Written by Anna-Sophie Hobi, PhD Fellow, NoragricSeveral companies are currently planning to build battery cell Gigafactories in Norway. Although the emerging industry is promising new 'green' economic growth for the oil-dependent country, it is reliant on lithium and other raw materials that are ex Contact online >>
Written by Anna-Sophie Hobi, PhD Fellow, NoragricSeveral companies are currently planning to build battery cell Gigafactories in Norway. Although the emerging industry is promising new ''green'' economic growth for the oil-dependent country, it is reliant on lithium and other raw materials that are extracted elsewhere.
With several Gigafactories planned to be built over the coming decade, Norway is taking strides in the battery business. The country''s new ''industrial adventure'' is promising a ''green'' and ''sustainable'' form of economic value creation, bringing jobs and innovation. However, batteries depend on minerals, such as lithium, which are extracted abroad. Therefore, it is important to inquire on what material basis the emerging industry is built, and with what consequences beyond our borders.
Norwegian battery visions
In the past months, electric vehicle (EV) batteries have received enormous attention in Norway – not only due to the country''s high percentage of fossil-free cars on the roads. Several companies are developing factories to produce the world''s ''greenest'' battery cells, primarily based on lithium-ion technology.
After a new large-scale battery project was announced last December, the national broadcaster NRK reported that potential hosts were "queuing to become battery-municipalities". The world''s largest aluminum producer Hydro, the state-owned former oil and gas – now energy – company Equinor and Panasonic initiated a battery partnership. Their so-called Joint Battery Initiative is looking for a suitable location for their plants – 82 municipalities across the country have applied to host it.
In the meantime, three other projects aspire to deliver lithium-ion batteries within half a decade. One of them is in Mo i Rana, an industrial town just below the arctic circle. Freyr, which recently got listed on the New York Stock Exchange, is constructing four battery plants with up to 43 GWh capacity by 2025. These factories could produce cells for up to 800''000 electric cars a year. The Rana municipality is optimistic: Expecting 1500 new jobs, it bought shares in Freyr worth 10 million NOK last year, and is even considering to build a new airport.
The new battery industry in Norway promises economic growth, up to 30''000 jobs, regional development and technological innovation. In its latest climate action plan, the government identified industries along the battery supply chain as key to ''green growth. Battery technology also speaks to desires of mitigating climate change: According to Morten Halleraker, Head of Batteries at Hydro, lithium-ion batteries are "one of the solutions to our generation''s biggest challenges: global warming".
The initiatives in Norway are in line with the European efforts to ramp up battery production. More importantly, however, batteries and other renewable technologies are envisioned by industry experts to guarantee Norway''s future as an "energy superpower" in light of decreasing demand for fossil fuels. In other words: "Putting its industrial capacity and financial strength to use in the green transition could turn the country from a ''climate villain'' to a green giant", a recent UCL policy brief stated.
Even though it remains to be seen how, and if at all, the Norwegian battery dream becomes reality, it is certain that a shift from oil and gas production to renewable energy technology would still depend on forms of extraction. Battery manufacturing relies on vast amounts of minerals such as lithium, which are mostly sourced from abroad.
Critical towards the ''green'' and ''responsible'' promise
The battery projects aim to manufacture ''green'' batteries in Norway. A low carbon footprint is on one hand guaranteed by Norway''s electricity supply – 98 percent of its electricity comes from renewable sources. On the other hand, ''green'' batteries are understood as being based on low-carbon and responsibly sourced raw materials. For instance, on their website, Freyr declares their intention to develop a ''green'' value chain and to produce ''clean'' battery cells made from raw materials "with the lowest possible carbon footprint and socially responsible production".
The Norwegian Naturverforbundet is not only questioning how, but also on what scale and intensity, the extractive rush for lithium and other battery raw material are taking place. Their criticism is relevant: Phasing out fossil-fuel driven cars – i.e. Norway bans their sale from 2025 – the demand for ''critical raw materials'' is rising quickly. The latest International Energy Association report, for instance, expects the demand for lithium in batteries to grow 30-fold until 2030 and more than 100-fold by 2050. As a consequence, lithium mining will inevitably increase.
The European battery sector has been concerned by the Chinese dominance in the lithium supply chain, and by the increasingly important labeling of metals with carbon tags and environment, social and governance (ESG) standards. As a consequence, governments and mining industries are eying new mineral reserves to tap into, in order to secure steady supplies of lithium in the future.
Norway has increased its geological mapping to identify underground resources – including in the deep sea. On land, Norway does not have any economically viable lithium deposits, according to the Norwegian Geological Survey. On the seabed, however, recent expeditions have discovered high concentrations of lithium, amongst other minerals, along the Mid-Atlantic Ridge. When, and if at all, these deposits will be ''harvested'' remains unclear.
In Europe, a number of hard-rock mining projects have been announced in Serbia, Finland, Portugal and Spain. However, Bloomberg Metals analyst Kwasi Ampofo, believes that by 2030, Europe will still have no significant capacity in producing lithium chemicals. Considering that Chinese actors largely control the lithium supply chain, lithium will likely still be shipped across the globe, at least for the first generations of Norwegian batteries. In the future, European mining could lower carbon emissions of European batteries by shortening transport routes, and increase supply security for Norwegian and European battery producers.
Expanding mining of battery raw materials in Europe is strongly supported by the European Union. According to the EU, a ''reliable, secure, and sustainable access to raw materials is a precondition for Europe''s Green Deal''. Recent efforts to develop battery policies and regulations have implied mandatory supply chain due diligence: The latest proposal for the EU batteries regulation recommends to include lithium in the scope of the supply chain due diligence obligations and requires its sourcing to be sustainable. The Norwegian government will adapt its law accordingly, and has already proposed a new human rights transparency and due diligence regulation. These steps seem to move into a positive direction in terms of responsibility and accountability of lithium sourcing.
