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Originally posted on May 28, 2024, at 1:00 PM. Edited on May 28, 2024, at 11:00 PM to update market projections.

This update is provided for informational purposes only and is based on the opinions and interpretations of the management of Nano One Materials Corp. (“Nano One” or the “Company”) as of the date these insights are provided.   Contact the external site for answers to questions regarding its content. Certain information contained herein may constitute “forward-looking information” and “forward-looking statements” within the meaning of applicable securities legislation. All statements, other than statements of historical fact, are forward-looking statements. Generally, forward-looking information can be identified by the use of terminology such as 'believe', 'expect', 'anticipate', 'plan', 'intend', 'continue', 'estimate', 'may', 'will', 'should', 'ongoing', ‘target’, ‘goal’, ‘encouraged’, ‘projected’, ‘potential’ or variations of such words and phrases or statements that certain actions, events or results “will” occur. Forward-looking statements are based on the current opinions and estimates of management as of the date such statements are made are not, and cannot be, a guarantee of future results or events. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements or forward-looking information, including but not limited to: general and global economic and regulatory changes, expected demand for LFP, competitive conditions, current and future collaborations, the Company's ability to achieve its stated goals, the development of technology, supply chains, and plans for construction and operation of cathode production facilities, the functions and intended benefits of Nano One’s technology and products, the commercialization of the Company’s technology and patents and potential revenues which would reasonably expected to come from such activities,  and other risk factors as identified in Nano One’s MD&A and its Annual Information Form dated March 27, 2024, both for the year ended December 31, 2023, and in recent securities filings for the Company which are available at www.sedarplus.ca. Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements or forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements and forward-looking information. The Company does not undertake any obligation to update any forward-looking statements or forward-looking information that is incorporated by reference herein, except as required by applicable securities laws. Readers should not place undue reliance on forward-looking statements. This newsletter is not a solicitation to buy securities and does not constitute an offering document under securities laws. None of the information or analyses presented are intended to form the basis for any investment decision, and no specific recommendations are intended.

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Battery 101

How Lithium-Ion Batteries Work

Lithium-ion batteries operate by facilitating the movement of lithium ions from the anode to the cathode through the electrolyte, thereby producing electrical energy.

Charging reverses this process, directing ions back to the anode.

Charge

Discharge

The History of Li-ion Batteries

• 1970s
• 1980s
• 1990s
• 2000s
• 2010s
• 2020s

M. Stanley Whittingham's Innovation

Proposed first lithium battery, pioneering alternative energy solutions.

John Goodenough’s Cathode Breakthrough

Significantly boosted battery capacity and stability, laying the foundation for future lithium-ion battery advancements.

Akira Yoshino’s Anode Breakthrough

In 1985, Akira Yoshino developed a battery with an anode of petroleum coke, a carbon material which, at a molecular level, has spaces that can house lithium ions. This was the first commercially viable lithium-ion battery.

Pioneering the Commercial Lithium-Ion Battery Revolution

Sony and Asahi Kasei’s collaboration led to the launch of the first commercial lithium-ion battery, revolutionizing portable electronic devices and shaping modern technology. 

Electronic Devices

Lithium-ion batteries rapidly became integrated into mobile phones, laptops, and other electronic devices, boasting significant advancements in safety, longevity, and energy density.

Electric Vehicles

Lithium-ion batteries played a pivotal role in powering electric vehicles, contributing to the global shift towards sustainable transportation and aligning with the growing awareness of environmental concerns. 

Meeting Global Demand

We’re witnessing a global surge in grid electrification, driving demand for our low-cost, high-performance cathode powders and patented process.

As of March 2023, projections indicate battery manufacturing capacity exceeding government commitments, aligning with Net Zero Emissions by 2050.

Components of a Li-ion Battery

CAM 101

Cathode Active Materials (CAM)​

Critical for the transition to clean energy, cathode active materials represent the highest cost component in lithium-ion batteries.

Scaling up CAM production to meet net-zero targets for 2050 brings challenges, but with innovation and collaboration, it can be done.

See Our Innovation Hub Meet Our Collaborators

Common Cathode Materials and Their Attributes

Cathode active materials, with their diverse compositions and raw inputs, are fundamental in defining a battery’s performance characteristics such as energy density, longevity, power output, and efficiency.

LFP

LFP boasts enhanced durability and safety with a lower cost. Its pack density is comparable to that of NMC, making it suitable for mass-market electric vehicles and energy storage systems.

NMC

NMC offers increased density, but reduced durability and higher cost due to the complexity of the materials involved. It is commonly utilized in luxury long-range electric vehicles.

LNM

LNM features reduced density, but increased voltage and enhanced charging capabilities. It represents next-generation chemistry tailored for niche applications.

