Swedish battery maker Northvolt has developed a new sodium-ion cell technology and could ramp up production of batteries in the next few years.
The demand for critical minerals such as lithium, cobalt and platinum has surged in recent years as electric vehicles (EV) become increasingly popular, prompting car manufacturers and battery makers to look for alternatives.
Northvolt’s sodium-ion batteries do not contain lithium, cobalt and platinum, which can pose cost and environmental challenges.
“Sodium-ion batteries are not new … it’s been talked [about] and being developed for a period of time,” Peter Carlsson, Northvolt’s chief executive, told The National.
“But what we have managed to achieve with this product … it’s really high performance and the highest energy density so far that we have seen on the market.”
Northvolt’s sodium-ion cell has an energy density of 160-watt hour / kilogram (Wh/kg), compared to lithium-ion battery’s 180–250 Wh/kg.
A high-energy-density battery lasts longer and delivers the same energy in a smaller footprint compared to a lower-energy-density battery.
The company will engage in more product development and in defining an “efficient” manufacturing blueprint as the new batteries would be manufactured in Northvolt’s current factories, Mr Carlsson said.
Northvolt could ramp up the production of the batteries in the next few years following the completion of the development phase, he said.
“If you take a 10-year perspective, I think this has the opportunity to, volume wise, be as big as the [company’s] current portfolio of high-performance nickel batteries [and] potentially even more,” he said.
Northvolt, which mostly supplies lithium-ion batteries to car makers, is preparing for an initial public offering in Stockholm that could value the company at more than $20 billion, Reuters reported earlier this year, citing sources.
It has secured more than $55 billion worth of orders from customers such as BMW, Scania, Volvo and Volkswagen.
Sodium-ion cell is also more heat resistant than lithium-ion batteries, making it ideal for smart grids in large cities as well utility-scale solar projects, Mr Carlsson said.
That also means Northvolt could supply its batteries to countries in the Middle East and North Africa region, home to many large renewable energy plants.
“I think it [sodium-ion cell] opens up expansion for both building manufacturing capacity as well as larger deployments in the region and we are just starting conversations around this,” Mr Carlsson said.
“In the light of the big aspirations in the region towards green transition, we think it is a very interesting market.”
GCC countries have been investing heavily in renewable energy and sustainable development in a bid to diversify away from hydrocarbon exports.
The UAE, the first country in the Mena region to announce a target of net zero by 2050, has been funding clean energy projects, including solar and wind, as it cuts down on the use of natural gas for electricity production.
Saudi Arabia, which plans to achieve net-zero carbon emissions by 2060, is focusing heavily on building its domestic EV market to support the transition and develop its local manufacturing sector as part of its Vision 2030 strategy.
“We will follow where we clearly see there is a build-up of demand. Obviously, as the region is also building up an ecosystem, that is very interesting,” Mr Carlsson said.
In September, Northvolt announced that it would open a $5.2 billion gigafactory in Quebec, which is expected to become operational in 2026.
North America, which has car brands such as Tesla, Ford and General Motors, is the third-largest EV market in the world behind China and Europe.
However, the US Inflation Reduction Act (IRA) enacted last year has prompted several clean energy companies to expand in the region, driven by subsidies and cheaper energy.
“It was very important in our decision-making to invest in scaling up in North America,” Mr Carlsson said.
“Establishing this industry requires a lot of capital and it also comes with pretty big start-up costs. North America with the IRA kind of found an incentive formula that really supports that, and it’s been pretty effective if you see how much investment and activity it has generated.”
Northvolt’s announcement comes against the backdrop of a rising geopolitical rivalry between the US and China in the pursuit of critical minerals.
“The uncertainty [regarding] where the whole world is going is of course creating very high raw materials fluctuations, and that is never good because it prevents long term planning,” Mr Carlsson said.
The increasing “polarisation” of the world is prompting each region of the world to develop its own EV supply chain and it would have “happened anyway” as car makers follow “just-in-time” manufacturing, where inventory levels are kept as low as possible to reduce costs, he said.
Meanwhile, global electric car sales are set to surge by 35 per cent this year, helped by government subsidies and the tightening of carbon dioxide emissions standards, according to the International Energy Agency.
Electric car sales are projected to reach 14 million in 2023 from 10 million last year, the Paris-based agency said in its Global Electric Vehicle Outlook in April.
Electric vehicles will make up about half of the new car sales worldwide by 2035 as the push for net-zero carbon emissions accelerates, according to Goldman Sachs Research.
Updated: November 21, 2023, 5:00 AM
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