A company spun out of the Dalhousie University lab of lithium ion battery pioneer Jeff Dahn a decade ago, is doubling down on its battery materials business, as automakers and cell manufacturers scour North America for local anode and cathode suppliers.
Novonix Ltd., which was founded in 2013 as a battery testing company, announced a joint development agreement with battery cell maker LG Energy Solution (LGES) on June 6.
The deal focuses on the development of high-performance artificial graphite anodes, and is geared toward positioning Novonix as a key supplier to the cell maker’s growing roster of battery plants in the United States and Canada. It gives LGES the option to purchase up to 50,000 tonnes of anode material from Novonix over 10 years, following the completion of the collaborative development work.
The anode accord with the big-name battery maker is just the latest milestone in Novonix’s expansion into battery materials production, which comes as North American demand swells, said company CEO Chris Burns.
“The market needs these materials yesterday,” he told Automotive News Canada.
Graphite, a highly conductive form of carbon made up of neatly layered sheets of atoms, is commonly used for the negative electrode, or anode, in lithium ion batteries. It is naturally occurring, so can be mined, but higher performance anodes use artificial, also known as synthetic, graphite.
“Natural graphite starts as graphite, and you need to purify it. Synthetic graphite starts as something else, [such as petroleum coke,] and you have to heat it up to convert it,” Burns said.
Novonix has been fine-tuning its artificial graphite anode production process over the past five years, and is scaling up output in the United States to fill the void in local suppliers. As with many other battery materials today, the majority of the electric vehicle market’s graphite supply comes from China.
At the company’s first commercial production site in Chattanooga, Tenn., Novonix plans to be producing at least 10,000 tonnes of anode material per year by the end of 2024. This will match the requirements of another of its customers, Kore Power, a battery startup building a cell plant in Arizona.
And as Novonix lines up other prospective buyers, such as LGES, it is working to build a series of other anode plants to add capacity in roughly 30,000-tonne “increments,” Burns said.
“Our goal is to be generating hundreds of millions of dollars in revenue on an annual basis from the anode materials side in the next two to three years,” Burns said.
The company is still scouting locations for the first of its 30,000-tonne plants, but it will be in the United States, and built with the assistance of a US $150 million grant awarded to the company by the U.S. Dept. of Energy last fall. It’s scheduled to come online in 2025.
Other plants are expected to follow, which Burns said could eventually lead the company’s anode unit to Canada, where access to clean, cheap power is a major draw.
'HUGE OPPORTUNITY' FOR CANADA
“The large amounts of support from the U.S. federal government really are driving investment there, but Canada has a huge opportunity to bring a lot of that investment in the next wave.”
It would be relatively familiar territory, as the other half of Novonix’s business is already based in the Halifax area.
Today, the company employs about 200, split more or less evenly between Canada and the United States. Despite the singular focus on North America, however, Novonix is officially headquartered in Australia. The faraway base of operations is a holdover from the company’s 2017 merger with Brisbane-based junior miner Graphitecorp Ltd., a transaction Burns said was aimed at raising the capital needed to push into the anode business.
While the company’s U.S. operations focus on artificial graphite production, its Canadian unit remains mainly concentrated on battery testing equipment, the segment that gave it its start.
Based off early research Burns conducted alongside Jeff Dahn in the late 2000s, the company uses a system known as ultra-high precision coulometry to put batteries through their paces. The testing process lets Novonix precisely extrapolate how well batteries will hold up over hundreds or thousands of cycles, and when they will fail.
“We work across the entire sector and support everything from startup companies you’ve never heard of, to household names through our labs in Halifax,” Burns said.
Particularly for electric vehicle batteries that can last for 10 years or more, the testing process is vital, Burns said, as cell makers need accurate long-term performance data, but can’t wait a decade for real-world results. Novonix’s testing equipment compresses the process down to about a month.
As its testing business continues to grow, Novonix is also funneling the profits back into R&D, which has led to a possible foothold in a different segment of the battery materials business.
In Halifax in November, the company opened a 35,000-square-foot plant dedicated to piloting a new type of cathode material production process. It uses a dry, as opposed to wet, processing method, significantly cutting down on waste. The site can produce 10 tonnes of cathode material per year.
The new cathode production process is still short of commercial-readiness, but if proven out at the pilot-scale, will present another growth area for the business, similar to the opportunity it’s currently exploiting on the anode side, Burns said.