CAM 101: Other Applications

Battery Energy Storage Systems

Market Benefits

Rapid Market Growth​

The projected growth is expected to outpace that of the electric vehicle (EV) market over the next ten years.

Diversified Providers

A greater variety of Battery Energy Storage System providers, each employing distinct cell strategies.

IRA​ Compliant & Investment Tax Credits​

North American cell and pack manufacturing is encouraged through various funding programs that offer incentives or credits, aiming to comply with the Investment Tax Credit and the relevant provisions of the Inflation Reduction Act (IRA).

Longer Duration Applications

Larger cells result in extended cycle life (over 12,000 cycles) suitable for longer-duration applications.

CAM 101: LFP

Benefits of LFP Batteries

Lithium iron phosphate (LFP) batteries are gaining popularity among standard-range EVs, with major auto manufacturers incorporating this technology into a wider range of car models.

High Safety

A low risk of overheating ensures high safety.

Low Cost

The materials used in production are cost-effective.

Long Life-Cycle

Continued high performance and capacity throughout extensive cycle.​

Sustainable

Non-toxic, recyclable, and easier to source ethically.​

Our LFP Production

Near-Term Opportunities

Since 2021, LFP’s popularity has surged and Nano One has facilitated its adoption beyond China.

Our goal is to leverage our patented One-Pot process to develop this facility as a model for future LFP production plants.

See Our Commercialization Hub

CAM 101: LFP vs. NMC

Comparing Cathodes

In LFP based lithium-ion batteries, all of the lithium ions (Li-ions) may be removed and re-inserted during charging and discharging without collapsing LFP’s cupboard-like compartments. This maximizes the utility, efficiency and sustainability of the lithium, iron (Fe) and phosphorus (P) battery metals.

In NMC based lithium-ion batteries, if too many lithium ions (Li-ion) are removed during charging NMC’s bookshelf-like layers will collapse and prevent Li-ions from being re-inserted during discharge. This limits the utility, efficiency and sustainability of lithium, nickel (Ni), manganese (Mn) and cobalt (Co) battery metals.

Read Full Insight

LFP NMC Side-By-Side

CAM 101: Challenges

Energy-Intensive Manufacturing Processes

The current processes for refining critical minerals and producing battery materials were not designed to meet the significant demands of replacing fossil fuels which result in serious environmental challenges with existing production processes.

Long

Complex

Wasteful

CAM 101: Challenges

Durability and Cycle-Life

One challenge involves decreased durability and cycle life when using conventional polycrystalline cathode particles. The industry’s approach to address this is by growing large single crystals, which requires longer calcination (kiln) times, consequently reducing kiln throughput.

However, our solution involves the formation of individually coated nanocrystals in a single step, which resist fracture and enhance durability and performance.

Conventional Polycrystalline Cathode Particles​

Protective coatings are formed with additional steps but repeated charge cycles damage the coating, exposing individual crystals to side reactions.

Standard Cathodes

Nano One’s Coated Single Nanocrystal Cathode​​

Nanocrystals, individually coated and formed in a single step, exhibit enhanced durability by resisting fracture.

Our Cathodes

CAM 101: Challenges

Scaling Sustainably

Meeting Net-Zero 2050 targets without changing the current CAM manufacturing processes is untenable.

1 Billion+ Tonnes of Sulfate Waste

That's the same as 250+ thousand Olympic-sized pools.

1 Trillion Litres More Water Needed / Year

That's the same as 400+ thousand Olympic-sized pools.

1.1 Billion Tonnes of CO2(e) Emitted

That's the same as the yearly global aviation emissions.

The post Battery & CAM 101 appeared first on Nano One®.

“The EV industry is trying to mobilize 8 billion people with cleaner transport and energy solutions using manufacturing processes and networks designed in the ’90s.”

Lithium-ion batteries—having reliably lit up our phones and laptops for years—are now powering our Electric Vehicles (EVs). Unsurprisingly, the surge in demand has led to a bottleneck in battery metals and chemicals supply chains. That’s because they weren’t designed to fulfill the scale we need to power the energy transition. Despite this, companies are scrambling to ramp up battery production.

Numerous long-term mining projects are underway, preparing to stock these batteries’ future raw material needs. Let’s say they get through all the start-up hurdles and become operational—they still need to catch up to enter a market moving with tremendous pace and momentum. For now, auto OEMs are being pushed by a confluence of factors to adopt different sourcing strategies. Some are investing in mines, and others are investing in recycling.

Supply in operational mines have past and present challenges. Mines are on backorder, and new ones aren’t exactly quick or cheap to build. Nor does the sector have the greatest track record for capital deployment discipline. And while today’s mining sector prioritizes sustainability and community engagement, past practices still haunt it. This makes it a hard place for EV-eager automakers to park their brand. But the reality is that the EV transition isn’t viable without new mines.

