any manufacturer

Searching for the right place for his battery materials factory, Eric Stopka looked at 15 states. Most of the sites didn’t meet his essential needs. Some of those needs are common to any manufacturer — good transportation, available workers — but the others sat in a new, 21-century kind of bucket.

“Three of the five most important were power-related,” said Stopka, the president of Anovion Technologies.

First, the plant needed a vast amount of electricity. Second, that juice needed to be ramped up fast. And third, in a development that foretells the future of America’s battery industry, it had to be clean.

“I don’t want to be the guy or the company that’s dragging down the company that’s going for net zero,” Stopka said.

Anovion’s search points to a little-known reality for the new electric vehicle battery supply chain. As the factories come online, they will have a voracious hunger for electricity — and not just any kind, but the renewable and zero-carbon electricity that other industries are also starting to covet.

The trend is so new that it hasn’t yet worked its way into official or academic projections of energy use. It raises questions about where the power will come from to support a new generation of battery factories for electric vehicles, and points to a new industrial race to grab the fruits of wind, solar, nuclear and hydropower plants.

Members of the new battery supply chain anticipate that they will be under pressure from their downstream customers, especially automakers, to make their products more immaculately than industries of the past.

That’s because they are being born in a new era. As governments get serious about reining in climate change, emissions from manufacturing face hard-core scrutiny. Europe’s regulators just passed new rules to track the energy footprint of battery materials all the way back to the mine. The U.S. Securities and Exchange Commission is drafting requirements for public companies to report their carbon emissions. And the supply chain of electric vehicles is especially in the spotlight because of the auto industry’s outsize role in the economy and the EV’s importance as an emissions-fighting tool.

The trend is clear: The battery supply chain needs to run on clean power, even if the actual requirement to do so lies sometime in the future.

“Ten years from today, 20 years from today, we want to be in a different world,” said Venkat Srinivasan, a chemical engineer at Argonne National Laboratory and the director of the Argonne Collaborative Center for Energy Storage Science.

“So we need to ask ourselves, ‘Where is the energy coming from to make the battery?'” he continued. “If we’re all going toward this clean energy future, and batteries are the linchpin that gets everybody there, we need to make sure that linchpin is using clean energy.”

Executives of battery supply chain companies who are building factories across the country said in interviews that the cleanliness of electricity is top of mind. Collectively, Stopka thinks this new battery and vehicle supply chain will “transcend any growth we’ve seen in the U.S. in the last 150 years.”

In fact, the search for zero-carbon electricity is starting to act as an invisible hand that guides where factories get built — along with decades’ worth of jobs and economic growth — and where they don’t.

And companies want far more electricity than they can find.

“Although the U.S. has abundant, inexpensive land available for industrial development, sites that are truly shovel‑ready for projects with large electricity demands are in surprisingly short supply,” a battery industry consortium called Li-Bridge said in a report earlier this year. Many, it added, “need sites that have access to large amounts of clean, reliable energy.”

The push comes at a time when it’s difficult to shift clean energy from its source to new centers of demand. Big wind and solar energy projects are constrained by a lack of transmission and clogged grid interconnection queues.

What is clear is that battery manufacturing is an energy hog. While there are limited statistics on the industry’s power use as a whole, preliminary studies signal it could rival other big industrial and commercial power users, like chemical plants or data centers.

Making 1 kilowatt-hour of battery — the basic unit that determines a vehicle’s range — requires an input of 47 kWh of energy, according to estimates in a study by Argonne National Laboratory.

Seven years ago, Argonne researchers visited battery plants in China and examined their energy use. Those plants used mostly natural gas, which makes the study’s results only partially relevant to today’s American battery plants that seek to run mostly or entirely on electricity.

Consider what happens if the study’s results are applied to the battery in Ford Motor Co.’s signature electric truck, the F-150 Lightning, which in its largest format has a battery of 131 kWh. Using Argonne’s estimates, synthesizing one such battery would use more than 6 megawatts of energy. If all of it were provided by electricity, that would be enough to power the average American home for more than seven months.

“It requires some juice,” said Celina Mikolajczak, a manufacturing veteran and chief battery technology officer at Lyten, a California maker of lithium-sulfur batteries.

