The demand for lithium will not stop increasing in the coming years, as electric vehicles continue to gain popularity around the globe and especially in Europe, China and the United States. In this context, one of the concerns of manufacturers is to ensure the supply of sufficient lithium to meet their production targets, although another issue cannot be ignored: the sustainability of the supply chain. In this sense, three companies want revolutionize industry through a much more environmentally sustainable method of obtaining lithium.
Currently 70% of the lithium that is extracted is used in batteries. As sales of electric vehicles increase, there will be a greater need for this precious material, without which batteries cannot be manufactured with current technology (which, with modifications, will continue to be used in the medium term). According to an analysis by Benchmark Mineral Intelligence, the lithium industry needs an investment of 40,000 million euros between now and 2030 to meet the demand for this raw material for electric car batteries.
Searching for new deposits where to obtain lithium is the search for oil of the new times. About 65 kilometers north of the border between California (United States) and Mexico is the Salton Sea, which could become one of the largest reserves in the world. Increasingly drier, smaller and without access to the sea, the continuous periods of drought and the poor management of water resources in the area have made this lake go from being a tourist center and with an important ecosystem to a zone lifeless. Although that could take a 180 degree turn.
As the edges of the Salton Sea recede, pools of lithium rich brine on the lake bed. Michael McKibben, a geochemist and research professor at the University of California Riverside, is leading a study that is looking at lithium resources in the area. According to McKibben, the Salton Sea could become one of the largest lithium brine deposits in the world. Using a conservative approach, they estimate that there may be 1 million metric tons of lithium metal dissolved in the brines; a more optimistic one raises that figure to 6 million tons. With those data, the lake’s resources could produce between 5 and 32 million metric tons of lithium carbonate.
Lithium extraction is normally carried out in open pit mines or in evaporation ponds. The latter work by pumping lithium-containing brine to the surface and waiting for the water to dry, to then get the lithium. Both methods take up a lot of land, usually require a large consumption of water and generate a large environmental impact. But in the Salton Sea there is three companies that are developing a process to obtain lithium in a much more sustainable waycleaner, taking advantage of the geothermal resources from the lake.
Near the lake there are currently 11 geothermal plants in operation, of which 10 are owned by BHE Renewables, the renewable energy division of Berkshire Hathaway. According to Alicia Knapp, President and CEO of BHE Renewables, they are currently pumping 189,270 liters of brine per minute to the surface among the ten geothermal plants they own in the area. The company uses the steam from the brine to generate electricity cleanwithout carbon dioxide emissions.
Geothermal plants pump brine from underground and use the steam to generate electricity. They then re-inject the brine into the ground. The goal now is to add another step to that process and extract the lithium from the brine before re-injecting it back into the ground. Two other companies, EnergySource and Controlled Thermal Resources (CTR), are also developing geothermal and lithium facilities in the Salton Sea. The names may not sound familiar, but CTR has struck deals to be one of General Motors’ lithium suppliers.
Higher extraction costs
CTR is the only one of the three companies that does not have its own geothermal power plant in the area, but is already building geothermal and lithium recovery facilities. It is currently building a demonstration plant and plans open its first large-scale plant in 2024, which will allow it to supply 20,000 tons of lithium to General Motors. The company estimates that its first plant will cost just under 1,000 million dollars, which would leave a cost of 50,000 dollars per tonne in a first phase, higher than that of other conventional lithium exploitations.
It is not the most profitable method in the industry, but the rise in the price of lithium is encouraging projects like this, which previously could not be profitable at all. “What we see in terms of production costs is that geothermal brine should be around the top quartile in terms of competitiveness in the market,” according to Derek Benson, CEO of EnergySource. The three companies expect that price to drop as the technology develops.
At full capacity, the Salton Sea field could supply more than 600,000 tonnes a year, according to Rod Colwell, CTR’s managing director. Total world production is currently less than 400,000 tons. For its part, the California Energy Commission estimates that the Salton Sea has enough lithium to meet all projected future US demand and 40% of global demand. The potential of this deposit is enormous and could represent a significant economic boost for the area, which currently has an impoverished population fueled by high unemployment rates. It will also be able to revitalize a region that has experienced an exodus of population to other places with better opportunities in recent years.
There is, however, a problem and that is lithium extraction from geothermal brines has never been used on a large scale, so it is a method for which there are no guarantees about its economic and industrial viability. Although there have been attempts to use this method in the past, it has never been developed on a sufficient industrial scale. If they manage to carry it out, it could generate huge profits for the three companies in question, in addition to representing an important leap for the automobile and battery industry -especially the US- as well as for the local community.
refine lithium on-site for greater control of the supply chain
There is another end to tie in this matter: the refining of lithium. Although most lithium deposits are in Australia, Chile and Argentina, currently most lithium is shipped to China for refinement. The refined lithium is then shipped to other parts of China itself, Japan or South Korea for chemical processing and cell production. Batteries can be assembled in Asia or shipped to the United States or Europe.
However, the three companies plan to refine lithium on-sitein the surroundings of the Salton Sea itself. This allows the United States control more of the supply chain, a key factor to take into account both economically and geopolitically. Furthermore, by refining lithium on-sitethe carbon emissions associated with the transport of said lithium around the world are reduced.
However, the companies are not prepared to deal with the next steps, such as the chemical processing of lithium carbonate or the manufacture of cells, which will continue to take place mainly in Asia. Let us remember that China, South Korea and Japan account for more than 90% of the world’s production of batteries for electric vehicles. The goal, according to Alicia Knapp, is for the supply chain to develop in the United States in the coming years “so that we can go directly from lithium and other minerals (…) to the batteries we use.”
The project generates enthusiasm and caution among local political leaders. “We are cautious because we don’t want to get our hopes up,” says María Nava-Froelich, mayor of Calipatria (California), the city where the geothermal plants are located. “We see it as a game changer,” she says, not without leaving a small gap for mistrust: “All this talk, is it really happening or are they just talking about it and maybe they’ll back off and go somewhere else? It’s almost too good to be true.”