A century ago, the auto sector invested in mines to secure the raw materials to build their Internal Combustion Engine (ICE) vehicles. This vertical integration was done out of necessity to alleviate supply chain constraints. Sound familiar? We’re right back to where motorized road transport first began. Direct supply chain investment is a prerequisite today for achieving a successful ICE-to-EV energy transition.

The hard truth about recycling is that we won’t have a sizable amount of EV batteries to recycle until 2030-2040. Yet battery recycling has garnered more attention than sectors in the supply chain with more imminent build-out needs. This is thanks to the widespread understanding of the environmental value associated with recycling. Whether we should source materials from mines or old EV batteries is not in question. We need it all, to be frank. Recycling can become so influential that sector giants like Tesla equate it to the future mines for EV raw materials. Keyword: future.

Zoom Out:

It’s not just raw minerals that are a necessity here. It’s also innovation and collaboration which must continue simultaneously around the supply chain. It is a strategic imperative that we embrace new technology innovations. To adopt a differentiated approach to extracting, refining, processing, and manufacturing critical minerals into battery materials. This will ultimately make recycling more effective when we face the end-of-life for all these batteries. The technology gap that needs to be filled today is in sustainable processes. How do we get there? Embracing change and working together. This is a non-negotiable for a zero-emission, clean energy future.

Mining Virgin Raw Materials

“Why not source materials from operational mines? They’ve been spoken for.”

Mines aren’t all at the same stage of readiness, especially in suddenly booming industries like EVs.

Developing a new mine requires a significant upfront investment, with a high risk of not making it past the initial phases. Even if it does, it could take years to produce, meaning it won’t fulfill the short-term sourcing needs. So, why not source materials from operational mines? They’ve been spoken for.

Operational Mines have a supply that is reserved and largely slated to head to China until at least 2025. These mines are the obvious places to go for the pre-requisite materials to supply battery metals and chemicals—the low hanging fruit—but they no longer suffice to meet the projected global demand for EVs.

Advanced Development Mines are about five years away from production (even less if they’re already permitted and financed). The supply here is also largely spoken for—tied up with offtake agreements with the automotive sector today.

Mid to Long-Term Projects aren’t far enough along to secure offtake agreements or an automotive investment using conventional practices. But both are needed to advance these projects closer to becoming mines. They may also be missing key components that mitigate development risk such as asset quality, jurisdiction, “permittability” or a quality senior leadership team. There’s too much risk for the automotives to get meaningfully involved at this stage, which inherently forces these projects to rely on higher cost and often scarce or cyclical risk capital. These projects are five to ten years away from production and require significant funding through many engineering studies while they also navigate permitting and maintain community engagement.

Exploration Projects are even riskier, with the probability of becoming a good development project on the lower side. This isn’t a great place to look for near-term sources anyways, given it could take 15+ years to go from exploration to production.

These are some of the challenges in virgin raw material sourcing that have led to increased investment and short-term material sourcing strategies in recycling.

Recycling Battery Materials

There is no doubt that recycling a battery when it’s no longer useful to the vehicle will play a paramount role in the EV battery material supply chain. Automakers know this, as shown by their willingness to make investments and commitments to ensure that the supply chains of tomorrow are set up properly to support a successful EV transition. These investments appear to be as much about having a recycling plan as they are about making a public statement of support on recycling batteries—a strategy to counter the batteries in landfills narrative. Like the other links in the chain, innovation is critical here to improve efficiency for when there are batteries at scale to recycle.

"Mining for virgin raw materials means it’s coming straight from the earth, for the first time. In contrast, mining for raw materials can also refer to recycling, as minerals are being extracted out of end-of-life batteries."

However, we’re at least 10-15 years away from facing that reality. Possibly longer, given it’s still being determined where batteries go at the end of their useful vehicle life. They may first be re-purposed and go to energy storage applications.

Ultimately automakers will control batteries at their end-of-life— deploying incentives to secure them and send them back upstream—to be the non-mined or, urban mined, source of critical raw materials.

Battery Gigafactories and Scrap Material Recycling 

Large-scale battery makers—AKA Gigafactories—produce a considerable amount of scrap materials in their first few years of production. Initial yields are typically less than 50% of total capacity and take years to get to 90% at best. When you hear public discourse on battery recycling today, this is most likely what is being discussed. Some may argue that these aren’t true recycled materials; it’s really waste recovery and is necessary.

Current recycling business models

1. In-house Recycling: Some battery manufacturers recycle leftover scrap materials within their production facilities.
2. Outsourced Recycling: Battery manufacturers may outsource their recycling processes through external recycling companies.
3. Buyer-Trader Model: Battery manufacturers can sell their scrap materials to interested buyers. If the buyer is a recycling company, they can recycle the materials independently or pursue alternative methods. 

This scrap ultimately ought to go back into the front end of the automotive supply chain. If not today, it will eventually, because the largest buyers will control their critical minerals.