Mining projects in Europe, however, have not been less contested than elsewhere. In Spain or Portugal, for instance, people have opposed lithium mining plans in local and national protests. For them, open-pit mines threaten local heritage, natural environments and livelihoods. Local activists and residents in Northern Portugal fear pollution and destruction and in the name of ''green'' mobility and ''clean cities''.
Decarbonising (individual) transportation with battery driven EVs is bound to rely on minerals such as lithium. And while increasingly attention is paid to responsible, transparent – and shorter – supply chains, the projected spike in extraction creates ambiguities in perceptions of what ''green'' and ''sustainable'' futures are.________________
Anna-Sophie Hobi is a PhD Fellow at Noragric. With an interest in themes of energy transition and extractivism, her research focuses on lithium and its role in the futures of Zimbabwe and Norway. Previously, Anna-Sophie worked on transparency and responsibility in the commodity sector as a Mercator Fellow on International Affairs. She studied Social Anthropology and Prehistoric Archaeology at the University of Basel and Linnaeus University.
________________This article is also published on the Lithium Worlds website.
Tesla CEO Elon Musk has promised dramatic changes in how his company makes batteries that power its electric vehicles and stationary energy storage packs. It''s now working to develop next-generation lithium-ion cells that are cheaper and more energy-dense. But he''s hardly alone in this effort. Big competitors like General Motors and China''s BYD and CATL have their own breakthrough battery plans, and so does ambitious Norwegian startup Freyr.
Named for the Norse god of fertility, Freyr thinks it''s got a shot at becoming a global battery powerhouse by using a highly automated production system for battery cells utilizing a new design that''s easier to manufacture. It opened a small-scale factory line this week in Mo I Rana, Norway, to start making "SemiSolid" lithium-ion cells and intends to have two multibillion-dollar plants—Giga Arctic in Norway and Giga America near Atlanta, Georgia, capable of churning out a combined 50 gigawatt-hours of batteries–running by 2025.
"If we can produce at gigawatt-hour scale we will have costs that are 25% lower than conventional battery production," Tom Einar Jensen, Freyr''s CEO and cofounder, told Forbes. "The reason for this is that the production process is dramatically simplified. We''re moving from 17 steps in a conventional production system down to 8, which means less steel, less aluminum, less casing, less housing, less everything. So cap ex goes down by 50% or more, energy consumption goes down by 60% or more. The space of the facility is reduced by 80% on a per-gigawatt-hour basis, and we can produce three times as many batteries per employee relative to conventional facilities."
Freyr, which started listing shares on the New York Stock Exchange in 2021 via a SPAC merger, isn''t yet generating revenue. With a market cap of just over $1.1 billion, it''s joining an intense cleantech competition with far bigger, better-funded companies, including Tesla, GM, BYD, CATL, Panasonic, Ford and LG Chem, all of which are pouring billions of dollars into new battery production facilities around the world. But transitioning the transportation industry to electric power from carbon-spewing fossil fuels and developing better, more affordable options for large-scale storage of renewable electricity also creates a massive business opportunity for new players that can deliver on big promises.
The large pouch cells Freyr is producing—bigger than either the cylindrical 2170 lithium-ion cells in Tesla''s battery packs or the beer-can-size 4680 cells it''s shifting to—rely on technology licensed from battery startup 24M that Massachusetts Institute of Technology professor Yet-Ming Chiang developed. And unlike Musk''s EV company, Jensen says Freyr initially targets energy storage and commercial vehicle markets rather than battery-powered passenger vehicles.
"We''ve started out focusing on energy storage applications because that''s the sweet spot of the technology. We''ve already signed more than 130 gigawatt-hours'' worth of demand through firm offtakes and conditional offtake contracts," he said.
"We''ve started out focusing on energy storage applications because that''s the sweet spot of the technology."
Freyr also has an initial contract to supply batteries for a maker of electric buses and vans that he didn''t identify. The company will expand into the broader electric vehicle market eventually but sees batteries for energy storage as especially attractive.
"We could be selling batteries to the energy storage market any day of the week and twice on Sunday and not really focus on EVs," Jensen said. "But we are because we can adapt this technology also to the electric vehicle market."
The Inflation Reduction Act, or IRA, which became law last year and provides the biggest investments and incentives for clean energy and electric vehicles in U.S. history, also altered Freyr''s initial strategy. The legislation enticed it to announce its Georgia plant last November to take advantage of federal incentives for domestic battery production. That $1.7 billion facility will be built on 368 acres of land in Coweta County and employ 720 people when fully ramped up to produce up to 34 GWh of lithium-ion cells annually.
"We were getting ready for that (plant) and then we accelerated into it," Jensen said. "The IRA is generating additional interest for us to accelerate into the incentive pool."
Equity analysts remain generally upbeat about the company''s prospects, though shifting to mass-scale production will be a test. "As we look out into the next five years, there are numerous milestones that the company needs to pass to begin generating revenues such as: winning customer orders, building the plants, hiring the right people, starting production and thereafter harvesting 24M''s semi-solid battery technology," JP Morgan analyst Jose Asumendi said in a recent note. "Clearly, there is significant execution risk in the equity story."
For now, Jensen thinks less about benchmarking Freyr''s success relative to Tesla than against rival Scandinavian battery startup Northvolt.
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