The process that Anovion uses to make its product is a window into the battery industry’s energy needs.

Anovion’s offering is synthetic graphite. Graphite is one of the most voluminous ingredients of a lithium-ion battery. The company got a $117 million grant last fall from the Department of Energy with funding from the 2021 bipartisan infrastructure law. Graphite production is overwhelmingly controlled by China, and making it domestically might ease fears that its availability could vanish in a time of U.S.-China tensions.

Anovion’s technique starts with a petroleum waste material called needle coke. It is “the last 15 percent of the barrel,” as Stopka puts it.

The goo is poured into crucibles, or thick canisters a meter or two long made of metal and ceramic materials. Then a monster electric current assaults them, heating the petroleum to more than 5,400 degrees Fahrenheit, half the temperature of the surface of the sun. This roast goes on for nearly a month.

When the crucibles clank open, what remains is synthetic graphite, a gray substance with the consistency of baking powder that is ready to be integrated into an EV’s battery.

Anovion is an extreme example of what makes battery manufacturing such an energy gobbler: temperature.

Downstream of products like Anovion’s is where the traditional battery-making process actually starts. Powders are mixed and liquid is added, turning them into a semi-liquid state known as a slurry. That slurry is then pasted onto metal sheets.

A small part of the energy use in battery manufacturing is the machines that mix, roll and flatten this material.

But their electricity use is nothing compared with other key machines: ovens and air conditioners.

Ovens are essential in turning the slurry into a solid that can withstand the rigors of operating for years in an electric car. The heat removes the slurry’s water and chemicals. Almost 47 percent of the energy needed to make a battery cell comes from this drying or recovery of the solvent, “due to the long-time heating and off-gas cooling,” according to a 2021 study by Worcester Polytechnic Institute and A123 Systems LLC.

Even then, the drying is not done.

Some battery materials, particularly nickel, are “irreversibly changed by exposure to moisture,” Mikolajczak said. This means that for some more finicky materials, the entire battery assembly shop must be enclosed behind plastic sheets in a vast dry room, where air conditioners work constantly to suck moisture from the air and keep the humidity low.

The Worcester Polytechnic study said that another 29 percent of battery manufacturing’s energy use is from those air conditioners. In total, more than three-quarters of a battery’s energy use is controlling temperature.

That heating produces huge energy bills and contributes substantially to the battery’s finished cost.

“Temperature is money,” said Srinivasan, the researcher at Argonne.

The energy requirements are why automakers are seeking out a little-noticed holy grail known as “dry cell” technology. As the name implies, it involves fabricating the battery electrode without use of a slurry, which could slash the energy use of battery making nearly in half.

Tesla Inc. considers dry cells a key to continuing its dominance in EVs. The technology was a key target when Tesla acquired a company called Maxwell Technologies in 2019. A year later, the company cited dry-cell tech as one of the key innovations for its new 4680 battery cell, which is intended to reduce the energy and footprint of making battery cells tenfold.

“Dry electrode is a key piece (one of many pieces) of the puzzle for lowering cost of lithium batteries.” Musk tweeted in 2021 — though it isn’t easy. “It has required an *immense* amount of engineering to take Maxwell’s proof-of-concept to high-quality, volume production & we’re still not quite done,” Musk continued.

Tesla did not reply to a query about its current plans to deploy dry cells.

Tesla is not alone: Last month, Volkswagen AG said it is getting ready to scale up a dry-cell technology, which the company said could save hundreds of millions of euros a year.

In the United States, battery makers don’t have to use renewables or carbon-free power. So why do they feel such an urgency to get that electricity without adding greenhouse gases to the atmosphere?

One answer, battery makers said, is that they share the same ethic as electric vehicle makers like Tesla, whose intent is to make tailpipes obsolete. But when ramping up a new industry in an era when governments are intent on lowering greenhouse gases, it also is good business.

“Over time, there will be limits set on the CO2 footprint per kilowatt-hour of production of a battery,” said Gene Berdichevsky, the co-founder and CEO of Sila Nanotechnologies, which is building a battery materials factory in Washington state.

“If you’re a carmaker and need to stay below a certain cap, and if you’re over that limit, you’re willing to pay more for a product that gets you under that limit,” he said.