EV Battery Pack Design Implications on Recycling

Is the customer still always right? I don’t think so. Even consumers need to embrace change to achieve net-zero emission goals. Some quick math reveals that most people don’t need the larger EV.

Yet a prominent challenge in the electric vehicle (EV) industry revolves around the growing demand for larger battery packs to alleviate consumer concerns regarding range limitations. The prevalent desire for 300+ mile electric vehicles stem from auto sector marketers recognizing the need to address customers’ apprehensions regarding daily commutes exceeding this threshold. Understanding consumer behaviour reveals their inclination towards habitual routines, as they prefer not to undergo inconveniences such as altering their charging habits or enduring extended charging times during their presumed 300-mile commutes.

Consequently, the prevailing approach has been integrating larger batteries into the vehicle platform, maximizing kilowatt-hour (kWh) capacity to mitigate range anxiety and drive sales.

These larger battery packs, however, do not typically undergo strenuous usage cycles, given that the average daily or weekly driving distances fall short of the maximum range capacity. Nevertheless, even under more demanding usage scenarios, they are engineered to endure at least 1,000 cycles, specifically for NMC (nickel-manganese-cobalt) batteries. To illustrate, assuming a weekly charging cycle, this translates to nearly 20 years of functional lifespan before the battery capacity falls below 80%—a commonly accepted threshold denoting the end of life for an electric vehicle battery.

Cathode Active Material (CAM) Innovation

Inertia is a powerful force. And its now driving the momentum of the fast-paced build-out of EV battery supply chains which, will arguably only accelerate into the next two decades. But before the rubber really hits the road, we must change how we’re doing things. We must embrace new processes and technologies in every aspect of the supply chain, and CAM manufacturing is no exception.

The current CAM practices are unsustainable and unscalable, particularly if we are to consider them in alignment with the goal to reach net zero emissions by 2050. The CAM manufacturers and automotive players are struggling to put batteries between wheels today. This is common knowledge in the industry. Today’s technology installations are good for the next five, maybe ten years. But to be competitive and to stop a mess before it’s a problem, differentiated technologies will need to be installed.

But commercializing new technology comes with tremendous challenges. Challenges in a sector that is moving with immense momentum. The easy road is to simply repeat. Change is perceived as risky.

There is hope, though. Nano One has a long list of partners willing to change and who see the merits of our technology. They are willing to embrace a challenge. Leaders like Rio Tinto, BASF, Umicore and most recently, Sumitomo Metal Mining.

This energy transition isn’t just about cleaner transport and energy storage. It’s about cleaning up our planet. And a better future. I don’t want to look back over my shoulder in 20 years only to see another mess we’ve created.

I know you don’t either.

Sources

The Economist Podcasts
https://open.spotify.com/episode/5RBZigzWJXvdQAKCrQ0Npw?si=Wj1l4oUIRjaYTxH1TiTJWw&context=spotify%3Ashow%3A12zKAMNyS2GNentUzxq9QN

Benchmark Mineral Intelligence
https://source.benchmarkminerals.com/article/financing-the-battery-arms-race-the-514-billion-cost-of-bridging-the-global-ev-supply-chain-divide

IEA report
https://iea.blob.core.windows.net/assets/4eb8c252-76b1-4710-8f5e-867e751c8dda/GlobalSupplyChainsofEVBatteries.pdf

IEA (2022), Global Supply Chains of EV Batteries, IEA, Paris 
https://www.iea.org/reports/global-supply-chains-of-ev-batteries, License: CC BY 4.0

S&P global podcast
https://www.spglobal.com/commodityinsights/en/market-insights/podcasts/platts-future-energy/041823-black-mass-battery-recycling-ev-lithium-nickel-cobalt-manganese-price-assessment-supply-deficit

Circular Energy Storage Research and Consulting
https://circularenergystorage.com/articles/2022/9/7/a-tsunami-or-a-drop-in-the-ocean-how-to-calculate-the-volumes-of-lithium-ion-batteries-available-for-recycling

Global News
https://globalnews.ca/news/9405696/electric-vehicle-battery-recycling/amp/

https://medium.com/tradr/teslas-approach-to-recycling-is-the-way-of-the-future-for-sustainable-production-5af99b62aa0e

Visualcapitalist.com

Disclaimer:

_{This update is provided for informational purposes only and is based on the opinions and interpretations of the management of Nano One Materials Corp. (“Nano One” or the “Company”) as of the date these insights are provided.   None of the information or analyses presented are intended to form the basis for any investment decision, and no specific recommendations are intended. Accordingly, this does not constitute investment advice or counsel or solicitation for investment in any security. The Company shall not be held responsible for any direct or consequential loss or damage arising from the use of the information provided herein. This includes, but is not limited to, any interpretation, reliance upon, or other use of such information, as well as any inaccuracies, omissions, or typographical errors. The Company does not undertake any obligation to update any that is incorporated by reference herein, except as required by applicable securities laws. Any actions taken as a result of the information provided are solely at your own risk.} 

_{Please note that any links provided to third party websites on this platform are for informational purposes only. We do not endorse or take responsibility for the content, accuracy, or any other aspect of these websites. Additionally, we are not liable for any damages or loss arising from the use or access of any third party website linked to from our platform. Users should exercise their own discretion and review the terms of use and privacy policies of any third party website before accessing or interacting with their content.} 

The post EV Battery Supply Chains: The Missing Links to Sustainable Processes appeared first on Nano One®.

