The Graphite Game Changer
5 November 2015
http://energyandgold.com/2015/11/05/the-graphite-game-changer/
$12.2 trillion will be invested in global power generation in the next 35 years and the Tesla Gigafactory is just the beginning
According to a Bloomberg report earlier this year, $12.2 trillion will be invested in global power generation in the next 25 years, with renewables counting for 2/3s of the investment. Tesla, as witnessed by its multi-billion dollar gigafactory, is the first to strike.
Tesla CEO Elon Musk’s goal is to be building 500,000 electric-vehicles (EV) by 2020. With this planned production rate in the latter half of the decade, Tesla alone will require today’s entire worldwide production of lithium-ion batteries. There are two primary raw materials necessary to build lithium-ion batteries; lithium and graphite. In fact, it is estimated that 15 times more graphite than lithium is required in a lithium-ion battery.
In a clear indication that Tesla has begun sourcing the raw materials needed for its Nevada gigafactory, last week Tesla signed a 5-year lithium supply agreement with Vancouver based Pure Energy. This puts Tesla well on its way to meeting its lithium supply needs, however, the company still faces the task of securing its graphite needs for the gigafactory.
Tesla can acquire this through the supply of synthetic graphite, which is very expensive (up to $20,000 per tonne) and requires fossil fuels to manufacture. Both of which go against Tesla’s announced mandate to reduce the cost of battery production and move away from reliance on hydrocarbons.
Alternatively, they can secure off-take from a high quality, graphite deposit, much like they did with the Pure Energy lithium deposit (which would be aligned with their corporate mandate). Become vertically integrated; own your raw material; guarantee quality control and secure your future supply. Given the substantial concerns surrounding Chinese graphite mines (world’s largest graphite producer) it is quite likely that Tesla will seek a North American (possibly even American) source for its graphite.
