Written evidence from British Lithium Limited (BEV0016)



Batteries for electric vehicle manufacturing

Call for Evidence 14 February 2023

Research by British Lithium Limited is a UK company based in Cornwall. In 2018 we were the first to drill for lithium in UK, and discovered a major lithium resource in micaceous granite. We have developed and patented sustainable technology for extraction of lithium from granite and have built a £4 million pilot plant producing 99.8% pure, battery grade lithium carbonate. We plan a full-scale quarry, beneficiation plant and refinery on a brownfields site in Cornwall, producing 20,000 tpa LCE.

British Lithium is working to build out a local lithium battery supply chain, by providing the lithium required for LiBs. There is currently no battery grade lithium produced in Europe.


  1.                 Is there enough UK vehicle manufacturing demand in the UK to support gigafactories?

a)      Faraday predicts that seven 20 GWh gigafactories are required to electrify British vehicle production. Only one is under construction. The Chinese Envision AESC 12 GHh plant in Sunderland is dedicated to Nissan’s EVs.

b)      By comparison, European gigafactory capacity is 78 GWh and projected to be 1,100 GWh by 2030, with more than 40 plants expected to be open and producing.

  1.                 Will the UK have sufficient battery production supplies by 2025 and 2030 respectively to meet the government phase-out plans for petrol and diesel vehicles?

c)      Unlikely as no additional gigafactories are committed in UK, and Faraday Institution says battery gigafactories typically take at least five years to reach operational capacity.

d)      As matters stand, meeting the Government’s phase-out of ICE will require the large-scale importation of EV’s and significant decline of UK ICE car and engine manufacture. Already UK manufacture has fallen from 1.3 m in 2019 to 775,014 in 2022 (SMMT). In 2022 the two top selling cars in UK were the Chinese made Tesla Model Y, followed by their Model 3.

  1.                 Is UK-based battery production necessary to support the manufacture of electric vehicles in the UK?

e)      Yes.

f)        Due to the high cost of packaging and transporting LiB due to their weight and dangerous goods classification, LiB manufacture is generally co-located with EV manufacture.

g)      After 1 Jan 2024 tariff free export of EVs to EU requires 50% of the battery materials to be sourced in UK. As 40% of an EV cost is the battery, this means that the batteries must be made here.

h)      To reduce the dependence on imports from other countries and minimize supply chain risks

  1.                 What are the risks to the UK automotive industry of not establishing sufficient battery manufacturing capacity in the UK?

i)        In a worst-case outcome, with no large-scale UK battery production, domestic vehicle producers would continue to wind down their production of internal combustion engine vehicles, progressively eliminating the jobs of the 170,000 people directly employed in the UK automotive sector.

j)        For example Ford Motor ceased UK manufacture of their Transit van after 50 years, and will make the Transit-E in Turkey, where they are also building a co-located 45 GWh gigafactory.

  1.                 What other domestic end uses for batteries would provide a market for UK battery production?

k)      There is significant demand for LiB for grid-scale storage, and to replace standby diesel generators. According to the International Energy Agency in 2020, the UK had 1.3 GW of installed grid-connected battery storage capacity, making it the largest market in Europe. It's likely that the market size has grown significantly since then, as battery storage continues to play an increasingly important role in the UK's energy system. The UK has mandated zero carbon by 2050, which will require significant expansion of intermittent power sources such as wind, solar and tidal. These intermittent supplies will require large scale storage.

l)        Storage is needed for ensuring grid stability as large thermal generators are removed, and for balancing supply and demand throughout the day. utility-scale battery storage facilities have grown rapidly in the UK over the past few years to provide approximately a third of the storage power capacity available to the grid today. This growth is expected to continue through to 2050, reaching 190 GWh of energy storage capacity.

  1.                 Does the UK have a sufficient supply of critical materials to support vehicle battery production?

m)    Not yet. Faraday estimate that electrification of the UK’s existing car industry would require 70,000 tpa LCE. British Lithium’s planned development can contribute a significant share at 20,000 tpa. Many regions (such as China, EU and USA) are competing for scarce critical raw materials and are well ahead of UK. China currently produces 80% of global LiBs and was an earlier mover in securing ownership of CRM mines and supplies in Australia and South America. There is currently no battery grade lithium produced in Europe.

n)      There are two principal LiB chemistries both of which require lithium. Lithium Nickel Manganese Cobalt (NMC) and Lithium Ferron Phosphate (LFP). The UK has significant resources of lithium (in Cornwall) but no resources of nickel, manganese or cobalt. Consensus forecasts are a global requirement for 1.5 mta LCE whereas global production in 2021 was just 240,000 tpa. Meeting the growth in lithium demand would require some 50 new lithium mines and refineries to be discovered proven, developed and commissioned by 2030, which is unlikely to happen. Average time to develop a new, complex metallurgical mine and refinery is 10 years, so chronic shortages will continue.

  1.                 How ready are UK vehicle producers for the EU–UK Trade and Cooperation Agreement (TCA) rules of origin (ROO) phasing in from 2024?

o)      Sourcing battery materials from within the UK or EU will be the only realistic option for UK carmakers to avoid EU tariffs from 2024 onwards. Achieving this will depend on the development of British Lithium’s quarry, beneficiation plant and refinery in Cornwall.

  1.                 What can the UK learn from investment in other countries in the establishment of gigafactories?
  2.                 Do we have the skills in the workforce required for the production of batteries? If not what needs to be done?
  3.             Will the cost of UK batteries be competitive compared with batteries produced elsewhere?
  4.             What impact will the European Union’s proposed Carbon Border Adjustment Mechanism have on UK production?

p)      If implemented, the CBAM would impose a carbon tax on imported goods based on the carbon emissions generated during their production, including lithium batteries.

q)      If UK's battery production is less carbon-efficient than those of its competitors, its battery production may become less competitive due to the added costs imposed by CBAM. This could reduce the demand for UK-made batteries and make it more difficult for UK battery manufacturers to compete with their international counterparts.

r)       On the other hand, if the UK has a lower carbon footprint compared to other countries, it could benefit from the CBAM by being able to sell its batteries at a competitive price, which could increase demand for UK-made batteries.

s)      Manufacture of LIBs is very energy intensive. The carbon emissions from battery manufacture can be 29% of the emissions of manufacturing an EV (Polestar LCA 2020)

t)        A major factor determining location is availability of renewable power. The UK has a high mix of renewable power already which gives it a potential competitive advantage. Britishvolt chose its site based on the availability of connection to Norwegian hydropower, and Northvolt chose Sweden due to availability of hydropower.

u)      British Lithium is proposing 20,000tpa LCE production in Cornwall, which will be the world's only co-located quarry/beneficiation/refinery where there are no emissions from transporting concentrate. The Cornwall grid is already 40% renewables, which gives us a competitive advantage in terms of carbon emissions over the dominant Australian lithium producers. In fact, a major independent Benchmarking report revealed that British Lithium’s carbon emissions will be the lowest of any hard rock lithium producer, and less than half the average.

v)      The UK has made significant progress in increasing its use of renewable energy in recent years. In 2020, renewable energy sources, such as wind, solar, and hydropower, accounted for over 40% of the country's electricity generation.

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