The Solution to Climate Change is in Your Hands

Your smartphones and laptops have been powered by lithium-ion batteries for years, affording them a reputation as the backbone of modern technology. As a response to climate action demands, automakers, miners, and governments are facilitating their application to power cars and store renewable energy—pivoting from a dependence on fossil fuels. Nothing is now more synonymous with lithium-ion batteries than electric vehicles (EVs). However, the current battery manufacturing process wasn’t designed to meet the significant demands of replacing fossil fuels.

The industry’s production volume to date has been negligible compared to the booming market demands it’s striving to fulfill. Global production surges will have significant environmental repercussions, including massive sulfate waste streams, high energy and water consumption and greenhouse gas emissions. Until now, these issues have remained largely unnoticed due to China’s dominance in the lithium-ion battery manufacturing sector. Limited environmental regulations and a lack of transparency have facilitated this. Geopolitical concerns are accelerating the build-out of new battery supply chain systems in North America, Europe and the Indo-Pacific region.

As we work towards designing new EV battery supply chains, we must align manufacturing and regulations as well as incentives to create the right framework that encourages local production while avoiding large environmental problems in the decades to come. Instead of asking 'How do we get as many EVs on the road as fast as possible?' we need to ask, 'Is this the right solution?'

It is essential that we analyze battery supply chains closely, and make a concerted effort to improve extraction, refining, chemical processes, and manufacturing while minimizing the environmental impact before it is too late.

We are facing a once-in-a-generation opportunity to do it right and re-imagine what fuels our global population of 8 billion. It’s worth mapping out this journey, well ahead of time, to avoid dead ends and looming pitfalls, so that we can keep our foot on the accelerator in the race to achieve net-zero goals.

Lithium-Ion Battery Supply Chain

The supply chain for lithium-ion batteries goes through several stages that starts with mining or recycled materials, refining and purification of minerals, and is followed by processes that combine several purified minerals into an energy-storing battery material (known as cathode active material, or CAM), before it is assembled with other battery components to make a battery cell, modules of cells and ultimately battery packs that go into EVs and other energy storage applications. In the chemical production steps that are currently used to make CAM, there are millions of tons of wasteful sodium-sulphate and wastewater being generated as by-product. This has large disposal, recycling and cost implications, and it puts pressure on limited water and clean energy resources, particularly in western economies where permitting and environmental stewardship govern the growth of heavy industries.

The proper recycling and end-of-life management of lithium-ion batteries is another crucial link in the battery supply chain. Recycling is an essential piece of the bigger net-zero challenge; it is not only needed now to recycle mountains of early-stage off-spec battery manufacturing scrap, but we need it in the long run, to increase the available minerals, minimize mining, and help further decarbonization. The lead in lead-acid batteries is 99% recycled and, for lithium-ion batteries, we must not settle for less.

Current lithium-ion battery recycling methods face challenges in recovering each of the valuable minerals and in minimizing the waste; the process mimics the refining of mined materials, and eventually when combined into CAM, using entrenched processes, there will still be large volumes of wastewater and sodium-sulphate generated every time a battery is recycled; this seems counter-productive. Many recyclers have emerged in the race to secure and process today’s battery scraps, but it is only through innovation - and changing how cathode materials are made - that we will be able to eliminate the wasteful by-products and truly lay claim to a circular economy.

Why the Midstream Matters

CAM is the most expensive component in a lithium-ion battery cell, accounting for half the total cost, primarily driven by the cost of lithium, nickel and other raw material inputs. It is also the most energy intensive, environmentally impactful, and sensitive to security of supply. All of this, while also being critical to the performance of a battery, including energy density, power, cycle life and safety, affecting EV range, efficiency and functionality.

Stability and safety are also greatly influenced by CAM, with its resistance to degradation directly affecting the battery’s overall longevity and safety. Developing high-performance, stable cathode materials can result in batteries with extended life cycles and reduced risks of thermal runaway—a critical concern in the industry. This extends to the battery’s charging performance, including its charge and discharge rates. Enhanced charging capabilities are essential for promoting the broader adoption of electric vehicles, as they reduce the time required to recharge the battery, extend the lifecycle of the car, and offer greater driving range to owners. There are different types of CAM, including iron, nickel, manganese and cobalt based chemistries, and each has its pros and cons, relating to range, charging, cost, and other trade-offs, like safety and longevity.

