Everyone knows about lithium, and about how it’s used in batteries for almost every electronic device, but lithium is only part of the story.
Today we’re talking about graphite and my guest is John DeMaio, CEO Graphex Technologies and President of Graphene Division of the Graphex Group Ltd.
Anthony Day: John, welcome to the Sustainable Futures Report.
John DeMaio: Anthony, it's a pleasure to be here with you.
EV Battteries
Anthony Day: Okay, now I learn that your organisation is amongst the top 10 producers of graphite for electrical vehicle batteries. Now, I didn't know that graphite was used for anything apart from pencils, and suddenly I find it's in EV batteries. EVs are the way to sustainability for a lot of people.
So clearly this is very important and fits right in with the Sustainable Futures Report. Just tell us more about how graphite features in these products.
John DeMaio: Yeah, you bet. That perception is pretty common, Anthony, quite frankly, starting with the fact that electric vehicle batteries are normally referred to as lithium-ion batteries.
Lithium-ion
Lithium-ion batteries have been in existence since about the seventies, right? From the first gas crunch, if you remember back then. Since then, the chemistry has been consistent – and graphite is essential to that basic battery configuration.
Without getting too far into the weeds, you have two electrodes, a positive and a negative, referred to as the cathode and the anode. And a lot of the attention with the electrification movement has been on the cathode side ,where you have elements like lithium, cobalt, nickel, manganese, et cetera.
Anode
What people don't realize is that the other electrode, the anode, which is equally important, is comprised almost entirely of graphite. 95 to 99% of that anode is graphite. And there could be a combination of synthetic and natural, which we'll talk about, and then some additional elements like silicon oxide, et cetera.
But again, the anode side of the battery is predominantly graphite. And let's face it, an electric vehicle is mostly about the battery, right? In a lithium-ion battery, you can have 15 times more graphite than lithium. And in fact, graphite makes up about 25% of the total volume of the battery.
So graphite is the largest component by volume in a lithium ion electric vehicle battery. And a lot of folks don't really understand that or recognize that because graphite goes about its business, doing its job quietly, like its done ever since the seventies. It’s a natural product most people associate with lead pencils, lubricants, et cetera.
But it plays a very important role in the electrification movement and, as you mentioned, the whole sustainability movement. So it's very exciting for being just plain graphite.
Anthony Day: Graphite is a natural material. It's dug out of the ground. It needs to be purified. So what do you have to do to put it in a form where it can actually be added into a battery?
Purification
John DeMaio: Yeah, you bet. So, there's a shaping, purification, and coating process that imparts the qualities that make it desirable for use in electric vehicles. Graphite in its raw form is inert, stable, et cetera. But we do the refining process. As you mentioned, it needs to be purified to almost 100%, really 99.95% carbon, then shaped into a form as close to spherical as we can – think small potatoes, microscopic potatoes - and then coated to control the expansion and contraction of when it's put under charge and discharge.
So it goes: shaping through a series of milling processes, purifying through a chemical (acid and base) stripping process, then coating with a microscopic layer of, typically, asphalt. Together, the process creates these microscopic particles that perform the way the battery chemistries need.
Anthony Day: I see. Now you mentioned that apart from lithium and graphite, there are a number of minerals which are involved in batteries, and I think we're aware that quite a lot of them are very rare, and there's a lot of conflict about how they're sourced. What's the picture, as far as graphite is concerned?
Rare Earth
Is it rare? Difficult to find?
John DeMaio: it's a great question. So it's both, right? It’s rare from the standpoint that there are currently not a lot of producing graphite mines. Historically it has not been mining’s most profitable venture. So, for all of the capital, regulatory navigation, etc. required, miners would probably choose other, more lucrative metals: gold, lithi et cetera.
But graphite’s positive point is that it's very abundant on the planet. There are multiple deposits of graphite all around the world. They just have not yet been tapped in any large-scale volume. That's starting to change because of the demand that electric vehicles represent for graphite. Because, as I said, graphite is a major component in the lithium-ion battery.
China, US, Canada
Historically, most of the graphite used in the battery environment has come from China. The world’s largest current graphite deposit is up in the northeast province of China. And that has provided 70 or 80% of all graphite for years.
But now, we have geopolitical concerns, right? As Yogi Berra would say, the world has become very global. There is need for more diversification of that upstream supply. And we as a company are exploring relationships with other sources of graphite, everywhere from southern African countries to Australia, Canada, even Ukraine.
And right here in the US there's limited supply, but there is some graphite that can be made available in the coming years.
Anthony Day: Right. Yes, of course. The fact, that there's some in Canada caught my eye because that's on your doorstep really, isn't it?
John DeMaio: Absolutely. And obviously, it’s a friendly nation – very experienced in mining and actively engaged in the vehicle electrification movement, particularly in the province of Quebec. Like we see in the U.S. right now, there’s a lot of good alignment between legislation funding, political will and, and industrial will.
