A NZ start-up has secured funding from Stora Enso to produce graphite from wood chips, using a patent technology that could make up half the global demand for lithium-ion battery production by 2030!
It comes as Ford Motors warned the United States earlier this year that the West was not ready to compete with China on EVs and called for the industry to learn and adapt quickly.
As reported in September, Stora Enso uses Lignin, up to 30% of the wood composite, to produce highly processed, fine carbon fibre for batteries.
Now, Wood Central can reveal that CarbonScape has secured a US $18 million investment from the Finnish forest giant, battery producer Amperex Technology Ltd (ATL), and other parties to commercialise production.
The investment, according to CarbonScape, “marks a critical shit to clean energy” and is a crucial piece of the puzzle as the global leaders look to reduce emissions as part of COP28 discussions.
The start-up is pushing onshore manufacturing and claims that the technology will help Western battery manufacturers in the face of “increasing supply chain instability, while also onshoring production of a critical material to meet rapidly growing demand.”
Graphite production is the largest single carbon emitter in the battery raw material supply chain; by switching to bio-based substitutes, manufacturers could cut the carbon footprint of each battery by 30%.
By volume, it makes up the most significant portion of a lithium-ion battery, up to half its weight.
CarbonScape has patented a process to use forestry industry by-products, such as wood chips, to make a bio-based substitute for graphite.
Founded in 2006, it began developing a process to make “biographite” from forestry and timber industry by-products such as wood chips a decade later.
The technology offers the global lithium-ion battery industry a “drop-in alternative to synthetic and mined graphite, enabling local production, high performance, and a negative carbon footprint.”
It has a pilot facility in Marlborough, New Zealand, where it produces biographite for customer testing and validation.
The new funding will see the company dramatically scale up its production capabilities and invest in European and US production facilities.
Using Less than 5% of forestry by-products, it claims it can produce enough graphite to meet half the projected demand for EV and grid-scale batteries.
According to Ivan Williams, CarbonScape’s CEO, “this investment represents a strong support for sustainable sourcing of battery materials for global decarbonisation.”
Moreover, the new investment will “enable the establishment of localised battery supply chains from the ground up.”
“If we are to truly move away from fossil carbon and power our economies through mass electrification,” he said, “we urgently need sustainable alternatives like biographite to scale quickly.”
Currently, graphite for the anodes of batteries comes from mined natural or synthetic graphite produced from petroleum products.
However, CarbonScape’s new bio-graphite substitute “has a carbon negative footprint, saving up to 30 metric tons of carbon dioxide emissions per tonne of material compared to synthetic or mined graphite.”
The material can also be manufactured close to battery factories, “helping to cut down on CO2 emissions compared to mined graphite transported from distant locations.”
Wood Central understands that graphic makes up to half the weight of lithium-ion batteries, which is essential to the electric vehicle and energy storage sectors.
However, global demand far outstrips supply, and a deficit of 777,000 tonnes annually is expected by 2030.
EV makers, including Tesla, have been rushing to secure graphite outside its dominant producer, China.
Europe also has heightened anxiety about China’s lithium-ion battery supply chain dominance.
On Monday, Recharge News revealed that EU leaders have been warned to avoid repeating the mistakes of their previous reliance on Russian gas by becoming dependent on Chinese lithium-ion batteries needed for the energy transition.
Taiwan has emerged as a global semiconductor and lithium-ion production powerhouse in recent years.
According to Taiwan-based CommonWealth Magazine, “In 2020, the revenues from semiconductor industries contributed 15% of Taiwan’s GDP, and ranked No. 1 in the world by dominating more than 20% of the global semiconductor-related revenues.”
European Commission President Ursula von der Leyen recently attacked China for “deliberate policies” to cause supply chain issues in the renewables sector.
The EU claims that China has already cornered the market for lithium-ion batteries, “without implementing strong measures, the European energy ecosystem could have a dependency on China by 2030 of a different nature, but with a similar severity, from the one it had on Russia before the invasion of Ukraine,” they claim.
There is concern that Chinese manufacturers could outcompete their European counterparts with cheap and mighty wind turbines that are too hard to resist developers, much as they did in the solar sector.
The head of Europe’s leading wind industry group, WindEurope, warned project developers to think about the “long-term implications” before being “tempted” by Chinese wind turbines that he claimed are being offered with unfair subsidies and could be a security threat.