The processes for manufacturing CAM are old and outdated, developed in the early 90’s when production volumes were low, energy efficiency was of minimal concern, and environmental impact was negligible. These processes were not designed with the kind of volumes that are needed for the net-zero future; we change these processes so that we can ramp to produce 10s of millions of tonnes of CAM and we must do so economically and as stewards of the environment, by eliminating energy inefficiencies and wasteful by-product. We must change how CAM is made, while also improving performance and safety, and this will require vision, patience, capital and collaboration across the ecosystem to onramp new technologies while preparing to offramp those that are serving us now.

Disclaimer:

This update is provided for informational purposes only and is based on the opinions and interpretations of the management of Nano One Materials Corp. (“Nano One” or the “Company”) as of the date these insights are provided.   None of the information or analyses presented are intended to form the basis for any investment decision, and no specific recommendations are intended. Accordingly, this does not constitute investment advice or counsel or solicitation for investment in any security. The Company shall not be held responsible for any direct or consequential loss or damage arising from the use of the information provided herein. This includes, but is not limited to, any interpretation, reliance upon, or other use of such information, as well as any inaccuracies, omissions, or typographical errors. The Company does not undertake any obligation to update any that is incorporated by reference herein, except as required by applicable securities laws. Any actions taken as a result of the information provided are solely at your own risk.

Please note that any links provided to third party websites on this platform are for informational purposes only. We do not endorse or take responsibility for the content, accuracy, or any other aspect of these websites. Additionally, we are not liable for any damages or loss arising from the use or access of any third party website linked to from our platform. Users should exercise their own discretion and review the terms of use and privacy policies of any third party website before accessing or interacting with their content.

The post From Mine to Market: How Cathodes Can Enhance EV Innovation appeared first on Nano One®.

The drive for energy storage solutions for transportation and renewable energy grid storage signals a major shift away from fossil fuels towards an environmentally sustainable future. This depends, to a large extent, on the development of effective and affordable lithium-ion batteries (LiB) that must deliver high energy storage capacity and long lifetime without being prohibitively expensive. The most widely recognized cathode active materials used in LiBs today are lithiated transition metal oxides containing lithium (Li), nickel (Ni), manganese (Mn) and cobalt (Co), known as NMC and to a lesser extent lithium iron phosphate, containing lithium (Li), iron (Fe) and phosphorous (P), known as LFP. Recent price volatility and supply chain risk has caused battery manufacturers to give greater consideration to iron-based cathode materials because the raw material supply is less constrained, less costly and the resulting cathode is very safe and durable. Demonstrated in 1996 by Nobel Laureate John Goodenough, lithium iron phosphate, LFP or LiFePO₄ is set to become a major component, alongside NMC in the future of energy storage.

What is LFP and how is it different from NMC?

NMC materials are metal oxides that incorporate lithium (Li) into the crystal structure, forming layers of transition metals with space between the layers for the Li ions to move in and out as the cell is discharged and charged. If all the Li is removed the NMC structure will collapse and stop working thereby limiting the amount of charge available to the cell and leaving a portion of the Li, Ni, Co and Mn unused with diminished efficiency and sustainability. These materials are not very stable and abuse can lead to loss of oxygen causing a potential fire risk. (See Figure 1 for Analogy: battery charging with NMC cathode as a bookshelf)

Figure 1. In NMC based lithium-ion batteries, if too many lithium ions (Li-ion) are removed during charging  NMC’s bookshelf-like layers will collapse and prevent Li-ions from being re-inserted during discharge. This limits the utility, efficiency and sustainability of lithium, nickel (Ni), manganese (Mn) and cobalt (Co) battery metals.

LFP is an olivine crystal structure in which the iron is bound to a phosphate ion (PO₄^3-) which is known to be chemically very stable, and as such can be readily found in nature; the P-O bond is very strong meaning that oxygen loss, and risk of fire, is very unlikely. Another unique attribute of LFP olivines is that all of the Li may be removed and re-inserted without collapsing the structure for maximum charge and discharge of the cell. LFP uses all of Li, Fe and P in the cell, for maximum efficiency and sustainability and this is contrasted with NMC in Figure 1. The lack of oxygen loss and structural change means that LFP cathode materials are very stable and cycle lifetime of many thousand cycles are achievable. (See Figure 2 Analogy: battery charging with LFP cathode as a bookshelf)

Figure 2. In LFP based lithium-ion batteries, all of the lithium ions (Li-ions) may be removed and re-inserted during charging and discharging without collapsing LFP’s cupboard-like compartments. This maximizes the utility, efficiency and sustainability of the lithium, iron (Fe) and phosphorus (P) battery metals.