Sila feels that keenly because one of its principal investors and customers is Mercedes-Benz AG, the German automaker. Recent regulations adopted in the European Union vow to rigorously track the carbon footprint of the batteries used in Europe’s EVs.

To make its product, a silicon-based anode powder, Sila is “essentially cooking our materials” in electric furnaces, Berdichevsky said. Anticipating how regulations on another continent would regard this electricity usage, Sila built its factory on a power grid in eastern Washington that has abundant hydropower, which has a low carbon footprint.

This kind of thinking is pervasive in the young battery industry, said Mikolajczak, the battery expert at Lyten, because “energy” and “carbon” are synonyms when contemplating a zero-carbon world.

“Any executive is looking at the carbon footprint of their factory,” she said. “You’re going to expect your factory to run for 30 years, and you have to supply energy to it for 30 years. Otherwise, you’re not being cost-effective and you’re losing money.”

These twin energy requirements — voluminous and clean — are driving battery startups’ conversations with electric utilities and are sometimes even swaying where a factory gets built.

Aqua Metals Inc. is a battery recycler whose big idea is to recover high-purity critical minerals from spent batteries. Old batteries are chopped up into a material called black mass that “looks like black sand,” said Steve Cotton, the company’s president. The mass is immersed in a proprietary liquid and an electric current is applied to it until the desired metals deposit themselves on a metal sheet, a process known as electroplating.

At its pilot plant in Reno, Nev., Aqua Metals intends to soak 3,000 metric tons a year of black mass and produce $60 million worth of critical minerals, including cobalt, manganese dioxide, lithium hydroxide, nickel and copper.

Electroplating, not surprisingly, uses a lot of electricity. Cotton said “tens of megawatts,” giving the plant an energy footprint similar to that of a data center, one of the most electricity-intensive types of businesses there is.

The power will come from NV Energy, the state’s principal utility, which has promised the company 40 percent renewable power. The remaining 60 percent, Cotton said, will come from renewable energy certificates — a sort of voucher for clean energy produced elsewhere that is often criticized as a half-baked solution.

“Today that’s cool, but at the end of the decade, you’re not going to be able to say you’re net zero unless you can say every electron comes from a clean source,” Cotton said. “That’s why our plant is going to have massive solar” — probably about a megawatt spread across roofs and parking canopies on a 5-acre campus, he said.

The factor of electricity — both supplying it and saving it — also figured into the siting choice of Amprius Technologies Inc., a California battery cell maker. In March, it announced a new 1.3 million-square-foot factory outside Denver, located in a giant building that used to be a distribution warehouse for Costco Wholesale Corp.

Denver’s low humidity will lower energy bills, said Kang Sun, Amprius’ CEO. “With the 300 days of sunlight they have,” he added, “we can take advantage of solar energy and wind energy.”

For Anovion, encountering the right spot for a factory first involved rejecting a site whose grid wasn’t clean enough because it was largely fired by fossil fuels.

“Even the 10-year plan wasn’t in a range we were comfortable with,” Stopka said. In May, the company settled on Bainbridge, a town of fewer than 15,000 in the southwest corner of Georgia.

The site had attributes that appealed to Anovion. The factory can build a turnout on the local train line and ship by barge on the nearby Flint River. To get its 400 employees, it is in talks with the local technical college.

Stopka said a big draw is that a big utility, Georgia Power, has promised to deliver more zero-carbon energy over time. The state has two big nuclear power plants, and in a plan approved by regulators last year, Georgia Power committed to adding 2,300 MW of renewables by 2025.

Anovion is one of dozens of EV-related companies flocking to the southeastern U.S., where they have been aggressively courted by local officials and where a cultural aversion to labor unions may trim employment costs.

“People don’t think of this part of the country as clean energy,” Stopka said. “We were pleasantly surprised.”

Like other battery companies, Anovion is in a hurry.

The company won’t say how much energy it needs, but Stopka said the site will require a new substation and transformers. Once those are built, the process of zapping petroleum waste into EV battery materials will begin at scale. Sites that lost out on the first round may be revisited, since Anovion has plans to build a second large factory, and then a third.

“Utilities that were willing to start and move along quickly had a higher score with us,” he said. “When you break ground is when the clock starts ticking.”