Graphite's hold on battery anodes to be challenged by silicon, lithium metal

Graphite's grip on the anodes in electric vehicle batteries may loosen in the coming years, coming up against the energy density of silicon and lithium metal, and the rock-bottom costs of hard carbon, according to industry experts.

Graphite is used in the anodes of rechargeable lithium-ion batteries and is the largest part of the battery by volume. Graphite can be mined in its natural form or made synthetically using petroleum coke, coal-tar pitch or oil. However, the carboniferous material is often overshadowed by more expensive cathode components, including lithium and nickel.

The monthly price of US graphite imports averaged $1,860 per metric ton as of March 1, the most recent Panjiva pricing available. As of June 14, the lithium carbonate CIF Asia price was $48,000/t, 260.6% above the 2021 average price of $13,313/t, according to S&P Global Market Intelligence data. And the London Metal Exchange nickel cash price was $22,637/t as of June 14, 22.4% higher than its 2021 average of $18,488/t.

Battery-makers seeking to improve performance believe that silicon and even lithium metal in the battery anode can shorten charging times and increase energy density, thereby extending EV driving range, experts told S&P Global Commodity Insights. And sodium batteries using hard carbon in their anodes can undercut graphite on cost.

"The future of energy storage is not bleak," said Gao Liu, senior scientist and leader of the Applied Energy Materials Group at Lawrence Berkeley National Laboratory. "Overall, we can expect the energy density of batteries to steadily improve in the coming decade. ... In addition, we also have all of the many game-changing new chemistries."

Typical lithium-ion batteries have an energy density of 120 to 260 watt-hours per kilogram, according to the International Energy Administration's "Global EV Outlook 2023" report released in late April. The next big technology adoption will be a lithium-ion battery with a nickel-rich cathode and a graphite-silicon anode that will more than double the average energy density to approximately 300-500 Wh/kg by 2030, according to forecasts by IHS Markit.

Silicon has roughly 10 times more capacity to hold electrons than graphite and can improve energy density by 20%-50%, according to a report released by the International Energy Administration in 2021 and revised in early 2022.

California-based OneD Material Inc.'s silicon-graphite anode technology is 25% more energy-dense, Vincent Pluvinage, the company's co-founder and CEO, told Commodity Insights. This allows the user to recharge their EV within nine to 10 minutes if the battery is kept within the 15%-80% charge range. OneD Material trades as OneD Battery Sciences.

"The variable cost of silicon is less than $2 per kilowatt hour; the graphite is $7 per kilowatt hour. ... If you want to have a smaller, lighter battery without giving up range and higher energy density, there is no way to do that if you continue using graphite," Pluvinage said.

But silicon is known to significantly deplete a battery's lifespan due to swelling during charging, reducing the number of recharge cycles available.

"Car companies need to convince themselves that the [lifespan] is good enough to warranty the battery for [at least] eight years," said Venkat Srinivasan, director of energy storage research center ACCESS at the Argonne National Laboratory.

Both OneD and California-based Sila Nanotechnologies Inc. said they have overcome this hurdle through different forms of battery engineering.

"Here's the key: Shape matters," Pluvinage said.

OneD manufactures "graphite with little hairs of silicon attached" that allows the silicon to expand without sacrificing the battery's lifespan, the executive said.

Sila's nanotechnology increases energy density by 20%-40% and "allows expansion and contraction to occur within the particle, and so the outside world doesn't see this expansion," Kurt Kelty told Commodity Insights. Kelty is vice president of commercialization and battery engineering with Sila and was senior director of battery technology at Tesla Inc.

Some graphite anodes already contain some silicon, while a move toward more silicon-rich anodes is still in development and may come with higher production costs, which can more than offset lower raw material costs.

"You can go from a small percent of silicon mixed with graphite to 100% silicon," Jakob Fleischmann, a partner at consultant McKinsey & Co., told Commodity Insights. "Silicon nanotechnology is very costly ... and the startups that work on this first need to work on bringing costs down by orders of magnitude."

Sila's Kelty agreed, saying the company's all-silicon anode technology does cost more than graphite and that Sila's technology is only in consumer electronics. The company plans to begin scaling battery production for premium EVs starting in mid-2024, aiming to be cost-competitive with graphite by the latter part of the decade.

General Motors Co. signed a research development agreement in 2022 with OneD to potentially use the silicon-graphite anode technology in its Ultium battery cells, while Mercedes-Benz Group AG plans to incorporate Sila's silicon nanotechnology in its electric G-Class series by middecade.

"We'll continue to see more and more graphite silicon composites [of anodes] coming into the market over the next five, ten years," Rob Burrell, a senior analyst at Benchmark Mineral Intelligence, told Commodity Insights.

Richard Pearce, president and CEO of junior graphite miner South Star Battery Metals Corp., said the idea that battery innovation will remove graphite from the picture is "fiction."

"When people throw the phrase around — 'It's a silicon battery design' — it's still 90% graphite with some silicon doping," Pearce said. "Nothing will replace a graphite anode, and even your solid-state batteries still have graphite."

Hard carbon

In 2021, Chinese battery giant Contemporary Amperex Technology Co. Ltd. threw the EV market a curve ball by releasing a sodium-ion battery, which it plans to begin producing commercially in 2023.

The sodium battery uses hard carbon instead of graphite in the anode and would replace lithium with sodium in the cathode.

The technology significantly lacks in performance metrics, lowering energy density to 75 to 160 Wh/kg, according to the IEA's 2023 report. But sodium and hard carbon cost far less than any of the traditional battery metals, making the sodium-hard carbon battery technology a contender for stationary storage and economy cars in urban areas, analysts said.

"Now, does sodium-ion rule the world? ... It will very much depend on the lithium price," McKinsey's Fleischmann said. "But it's not only replacing lithium with sodium, it is a completely different cathode and anode system. Therefore, it will take a bit of time to mature."

A solid future

Battery anodes are expected to undergo an additional transformation at the end of the decade when solid-state batteries are forecast to hit the market. Solid-state batteries switch out graphite for lithium metal in the anode, increasing energy density by a whopping 70%, and eliminate the liquid electrolyte solution that separates the cathode and anode, according to the IEA's 2021 report.

Various companies are zeroing in on solid-state battery technology. Colorado-based solid-state battery start-up Solid Power Inc. has partnerships with Ford Motor Co. and BMW Group. California-based start-up QuantumScape Corp. is in a joint venture with Volkswagen AG and has begun shipping prototypes of its batteries to automotive customers. Nissan Motor Co. Ltd. plans to start pilot production of solid-state batteries in 2024 to produce EVs with the technology in 2028, and Toyota Motor Corp. aims to commercialize solid-state batteries by 2028.

But solid-state batteries will likely be expensive due to the challenges of engineering both sides of it so that the surfaces work well together.

"The only mandatory thing to achieve is that the additional costs that come with the solid-state batteries in the beginning are in kind of a good relation to the additional performance," Fleischmann said.

Despite the announcements of imminent production, Srinivasan warned that solid-state technology "is really lagging behind silicon" and is still in the research and development stage.

"I would say that solid state, or going to a lithium metal [anode], is good in the long term. Now, I'm talking 2040," Srinivasan said.

Panjiva is the supply chain research unit of S&P Global Market Intelligence, a division of S&P Global Inc.

IHS Markit is now part of S&P Global.

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