One of the difficulties with LFP is that it is not as conductive as the oxides like NMC. Because the material must serve as an electrode, electrical conductivity is critical for its operation in a cell. It was discovered that if the individual crystals of LFP were coated in conductive carbon, LFP would function very well in a cathode and, although methods such as doping with other metals was investigated, carbon coated LFP has become the standard for this type of cathode.

The theoretical charge capacity of LFP is 170mAh/g and practical capacities of 120 – 160mAh/g are common depending upon the application. The discharge cell voltage is around 3.2V. These values are lower than conventional NMC cathodes but offset with greatly improved durability, safety and battery pack energy densities made possible by the chemical stability of the phosphate. LFP full cells may survive up to 9,000 charge/ discharge cycles, which is currently unparalleled in LiBs (Sandia National Laboratory, 2020)¹. The long life and extra durability greatly enhances the economics, efficiency and sustainability of LFP batteries.

The cost of Fe remains low and stable compared to the extreme market volatility of Ni and Co. Unlike Ni and Co, the global markets for Fe and P dwarf LiB demand projections, making security of supply in the long-term much greater for LFP than NMC. This means that the cost of LFP should be considerably lower than Ni and Co laden NMC, particularly when considering cycle life and total cost of ownership over the lifetime of the battery ($ per kWh per cycle). The form of lithium used to make LFP is also more flexible because lithium hydroxide and carbonate may both be used. Ni-rich NMC currently requires lithium hydroxide for manufacture, although companies like Nano One have developed methods that use lithium carbonate as well. This means that the cost and availability of LFP compares very favourably when compared to NMC cathode materials.

NMC will remain of great importance for long range electric vehicle applications, and LFP will be better suited to heavier duty cost-sensitive applications in industry, renewable energy storage and mass market low and mid-range urban vehicles. Nano One has developed a novel process that is applicable to both NMC, LFP and other cathode materials, reducing complexity, cost and environmental footprint. For making LFP, it uses a supply chain that is more competitive and better suited to markets outside of China. This technology is in the process of being scaled up towards commercialization for applications in North America, Europe and other emerging jurisdictions .

In summary, LFP may grow to have significant market share, alongside NMC, for both EVs and renewable energy storage. LFP is lower cost, longer lasting and safer, which offsets its lower energy density. Together with recent innovations in the energy density of LFP cells and battery packs, electric vehicle and renewable energy storage manufacturers are able to meet the range and performance requirements of the future.

[1]              Yuliya Preger et al; J. Electrochem. Soc. 167 (2020) 120532

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Last week, the Government of Canada tabled the 2023 Budget. As expected, it responds to large government programs in the United States, namely the Inflation Reduction Act (IRA) and The Infrastructure Investment and Jobs Act (IIJA). The Canadian Budget builds on programs announced in the 2022 Budget and doesn’t attempt to match dollar-for-dollar with the US Government. At almost 1/10 of the population, Canada cannot compete at that level.

We also saw some big news on Friday out of Washington which we’re still digesting. More on that later.

Minister Freeland acknowledged Canada’s reputation for caution and prudence, citing recent banking crises in the U.S. as evidence that this approach is advantageous in economic policies. As a result, the brakes have been hit on broader spending and investment, other than social programs, but it is full steam ahead for the clean economy.

The minister compares this once-in-a-century economic opportunity to the construction of the Transcontinental Railway, which connected the country and strengthened the economy. This analogy resonates with Nano One as we have already embarked on our Pan-Canadian endeavours to establish a sustainable economy. Our research and development innovation center is situated in British Columbia, while our commercialization facility is located in Quebec

Zoom out
We are also paying close attention to decisions in America around how Precursor Cathode Active Materials (PCAM) and Cathode Active Materials (CAM) are treated in the IRA. We advocate for a clean, reliable, safe, and secure battery ecosystem in North America. The US Treasury Department’s Proposed Guidance is something we are monitoring, and conversations at the SAFE Summit in D.C. last week reinforced two things:

1. Miners, innovative clean tech, chemical suppliers, automotive original equipment manufacturers (auto OEMs), and investors are pushing for a localized North American battery supply chain, and governments are collaborating.
    
2. Auto OEMs have differing views on how best to deliver on electric vehicle promises. Some agree that PCAM and CAM should be allowed outside North America and qualify for IRA benefits. Other OEMs have set in motion a North American system that is more stringent when it comes to allowing materials from outside North America.

With the IRA guidance out, a consultation period mixed with domestic politics (i.e. creating jobs while making EVs affordable) has created much activity in this space. Ultimately, Canada, the EU, and US must remain conscious that competition to attract investment may lead to a detrimental “race to the bottom,” which will hurt taxpayers and businesses in the long term. Decisions being made in 2023 will set the stage for decades to come.

