Electric vehicles for The Green Highway today and for the foreseeable future all require lithium ion batteries.
Manufacturing them is expected to be a $100-billion industry in less than 20 years. Today, Japanese companies like Sony, Panasonic and Toyota are leaders in a $9-billion business. South Korea isn't far behind with Samsung and LG and China, of course, is investing massively in lith-ion R&D and production. Let's not forget the United States, where President Barack Obama announced a goal of ending dependence on Middle East oil by 2018. His stimulus package handed the Department of Energy $167-billion for "innovations."
Where does that leave Canada? Surprising as it may sound, Canada has a horse in the race. And this horse, while a long shot, is no nag.
It's Electrovaya Inc., which has been working on lith-ion technology since 1996. The company was recently awarded two contracts to supply Chrysler with Lithium Ion SuperPolymer battery systems for 25 Plug-In Hybrid minivans and 140 Plug-In Hybrid pickup trucks.
"Lithium-ion batteries have their dirty little secret - except for Electrovaya they all use massive quantities of toxic chemicals for manufacturing. We are probably the only one who doesn't use any toxic chemicals," said Sankar DasGupta, Electrovaya's CEO.
"The main toxic chemical which is used by all other lithium-ion battery producers is a chemical called N-methyl-pyrrolidone which is known as NMP. The U.S. Environmental Protection Agency puts NMP in the same category as mercury and asbestos."
NMP is a solvent used to prepare metal surfaces. It is also in many paint strippers. The U.S. Consumer Product Safety Commission warns consumers: "Excessive contact with NMP may cause skin swelling, blistering, and burns. N-methyl-pyrrolidone can readily get into the body through the skin and may cause health problems. NMP may cause reproductive problems and harm to unborn children."
"As a Toronto company," says DasGupta, "we started up in downtown at King and Dufferin, where we had restaurants and coffee roasters and so on. So when we started experimenting with this NMP, we all had a fit and said there's no way we can develop this technology in the middle of downtown Toronto. So we were driven from the very beginning not to use these toxic chemicals."
Today, he explains, that approach is a big plus. He argues that a nuclear plant is expensive for the radioactive containment and that it's the same thing for lithium-ion battery plants. "If you get rid of that containment problem of toxic chemicals like we did, then you can have a nice clean plant sitting here. What's the point in building a green car if you have reproductive problems in the supply chain?"
The great battery race is yet to be won, especially in North America. The Chevy Volt uses batteries from LG, the Nissan Leaf gets its from a joint venture between Nissan and NEC Energy Devices of Japan. Both have lots of Department of Energy money attached. The hot lith-ion IPO of 2009 was A123 Systems, which started trading at $13.50 U.S. and today is around $5. A123 and Electrovaya have both announced automotive contracts.
Environmental permitting for new lith-ion manufacturing facilities with NMP toxicity issues could become more difficult. Germany, which has extremely high environmental standards, has not permitted the kinds of facilities that have been built with government assistance in the United States. Electrovaya believes it may have the opportunity to licence its technology to larger companies that face this problem. "It also means our capital costs are dramatically lower, our operating costs are dramatically lower so we can build a battery at a much better price," says DasGupta.
Canada might be a player yet in the lithium-ion battery world that has so far been developing without much noticing us.
A123 Systems, which makes lithium ion batteries, had an IPO price of $13.50 (U.S.) in late 2009; it initially traded higher than $25, but is now trading around $5. The company has also announced some automotive contracts. Incorrect information appeared in the story above, which has been corrected.