The long-term opportunities of e-mobility depend on the supply of green electricity – and on sufficient supply of battery raw materials. But where are they supposed to come from? Would self-sufficiency in Europe be conceivable?
The long-term opportunities of e-mobility depend on the supply of green electricity – and on sufficient supply of battery raw materials. But where are they supposed to come from? Would self-sufficiency in Europe be conceivable?
It would be a terrifying scenario for the car manufacturers'self-proclaimed "e-offensive" that is just getting underway: more and more consumers are interested in electric driving, but battery production can hardly keep up.
Surprised by the pick-up in demand, many providers could have supply problems – similar to the current situation with microchips. At least the risk of not having the necessary amount of cell modules available later is a concern for the industry. Europe's manufacturers are expanding their capacity. But where do all the raw materials for batteries and electronics come from?
Putting more emphasis on intra-European extraction
One idea: to promote more materials right on the continent, especially in times of brittle global supply chains and high dependence on Asian suppliers. Eurobattery Minerals (EBM) is pursuing this approach. The Swedish mining and exploration company wants to increase the level of self-sufficiency in nickel, cobalt and copper for batteries in electric cars. The aim is also to increase intra-European extraction of rare earths, for example in electric motors.
According to the company, this is also about the standards for dismantling. "The main suppliers of these materials are currently China, Congo and Chile, where the raw materials are extracted under devastating conditions," eBM said. Non-governmental and UN organisations have often condemned exploitation in sometimes appalling ecological and humanitarian circumstances, and some political actors also use force to make enormous profits from "conflict raw materials". EBM CEO Roberto Garcia Martinez promises a "focus on ethical production and traceability".
Can single provision be successful at all?
But even if control in Europe is better, is a raw material source exclusively from its own sources realistic in view of the expected battery volumes? Martinez believes this. EBM has launched mining projects in Sweden, Finland and northern Spain with researchers – the company has recently been listed in Germany. Especially in Finland, industry expert Ferdinand Dudenhöffer also sees even more potential in "battery mining" and processing. BASF is also involved in projects there.
The Federal Institute for Geosciences and Raw Materials (BGR) considers complementary funding to be important in Europe. However, it is another question as to whether sole provision of e-mobility is successful. "You are still dependent on other suppliers," says Peter Buchholz, head of the German Raw Materials Agency at BGR. "It is good that additional capacities are being built up in Europe. But projects need to be cost-competitive." Nickel is mined in Canada or Australia "to the best available environmental and social standards." And: "Finland is already an interesting location for nickel and cobalt compounds."
So tapping domestic stocks is not entirely new. Felix Kuhnert of the consulting firm PwC stresses: "Economically, it makes sense to build a European supply chain." Even more than the extraction of raw materials, however, "their processing is centralized to the purity required in batteries in China – and would greatly benefit from building Up European capacities." Indirectly, this could therefore play into the hands of competitors in the Far East. "The construction of battery cell factories, on the other hand, is already taking place so quickly that overcapacity could threaten in the middle of the decade."
VDA Car Association: Maintaining Global Networking
The German car industry association VDA is in favour of a two-pronged raw material strategy. "In the short and medium term, self-sufficiency in the EU is unrealistic. Although there are initial projects, most of them are still in the planning stage," it says. A scale-back of global connectivity is not an option: "Germany and Europe as export-oriented locations depend on open borders. A principle of foreclosure or pure regionalisation is contrary to the successful model of the European economy."
However, the demands on regional added value and short transport routes are growing. And the EU is also putting pressure on the battery cell issue: talks are underway in the ERMA commodity alliance on a safer supply of valuable minerals. The Vice-Chairman of the European Commission, Maro's Efsovic, and Internal Market Commissioner Thierry Breton announced the launch of the alliance at the end of September. Associations, trade unions and non-governmental organisations can join the Alliance.
Recycling instead of energy-intensive replenishment
In the long term, it also plays a role in how well-used batteries are recycled. "With the annual demand for new batteries growing from 40 gigawatt hours today to 500 gigawatt hours by 2030 and a holding period of more than seven years, the raw material question cannot initially be solved by recycling," Kuhnert said. It makes sense to set up already closed recyclablechains in pilot projects. "But industrializing these recyclable circuits poses major challenges for car manufacturers."
VW, for example, is already investing in the issue. In Salzgitter, where the central engine factory will soon have its own cell production, the recycling of battery raw materials is now underway on an experimental basis. It is about aluminium, steel and copper, but also about nickel, manganese and cobalt. Instead of an energy-intensive supply through further mining and global transport, the materials are to be extracted from old parts and continued to be used with "second-life concepts". According to previous plans, 1,200 tons of batteries per year are to be recycled here.
Ceo Herbert Diess has declared overall responsibility within the Group, from procurement to construction to second use. On Friday, Chief Technology Officer Thomas Schmall plans to present further details and goals at the start of the plant. Volkswagen invests more than one billion euros in battery cell production in Salzgitter.