End to End
Anthony Day: Now it says in one of your press releases that your organisation's objective is to create an end-to-end graphite processing and production capability in North America. Are you looking to be totally vertically integrated so that you start with a mine? What are the other stages in the supply chain towards your final customer?
John DeMaio: Actually, no, not the mining. We believe in sticking to your knitting, so [00:08:00] to speak. We have over a decade of experience in graphite refining, which I always reference as part art and part science. The way I described it earlier - milling, purifying, coding - sounds fairly simple.
In some ways, it's not rocket science. However, there is a lot of technique and know-how associated with the process. We produce 10,000 metric tons of microscopic particles delivered to a very exacting specification. When you're doing so on a continuous basis, you need to have a significant amount of experience and know-how. We spent a couple of years in the development stage before we went commercial, and since then, we’ve had 10 years of experience in that realm.
So when we talk about end-to-end for ourselves, we're talking about taking graphite from mine output to battery delivery. But when we talk about end-to-end from the OEM's perspective, that includes the mining. Rather than vertically integrate and get into the mining business ourselves, we're aligning with experienced players on that side.
Anthony Day: Right.
Joint Ventures
John DeMaio: You've seen announcements about offtake agreements; that's fairly straightforward. We're also exploring some potential joint venture arrangements with mining operations so that together we can represent what we call an industry solution, which is again, from mine to battery with experienced players at every step along the way so that we can hit the ground running, in this domestication push. And when you really think about it, Anthony, as a society, particularly North America, we're looking to replace over a hundred years of internal combustion technology with electric, and domesticate that technology at the same time, right? So that's a huge task.
Anthony Day: Yeah.
Infrastructure
John DeMaio: And that task entails a lot of infrastructure, even aside from the battery production and charging, which is necessary as well. To bring that infrastructural capacity online quickly, we believe that we need experienced players, ready to plug and play and do what we've already been doing for ten years.
All we're going to do now is replicate that experience here. That's the quickest way to build out this electrification muscle.
Europe
Anthony Day: You are undoubtedly providing your product to US manufacturers. Are you exporting to Europe as well?
John DeMaio: Not yet. In fact, we're not yet in production in the US. We've announced our plant in Michigan; that's probably about 50% along the way. We recently announced that we received our environmental permit. Now, it's a question of getting final design equipment to order, et cetera.
The industry is moving; it's still finding its level, if you will. It’s a paradigm shift for the automotive industry. There’s not an existing manufacturing base, so it all must be built. So, our first push will be here in North America - the US, possibly Canada - and then onto Europe.
Graphene
Anthony Day: Now, turning in a slightly different direction, your title is President of Graphene Division. Graphene to me, I believe, is an incredibly thin sheet of carbon, one atom thick. Right? What's the application for that?
John DeMaio: Yeah, so graphene's one of those terms that does get - not misused, but when people hear it, they think of what you're talking about, the single-atom-layer sheet of material that has superhuman properties: transparent, incredible conductor, 200 times harder than steel, et cetera. That particular application is very difficult to produce, and right now there's not an established, commercial marketplace for it.
Graphene also refers to the single atomic layer of graphite that surrounds each particle in the electric vehicle battery. The electrons that enable battery charge and discharge are stored in the graphene layer of those particles. So that's what we refer to as the graphene layer, for practical purposes; we do have R&D for applications of those single-layer graphene sheets, but we're focused primarily on the production and refinement of graphite for electric vehicle batteries and battery energy storage.
And let's not forget that the electrification movement has a huge need for storage. It enables renewable energy to be accessible in off-peak or off-production timelines, right? That's always been the knock against renewables. The wind blows at night; we need power in the day. Sun shines during the day; we need power at night. Batteries level out those curves.
Anthony Day: So, graphite is required in all sorts of batteries, not just those going into EVs.
Batteries are the Future
John DeMaio: It is. All manner of electrification requires batteries, and batteries require graphite. Even hydrogen fuel cells, if they become the next evolution of transport, involve a battery in their ecosystem. There's no getting around it that batteries are part of this electric future.
Anthony Day: Well, we've got a challenging future if we are going to electrify the whole population of global motor vehicles. We really have. We’ll see tremendous supply chain challenges. From what you are saying, though, graphite is not going to be a limiting factor. You are there to meet the demand.
John DeMaio: Ultimately. Not right now. Think about automakers’ recent gigafactory announcements. A quick rule of thumb is that a 25 Gigawatt hour factory will require about 20 to 25,000 tons of graphite in support. So when you look at the outlook for gigafactories in North America, you have anywhere up to a terawatt in projected factory capacity. That number translates to somewhere between 500,000 tons to a million tons of graphite required. And the current capacity to refine that graphite in, in North America is zero on a commercial scale. So, the opportunity to build out that infrastructure is enormous.