Therefore, Canada’s support should be targeted, significant, and short-term to help accelerate the development of supply chains and technology toward a more favourable outcome. Canada has shown an ongoing commitment to building a battery ecosystem through tax incentives designed to encourage investment and ongoing dialogue with the US.

Regardless, there is a significant need for what Nano One is doing, and we continue to be strategic to meet demand. We can compete within the current framework of the IRA and will continue to encourage a better way of making battery materials.

Zoom In
One of the three pillars of Canada’s 2023 budget is Affordable Energy, Good Jobs, and a Growing Clean Economy. Here’s how that breaks down for companies in the EV battery supply chain:

Image source: A Made-in-Canada Plan: Strong Middle Class, Affordable Economy, Healthy Future, pg. 86  

The Investment Tax Credit for Clean Technology Manufacturing
A refundable tax credit equal to 30 percent of the cost of investments in new machinery and equipment used to manufacture or process key clean technologies and extract, process, or recycle key critical minerals.

The Strategic Innovation Fund
$500 million over ten years to support the development and application of clean tech and an additional $1.5 billion of its existing resources towards projects in sectors including clean technologies, critical minerals, and industrial transformation. 

Enhancing the Reduced Tax Rates for Zero-Emission Technology Manufacturers
Extend the availability of reduced rates of 4.5 percent for small businesses and 7.5 percent for other businesses by another three years, such that the reduced tax rates would no longer be in effect for taxation years starting after 2034, subject to a phase-out starting in 2032.

Canada Growth Fund
Partnering with PSP Investments to begin making investments to support the growth of Canada’s clean economy.

Disclaimer:

This update is provided for informational purposes only and is based on the opinions and interpretations of the management of Nano One Materials Corp. (“Nano One” or the “Company”) as of the date these insights are provided.   None of the information or analyses presented are intended to form the basis for any investment decision, and no specific recommendations are intended. Accordingly, this does not constitute investment advice or counsel or solicitation for investment in any security. The Company shall not be held responsible for any direct or consequential loss or damage arising from the use of the information provided herein. This includes, but is not limited to, any interpretation, reliance upon, or other use of such information, as well as any inaccuracies, omissions, or typographical errors. The Company does not undertake any obligation to update any that is incorporated by reference herein, except as required by applicable securities laws. Any actions taken as a result of the information provided are solely at your own risk.

Please note that any links provided to third party websites on this platform are for informational purposes only. We do not endorse or take responsibility for the content, accuracy, or any other aspect of these websites. Additionally, we are not liable for any damages or loss arising from the use or access of any third party website linked to from our platform. Users should exercise their own discretion and review the terms of use and privacy policies of any third party website before accessing or interacting with their content.

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In April, the Government of Canada released Budget 2022 which substantially builds on commitments to clean tech and the development of a comprehensive plan to localize the battery supply chain and attract investment. In advance of Budget 2022, through meetings and written submissions, Nano One provided suggestions on how Canada can encourage innovation that will drive investment, create jobs, reduce emissions and give North America energy security as we create a responsible battery supply chain. Our voice, along with others in our sector, were listened to and as a result, the Government has introduced revamped and new programs that will have a lasting impact on Nano One.  This Budget creates new potential sources of support for our scale-up to commercialization as well as R&D. Beneficial Tax measures are being introduced that will be helpful directly to Nano One and more broadly support Canada’s effort to attract large anchor projects to fuel innovation and localization of a battery sector.   

Key Highlights Include: 

• $3.8 billion to implement Canada’s first Critical Minerals Strategy to capitalize on a growing need for the minerals used in everything from phones to electric cars
• Establish an investment tax credit of up to 30 percent focused on clean tech 
• Establish the Canada Growth Fund. $15 billion over five years to attract investment
• $1.5 billion in new funding to the Strategic Innovation Fund (SIF) for critical minerals projects with a prioritization given to manufacturing, processing and recycling applications
• $150 million to new programs that support R&D and deployment of technologies and materials to support critical mineral value chains
• $750 million to support Superclusters, now called Global Innovation Clusters, that in part will help fund the battery supply chain in part through fostering world-leading advanced manufacturing

Disclaimer:

This update is provided for informational purposes only and is based on the opinions and interpretations of the management of Nano One Materials Corp. (“Nano One” or the “Company”) as of the date these insights are provided.   None of the information or analyses presented are intended to form the basis for any investment decision, and no specific recommendations are intended. Accordingly, this does not constitute investment advice or counsel or solicitation for investment in any security. The Company shall not be held responsible for any direct or consequential loss or damage arising from the use of the information provided herein. This includes, but is not limited to, any interpretation, reliance upon, or other use of such information, as well as any inaccuracies, omissions, or typographical errors. The Company does not undertake any obligation to update any that is incorporated by reference herein, except as required by applicable securities laws. Any actions taken as a result of the information provided are solely at your own risk.

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