CarbonScape Invests US$18 Million in Biographite Production in Europe and the United States to Tackle Material Scarcity for EVs and Battery Storage

Recently, New Zealand-based battery material developer CarbonScape announced an US$18 million investment to commercialize production of biographite in Europe and the United States. This is a carbon-negative alternative, produced from forestry and timber by-products, so it is a sustainable alternative for the critical material used in lithium-ion batteries. The main investors include Stora Enso, a leading provider of renewable products in packaging, biomaterials, and wooden construction, and Amperex Technology Limited (ATL), a global lithium-ion battery producer and innovator. The goal is to provide alternative supply chains, as demand increases for lithium-ion batteries used in Electric Vehicles (EVs) and energy storage systems.

With the shift toward clean energy and reporting emissions throughout production processes, enterprises are searching for solutions to reduce waste and emissions wherever possible. Graphite accounts for up to 50% of the weight of lithium-ion batteries, making it a valuable resource, not only for production and material procurement, but also on the impact of emissions reduction if done creatively. As batteries for EVs and energy storage become more popular in the near future, the demand for materials will start to outpace the natural supply of graphite with some reports forecasting a deficit of 777,000 tonnes per annum by 2030. With China producing the majority of natural graphite, countries and enterprises are looking to alternative supply chains for many of the materials for lithium-ion batteries. By positioning production in Europe and the United States, CarbonScape intends to further reduce emissions incurred from delivering products over long distances.

Biographite has a negative footprint, saving up to 30 tonnes of Carbon Dioxide (CO2) emissions per tonne of material compared to synthetic or mined graphite. To meet the future demand for graphite, synthetic processes will need to triple existing production capacity or 100 new mines will need to be constructed. Both methods likely result in increased fossil fuel use which comes with social scrutiny and environmental costs.

CarbonScapes’ biographite is not the golden answer that solves the demand for graphite, but another tool that can assist with demand soon. We may see the rise of other biographite plants if it is determined enough of a success. With synthetic graphite costing around US$20,000 per tonne and natural graphite costing about US$11,000 per tonne, the question comes down to the cost of the product, and if it is too much for EVs and energy storage. This new source of graphite is something for lithium-ion battery manufacturers to keep an eye on, as even with a higher price tag, shorter distances for transportation and considerable reductions in emissions can be attractive selling points.

After cost, another question will be if they have sufficient supply of woody products from forestry and timber industries. They will be generating the by-products on an almost continuous basis, but they are already capitalizing on their by-products for any use possible with wood fuel being the most common, on-site or locally. The question becomes if selling their by-products for biographite production yields a better profit over wood fuel. At the start, they may have to attract attention by agreeing to higher prices, which, in turn, raises the cost of the biographite. Forestry and timber industries should consider supplying their by-products to increase and diversify their revenue streams; it is also low risk if the demand slows down because they can easily return to alternative uses for their by-products.

It is almost inevitable that the need for biographite will increase over the years as enterprises and industries look for carbon-negative products and materials. More and more enterprises release statements about their efforts, with many of them sounding repetitive and lacking any innovation or advancing creative solutions. An interesting aspect of biographite will be the early adopters of it and whether they will use it to showcase their efforts in fighting climate change, separating themselves from the herd and garnering a positive outlook from the public. EV manufacturers and energy storage projects can gain the most from showcasing biographite.