Full Production
Anthony Day: While you were talking about your own facilities: how soon can you gear them up to full production?
John DeMaio: We believe we can get the Michigan plant up in the next nine to 12 months. That plant will deliver 15,000 tons, which is appreciable, but it makes barely a dent in upcoming demand.
So, we're simultaneously looking at locations. In fact, we have an announcement out there with our partner, Northern Graphite, looking at a site up in Quebec that could support 100,000-200,000 tons of production. We're looking at several other locations around the lower 48 for projects on a similar scale.
Tackling this demand picture one plant at a time will probably not be the answer. We think a better way to address the issue is what we call “flex factories,” which build out capacity in increments based on the timing of the demand that comes online. That way, as gigafactories get built, we can build out support or production to meet that demand. But we're looking for locations that can house these larger production facilities.
Betting on EVs
Anthony Day: Do you ever think there might be a risk to betting on electric vehicles? In other words, could we perhaps see fundamental changes?
Maybe because the electricity infrastructure simply cannot power all those vehicles. Maybe because there's a move towards, 15-minute communities. I don’t know if you've heard of them, but the idea is that they’re communities where everything is within a 15-minute walk or cycle ride, therefore reducing motor vehicle demand.
There are different scenarios, but you're happy to bet on the EV, are you?
John DeMaio: Well, we're not just betting on the EV. EVs represent the most obvious and immediate battery demand. But the move away from fossil fuels is a one-way trip. People can argue that we'll never move a hundred percent away from fossil fuels, and that may be true, but for a sustainable future, I think that electrification is the way to go, whatever the technology. Solar, nuclear – people may argue what technology is best. But we do have solar and wind available today and other renewables being developed. I've been in this space for 30 years. So, I've seen a lot of these technologies and they keep getting better. Electrification is happening. Electric vehicles may take a, a different role in the future, but electrification is happening. Electrification equals batteries. Batteries equal graphite. So we're comfortable in our role, The question you asked might be a better one for the electric vehicle manufacturers.
We're bringing a basic element to the electrification movement and right now that's focused a lot on electric vehicles. But like I said, energy storage will be a more dominant player as we move ahead.[00:20:00]
Exciting Times
Anthony Day: Well, come what may, I think we agree. We live in exciting times.
John DeMaio: For sure. I's very exciting for a guy that's been in the energy transition before it was even called that. I was working on concentrating solar out in the Mojave Desert back in the eighties, with the molten salts and all that.
It’s always been like pushing a rock uphill: we knew sustainability was good for the environment and good for the planet, but getting it adopted was a challenge. It had to make financial sense, and there was a lot of pushback against it. Finally, we're crossed the Rubicon, I would say.
Anthony Day: Mm-hmm.
John DeMaio: On this electrification movement: ot's finally been accepted that we really need to do it. We must move ahead from the fossil fuel past. So now we're seeing legislation, political will, societal will - legislation resulting in funding, funding resulting in action. So, it's a very exciting time for a guy like me and probably like you, that we are finally moving forward. There will be bumps along the way, but we've seen that before. We've seen fits and starts and stops. Now it seems like the momentum will carry the day.
Anthony Day: John DeMaio, thank you very much for sharing your ideas with the Sustainable Futures report.
John DeMaio: You bet. My pleasure, Anthony. Anytime.
That’s John DeMaio, CEO Graphex Technologies.
Before I go…
Just Stop Oil
… there's another story about Just Stop Oil. At the weekend former Chancellor, George Osborne, got married and a smartly dressed lady walked up to the happy couple as they left the church and showered them with orange confetti. This caused an outcry amongst the usual suspects blaming Just Stop Oil, and Priti Patel went so far as to call them lowlife. Just Stop Oil responded by saying that they had no idea who the lady was and she was certainly nothing to do with them. Nevertheless, they were delighted with all the publicity that she generated for them.
Royalty and the Environment
This week President Biden visited King Charles to talk about the climate emergency. In a week when the Energy and Climate Intelligence Unit reports that some 26% of Members of Parliament, (44% Conservative), do not understand basic climate science, let's hope that their conversation will be shared with our legislators, starting with the prime minister. Apparently many MPs believe we can stop climate change without achieving net zero.
Another topic for another day.
Well, here we are in July, still going strong, and there will be another episode next week, although I am looking forward to a break in August. Even then I may bring you some more interviews.
Thank you for listening,
Thank you for your support, especially if you are a patron, and thank you for your feedback and ideas.
I'm Anthony Day.
That was the Sustainable Futures Report.
Until next time.
Sources
Energy and Climate Intelligence Unit Report
https://eciu.net/media/press-releases/2023/mp-poll-wrong-on-public-support-for-onshore-wind-and-dont-understand-basic-climate-science
Graphex
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