EV battery production is carbon intensive, but technology innovations have strong potential for improving efficiency
Electric vehicles are gaining popularity globally among governments and consumers alike, due to their low carbon emissions and zero tailpipe emissions. While this is largely true, battery powered EVs have an emissions challenge of their own because the production of EV batteries itself is a carbon intensive process. A recent report by McKinsey & Co. estimates that making EV batteries generates as much emissions as producing all the other materials that go into making an EV - i.e. up to 40 - 60% emissions in the EV manufacturing process comes from battery production.
Both, an EV and an equivalent ICE vehicle emit between five to ten tons of CO2 during the manufacturing of their body shells, but manufacturing a typical EV with a 75-kWh battery pack emits more than seven tons of CO2e. This makes emissions from an EV production double of than from an ICE vehicle production. This is largely because of the materials used and energy needed to produce EV batteries such as critical minerals, anodes and cathodes.
But, the good news is that it is very much possible to reduce emissions from the battery production process by up to 75% in the next five to ten years. Technology alternatives can reduce carbon emissions and save costs as well.
Fig 1 - Battery manufacturers should focus on reducing emissions in the above four key areas
The first and most significant link in the EV battery value chain to look at is emissions from raw mineral extraction and refining, which accounts for a quarter of the total battery production emissions. Procuring the minerals from sustainable producers — those that might already have switched to electrified mining equipment or renewable-energy sources for electricity, for example — can result in an emissions reduction in some cases of up to 30 percent per battery cell created.
How industry leaders can accelerate decarbonization
Given the fast growing investments in renewable energy and the awareness around sustainability in business practices, the three routes to decarbonising EV batteries are:
- Decarbonising the grid : Batteries produced in Europe carry an inherently lower carbon footprint as a large segment of the continent’s power grid uses hydro, nuclear, solar and wind power. Setting up the NorthVolt battery manufacturing plant in northern Sweden is an example of a manufacturer taking advantage of the region’s vast hydroelectric and wind power potential. Conversely, batteries manufactured in China are up to 70% more carbon-intensive as the country is the largest consumer of coal power. Countries can encourage sustainable battery production by sourcing from batteries produced through renewable sources.
- Decarbonising the supply chain : The EU has also passed a law that will require battery manufacturers to report the CO2 footprint of their batteries from mining to production by 2024, and this will be used to set CO2 footprint limits for the batteries they sell within Europe. This will not only encourage the use of clean energy across the supply chain but also boost the share of materials extracted from recycled batteries. At present the carbon footprint of recycled battery materials is already around four times smaller than that of raw materials from primary sources.
- Increasing transparency: : Manufacturers could increase transparency by establishing standards and metrics, such as battery passport through which a digital twin of the physical battery can be created to collect, exchange, collate, and report data among all battery lifecycle stakeholders on the materials used, their chemical make-up and manufacturing history, and sustainability performance.It is expected that a combination of these steps could lower the global average of GHGs from battery production from 100 kg CO2 e/kWh at present to 85 kg CO2e/kWh by 2025. Some leading players are already aiming to cut emissions below 20 kg CO2e/ kWh—or up to almost ten times less than the most emission-intensive OEMs today.
India’s efforts to address GHG emissions through revised guidelines
Recently, the government made amendments to the Battery Waste Management Rules to address waste reduction, under which the manufacturers will be required to collect and recycle their batteries packs under Extended Producer Responsibility (EPR). The rules – by providing scope for an exchange of EPR certificates between producers and recyclers to comply with EPR obligations – aim to incentivise the recycling of EV batteries in India, which is a strong step towards lowering the quantum of material and energy that is expended into manufacturing new batteries every year.