EV Batteries Have a Heavy Carbon Footprint, Procurement Can Help

With zero tailpipe emissions, electric vehicles (EVs) have an incredibly low carbon footprint once in operation.

But it’s worth repeating those last three words again: once in operation. 

A 2021 Reuters study pitted a Tesla Model 3 against a Toyota Corolla to discover the break-even point where the EV becomes less damaging to the environment than the ICE (internal combustion engine vehicle). The results raised eyebrows:

• A Tesla charged entirely by renewable energy hits the break-even point at 8,400 miles.
• A Tesla charged with the average US energy mix needs to travel 13,500 miles before breaking even.
• A Tesla charged entirely with coal-fired power (this is becoming rarer) needs to travel 78,700 miles to break even.

The carbon footprint of EV batteries

There are a couple of points to unpack here. The first is well-known: an EV’s cleanliness is highly dependent on the energy mix used to charge it. At present, around 60% of our national grid is powered by fossil fuels, 18% from nuclear power, and 22% from renewables.

It really depends on where you live. Driving a Tesla in California is way cleaner than doing the same in, say, West Virginia, Missouri, Wyoming, or Kentucky, all of which rely on coal for over 70% of in-state generation.

But the energy used to charge your vehicle is only half of the story. What about the energy mix used to manufacture the battery.

Embedded emissions

EVs begin their life – fresh off the factory floor – with much higher embedded emissions.

Without a battery, an EV body and an ICE body are fairly similar (between five and ten tons of CO2e emissions). The ICE has slightly higher embedded emissions simply because it has more bits and pieces in its engines.

But add the battery to the EV, and the story changes. A typical EV with a 75-kWh battery emits an additional seven tons of CO2e emissions, dwarfing the emissions of the factory-new ICE vehicle.

It begins with the materials. EV batteries typically contain:

• Nickel 15.7%
• Aluminium 18.9%
• Manganese 5.5%
• Cobalt 4.3%
• Lithium 3.2%
• Graphite and other materials 52.5%.

Mining and refining all of these emit bucketloads of greenhouse gases, while producing anode and cathode materials is also energy-intensive due to the need for high temperatures. 

Again, embedded emissions depend strongly on the local energy mix. Looking at the global picture, you can see that Sweden (with an electric grid nearing zero emissions) is producing way cleaner batteries than the rest of the world.

With its largely coal-powered manufacturing muscle, China immediately stands out as having the most emission-intensive production processes for batteries. Chinese EV and battery sales are negligible in the USA (thanks to a quadrupling of tariffs), but it’s important to note that China has a global EV market share of around 70%. Like the USA, however, China is slowly decarbonizing its grid, so this dirty battery situation is likely to improve. 

Right now, the cleanest batteries may come from Sweden, but shipping them over here with fossil fuel-burning ships and trucks raises their embedded emissions profile.

There’s also a human toll. Booming demand for Indonesian nickel is ravaging the environment, lithium extraction is evaporating water in South American salt flats and displacing local communities. Cobalt sourced from the Democratic Republic of Congo is notoriously unregulated, with kids as young as six working in dangerous, airless mines.

The good news: procurement can slash embedded emissions in EV batteries.

One of the best sources of information on this topic is a report by McKinsey titled The race to decarbonize electric-vehicle batteries. Here’s the part that caught my attention:

Here are some of the ways procurement can help through sustainable sourcing decisions.

Raw-material extraction and refining

• Mining and refining raw materials account for about a quarter of total battery production emissions, with lithium and nickel responsible for more than half of that.
• Emissions of battery-grade nickel can vary by a factor of 10, depending on location, ore type, and processing technology.
• Procuring metals from sustainable producers, such as those using electrified mining equipment or renewable energy sources, can reduce emissions by up to 30% per battery cell.

Active-material (Anode and Cathode) manufacturing

• Most emissions come from high-temperature processing, where boilers and electricity are used for material precipitation, drying, and heat exposure.
• Switching to a clean power purchase agreement (PPA) with 100% matching of supply and demand can reduce up to 25% of total mine-to-cell manufacturing emissions.

Cell manufacturing

• Electrifying the production process, particularly the electrode-drying step, can significantly reduce energy consumption and related emissions.
• Innovations like dry coating or switching to water-soluble binders can also curb energy use and emissions.
• Supplying a completely electrified cell manufacturing process with 24/7 low-carbon electricity can result in a 25% reduction of total mine-to-cell manufacturing emissions.

Using production-adjacent factors to reduce emissions

• Recycling can decrease the carbon footprint of battery materials by a factor of 4 compared to virgin raw materials.
• Decarbonizing the transport sector and localizing the battery value chain can reduce logistics-related emissions.
• Choosing battery chemistries with lower embedded emissions, such as lithium-iron-phosphate (LFP) over nickel-manganese-cobalt (NMC), can result in a 15-25% reduction in carbon emissions.
• Rethinking battery sizes to better match consumer needs (keeping in mind the average commute is only 42 daily miles) can optimize the use of limited resources and further reduce emissions.

You’ll note that in McKinsey’s report, low or zero-emission electricity is repeatedly identified as the number-one lever to pull to drive down those embedded emissions. And it’s happening: GM, which produces the Ultium battery system, has finalized energy sourcing agreements to supply all of its US facilities with 100% renewable energy by 2025. 

So, if you’re in the EV battery game, it’s time to take a closer look at the energy you are sourcing and get to work on pursuing a clean power purchase agreement.