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- Electric cars run on lithium-ion batteries, which are largely produced in factories in China.
- Two British lithium mining startups — Cornish Lithium and British Lithium — are hoping to tempt companies like Elon Musk’s Tesla to open factories in the UK.
- Such factories could boost the UK economy and ensure a steady supply of electric vehicles before a proposed ban on petrol, diesel, and hybrid cars comes into force in 2035.
- Though Britishvolt is building the first “Gigafactory,” a place where lithium-ion batteries are produced, in South Wales, experts say the UK government needs to do more to ease China’s stronghold on the lithium battery market.
- Cornish Lithium has raised nearly $3 million to explore the southwestern UK county as a potential hotspot for battery-grade lithium.
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Forget pasties and beaches: If Elon Musk goes to Cornwall, a perennial staycation spot in the UK, it will be for lithium.
The beating heart of the electric car revolution, supercharged by Musk’s Tesla, is the lithium-ion battery. Right now, Tesla sources the mineral from Australian hard rock (others source it from South American salt flats), then ships it all the way to China to be made into batteries. Two startups, Cornish Lithium and British Lithium, are hoping to extract the mineral in England’s most southwestern county and tempt companies like Tesla to open battery factories in the UK.
Localizing production will hasten the growth of the UK market, and could help set Britain up for 2035, when experts predict it will need 59,000 tonnes of lithium a year to implement a planned ban on petrol, diesel, or hybrid cars. But more than that, it will facilitate a much-needed shift in the electric car market, away from long, environmentally damaging supply chains, towards localization.
Muscling in on China, which accounted for 73% of all lithium cells made in 2019, will be a tough ask — but not an impossible one, for various reasons.
Lithium-ion batteries are classed as dangerous goods, and transporting them can be costly. Mining lithium in Australia or Chile, shipping it to China, then shipping the finished batteries over to Europe to power the latest green car also leaves a big carbon footprint. Buying an electric car instead of a petrol-powered one is meant to be an eco-friendly choice, and one that governments are encouraging — but long supply chains detract from this.
Gigafactories — where lithium-ion batteries are produced — can be built in less than 24 months. Britishvolt is bringing the first of these to the UK in South Wales. It aims to produce batteries that have 30 gigawatt hours of power each year.
“Domestic sourcing of raw materials where possible is important because that gives you security of supply,” says Simon Moores, managing director of Benchmark Mineral Intelligence, which analyses the battery-to-electric vehicle supply chain. “Especially in a post-COVID era where this trend of globalisation is being cut back … Every major country that produces cars is going to need its own battery capacity.”
The Gigafactory in South Wales will not be enough. Moores says the UK will need between three and seven such factories to produce 200 gigawatt hours, the amount needed to meet the expected UK growth in demand by 2027. By 2040, eight more Gigafactories will be needed, according to The Faraday Institution.
For that to happen, the UK government must do more. China succeeded, despite its long supply chain, in part because “the government identified champions to spearhead these industries forward,” Moores adds.
Prime Minister Boris Johnson says the right things, backing “British innovation” and “high-risk, high-reward projects” in a speech in June. But to enter the global battery race, Moores says, “the government has to build a 21st Century energy blueprint,” starting with the sourcing of raw materials like lithium, and continuing to help manufacturers like Tesla strike long-term raw material contracts with other nearby countries, too.
The UK’s energy revolution
The timing could not be better, because the UK is quietly undergoing an energy revolution. During lockdown, it went for a record-breaking 67 days without coal, which provided 80% of its power as recently as 2008. For more than two months, the country relied on renewable sources like wind and solar, types of energy that can be stored using lithium-ion batteries.
Cornish Lithium is part of the Lithium for the UK study, funded by the Government’s Faraday Battery Challenge, that is exploring Cornwall as a potential supplier of battery-grade lithium. It recently raised more than $1 million, on top of $1.8 million from 1,200 investors it found in an online drive last October, to continue its evaluation of lithium from hot springs and hard rock in Cornwall. In August, it was announced it would receive $5.23 million from the government for a project with Geothermal Engineering Ltd, to build Europe’s first geothermal lithium recovery pilot plant.
British Lithium, which recently received more than $650,000 in government funding, drilled the first lithium exploration holes in the UK last year and will start a pilot-scale test next year. “If you can create a domestic supply of lithium […] and you can tailor it to Tesla’s requirements, then I think that would be a significant advantage for them,” says Andrew Smith, British Lithium’s chief executive.
Cornish Lithium’s chief executive Jeremy Wrathall adds: “A battery manufacturer where they can secure their supply of battery-grade lithium on their doorstep. Surely that’s a good thing?”
Battery Passport, announced earlier this year, promotes this localization, providing battery producers with a kind of quality seal for minimising their carbon footprints. The European initiative is aimed at ensuring battery manufacturers make their supply chain as ethical and environmental as possible, and could help break up China’s stranglehold on the market. But Britain is not the only European country in the game. Other countries compete with US states, and each other, to seduce Tesla with subsidies. At the moment, Germany appears ahead in attracting the likes of Musk.
A startup named Vulcan Energy Resources is paving the path towards zero-carbon lithium extraction in the Upper Rhine Valley. It is home to Europe’s largest lithium reserve and aims to start producing battery-grade lithium using geothermal power by 2023. Nearby Gigafactories are coming from the likes of Volkswagen and Northvolt, which recently signed a $2.3 billion battery supply contract with BMW. Brexit uncertainties also swayed Musk to choose Berlin over Britain last autumn for Tesla’s next Gigafactory.
But Cornwall does not lack for confidence, with good reason. The extraction process that Cornish Lithium proposes would be carbon neutral, or even negative, as excess geothermal energy could be sent to the power grid. Compare that with Chile, where up to 500,000 gallons of water are needed to extract one tonne of lithium from the arid Atacama desert, or with Australia, where the lithium Tesla sources is made by roasting ores at white-hot temperatures, to the cost of the environment.
“In Chile, the biggest problem is magnesium and other elements that are in the brine which get in the way of getting it out quickly,”‘ says Cornish Lithium’s Wrathall. “So far in Cornwall, we’ve found very few bad elements or none.”
The confidence may be well placed. Up the coast in Bristol, in June, there were reported sightings of Elon Musk.