Driving your electric car off the cobalt cliff


First, a backgrounder on modern battery chemistry: Quote:

The original lithium-ion batteries introduced by Sony in 1991 used a lithium-cobalt-oxide, or LCO, cathode powder that was roughly 60% cobalt by weight. While LCO has remained the preferred chemistry for personal electronics for almost 30 years, it was never viewed as an enabling chemistry for electric vehicles because cobalt is scarce and expensive and LCO cells have a less than spectacular safety record.

In 1996, lithium-iron-phosphate, or LFP, and lithium-manganese-oxide, or LMO, chemistries were introduced. While these new chemistries had lower energy density than LCO, they were far safer and they were made from abundant precursor materials. They were widely heralded as enabling chemistries for electric vehicles and most early EVs used LFP or LMO batteries.

In 1999, two nickel-rich cathode chemistries were introduced:

  • The nickel-cobalt-manganese, or NCM/NMC, chemistry used equal proportions of nickel, cobalt and manganese to reduce the cobalt content from ~60% to ~20%.
  • The nickel-cobalt-aluminum, or NCA, chemistry used mostly nickel with small amounts of cobalt and aluminum to reduce the cobalt content from ~60% to ~9%.

Since 1999 battery developers have continued their efforts to reduce cobalt content, however the pace of progress has been glacial. After almost 20 years of concerted R&D, manufacturers are currently producing:

  • NCM-111, where cobalt is 20.3% of cathode powder weight;
  • NCM-523, where cobalt is 12.2% of cathode powder weight;
  • NCM-622, where cobalt is 12.2% of cathode powder weight;
  • NCA-80,15,5, where cobalt is 9.2% of cathode powder weight; and
  • NCA-84,12,4, where cobalt is 7.9% of cathode powder weight.

In general, increasing the nickel content in a cathode formulation will improve energy density but reduce stability, which means there’s a trade-off between cost and safety. This graph from a 2014 presentation by BASF and Argonne National Laboratory shows how the stability and cost of NCM batteries decline as nickel content and discharge capacity increase. It’s a trade-off. You get the best safety in the middle of the triangle with NCM-111. As you move toward NCM-811 in the bottom right hand corner, the discharge capacity increases but the cost and stability decline sharply.[…]End of quote.

All very interesting, but I am hardly going to trot all that out at the next dinner party!

More recently, Marc Grynberg, the CEO of Umicore, bluntly explained why battery manufacturers can’t design cobalt out of their products. Quote:

“If you increase the nickel proportion, you reduce the stability of the battery and so it has an impact on cycle life, the ability to charge it fast,” he said.

“Cobalt is the element that makes up for the lack of stability of nickel. There isn’t a better element than nickel to increase energy density, and there isn’t a better element than cobalt to make the stuff stable. So (while) you hear about designing out cobalt, this is not going to happen in the next three decades. It simply doesn’t work.” End of quote.

Based on the NCM-622 chemistry above and the demand for cobalt from electric vehicles makers, the world will need 184,000 tonnes per annum by 2025.

Looking at the current cobalt situation: Quote:

Of the 104,600 tonnes of cobalt the world’s refiners produced last year, roughly 9,000 tonnes was used in EV batteries and the balance was used for high-value industrial applications and batteries for electronics and other portable devices. When the cobalt cliff arrives, the high-value industrial applications and batteries for electronics and other portable devices will be far less cost sensitive than the EV market. So from my perspective, the only supply EV manufacturers can count on is the surplus nobody else wants. […] In its new “Cobalt Market Review 2017-18,” Darton Commodities said:

“Do we think we are heading for the ‘cobalt cliff’ that some market commentators are predicting? The figures would suggest not quite just yet, as a 2017 demand increase to 103,900 MT was offset by a growth in supply of refined units of 104,600 MT. With [new] assets coming on stream in 2018 and […] 2019, the market could be in surplus until the exponential increase in predicted EV sales kicks in beyond 2020. However, with no new meaningful cobalt assets coming on stream at that time a heavy production/consumption deficit looks assured. On the basis of this longer-term outlook it is more likely that any near-term surplus supply will be pre-emptively purchased and stockpiled by larger consumers in anticipation of deeper, future supply deficits.

Most of the world’s automakers will accept the cobalt cliff as an inconvenience that delays their announced plans to electrify portions of their new car fleets. They won’t be happy about the situation, but they’ll take the natural resource constraints in stride and continue making money by manufacturing and selling conventional automobiles.

Tesla and other pure play EV manufacturers will be pushed to the wall and most likely driven out of business because they have no capacity to weather sustained raw material shortages by manufacturing other products.

At this point, owning shares of Tesla is a sucker’s bet of the first order because the company cannot survive the cobalt cliff without a Deus ex Machina miracle that makes cobalt irrelevant to EV manufacturers. Cobalt may be a bridging material till something better comes along, but a bridge that isn’t long enough is called a pier. End of quote.

Which makes one wonder about all the pie-in-the-sky proclamations from countries around the world that are banning the sales of petroleum powered vehicles.  from Wikipedia

Did we mention the lovely way the batteries burn?  No, but back to the dinner party conversation:

Next time you encounter one of the holier-than-thou EV drivers prattling on about how green they are, ask them what the electrolyte in their batteries is.

The electrolytes are usually an organic solvent, such as ethylene carbonate, dimethyl carbonate, and diethyl carbonate.

Do those names ring a bell?

Organic: the chemistry of carbon atoms: ‘Zero’ Carbon, James?

Ethylene and methanol: those wouldn’t be the by-products of the evil natural gas we are not allowed to look for anymore, would they, Jacinda?

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