To accelerate the energy transition we need to make less batteries

A few weeks ago, Alex Grant announced a funding round of $10M for his new company Magrathea. They are developing a new generation of electrolytic technology for the production of magnesium metal from seawater and brines. Magnesium is a structural metal which is 33% lighter than aluminium and four times lighter than steel. With Magrathea’s technology the metal can also be carbon neutral, meaning not least that the embodied emissions of our future vehicles can go down.

One interesting reaction among people who know Alex was how crazy they found it was that he and his co-founder Jacob could leave the hot areas of lithium and batteries. After all, Alex’s handle on Twitter with over 6,000 followers is @big_lithium and despite his youth he has an impressive career within the lithium industry already. His co-founder Jacob Brown built the cathode pilot at Tesla for their cell program. How could anyone with those credentials leave one of the most important industries in the world when it just really got started?

Maybe it’s because Alex, Jacob and the rest of the Magrathea team have come to see the bigger picture. That the key to a successful energy transition is not necessarily how we fastest increase production of more materials but instead how we can do it while using less.

By eliminating deadweight from electric vehicles we can have the same range with fewer batteries. Being in a decade of a battery supply chain crunch one might think that this would be a top priority. Still this side of the density equation receives considerably less attention then the race to make the batteries themselves more energy dense.

Of course it’s great if a battery can store more energy with less weight. But actually, whether that weight gain sits in the actual battery cell or in the body of the car doesn't really matter. It’s the same kilograms and pounds. That was exactly what the Chinese battery makers BYD and CATL realised when they tackled a new subsidy structure in China which mandated higher energy density on pack level by, instead of improving the cell, eliminating the module. They placed the cells directly in the packs. Same effect, just another solution. But the pack became more efficient and is now rapidly becoming the industry standard.

Today it’s almost impossible to open up a business publication without reading about new battery gigafactories. The key word is “scale”. The currency is gigawatt hours. Similarly there is a strong focus on recycling and there is a widely spread perception that recycled materials soon can be used to make a significant share of the batteries we need to replace our current fleet of vehicles with internal combustion engines. Besides this, the western countries share an articulated ambition to accelerate both of these developments while also becoming less dependant on China.

What is very briefly discussed is whether these two strategies, massive scale-up of local battery plants and the use of recycled materials, really are realistic paths to independence or even the fastest way to an energy transition at all.

In Circular Energy Storage's latest assessment of battery production the market share for China-made batteries was 79.9%. The combined market share for CATL and BYD was 49.6%. The 7 largest players in the world, all from Asia, produced 79.6% of all batteries last year. In any other industry that kind of strong market leadership would be considered almost impossible to challenge. But in today’s Europe and North America it can be brushed off as marginal detail.?That some new European or American companies haven’t produced a single battery is not concidered especially important and?it’s totally normal for anyone to label the companies “leading”. That the US government see itself forced to subsidise US-made batteries with $45/kWh, almost 15 years after the first EVs rolled off the production lines, is seen as an opportunity.

At the same time China is currently exporting almost as many EVs as the US place on the market and still produce batteries to a significant share of the EVs produced in both Europe and the US. Batteries produced at a lower cost and at higher pace. Exactly the parameters that once moved production away from the West in the first place.

Another number from Circular Energy Storage’s research is that the amount of materials from EV batteries that are available for recycling in the US will be only 2% of what is needed to make new batteries in 2030. In Europe it will be 1.4%. This can also clearly be seen in a recently published paper relying on Circular Energy Storage's data.

What's also important is that batteries made from recycled materials will basically only enable the replacement of the EVs that already was in the market as drivers of electric vehicles tend to continue to drive electric. In fact the materials in an old battery pack will many times be sufficient for only half of the new battery as pack sizes in several markets have more than doubled the last ten years.

In other words, if the energy transition will mainly be about building out western battery production which will rely on recycled materials, while the dependance on China should decrease, there is a high risk of failure or at least that the transition will take a very long time.

Of course we need a massive scale up of battery production. That is true in China and in the West. But to really enable that we also really need a significant increase of investments in mining and downstream material production. This also provides the necessary conditions for effective recycling.

But in fact the only way to accelerate the use of recycled materials in the batteries is to make less batteries. Which also make the West less dependant on China.

Enter Magrathea! The combination of scaling up a technology that can produce metal, that is available in sea water, in a carbon neutral way to produce light weight structures should be looked as a key to decarbonisation as much as anything related to batteries. There are hundreds to thousands of kilograms of structural metal like steel and aluminium in electric vehicles while there are only tens of kilograms of lithium, nickel, and other critical battery materials. Structural metal is a huge part of electric vehicles that has historically not recieved near as much scrutiny or attention for improvement as batteries themselves have. This should change.?We must learn to see the bigger picture and rely more on data than just sheer enthusiasm.

In a similar way there are innovations which alongside both lightweight metals and improved energy density in batteries could limit our need for materials. On the battery side the use of more abundant materials like sodium will help to ease a future lithium supply crunch (lower density but without lithium). Fast-charging batteries, ubiquitous charging infrastructure or in-road charging will help to slow down a development where batteries only become bigger. We recently wrote about the benefits of battery swapping which also can be a key enabler, not least for heavy vehicles. Smaller vehicles would also be helpful, just like a transition to two-wheelers and public transport.

The irony is that China is in the lead in most of these solutions as well. But at least these areas don’t require the same complex supply chains as the batteries themselves do.

If we really are serious in our efforts of building up a completely new industry in which we are not in the lead while we are racing to becoming carbon neutral, we need to think different. We need to be smarter and we need to embrace the concept of less instead of more. And we need look beyond batteries to make really batteries successful.