Lithium – Given the high demand and rising prices, Tesla is considering building a lithium refinery in Texas. In this way, the company wants to ensure the supply of the key component for its batteries in electric cars. CEO Elon Musk had already announced this step in April should lithium prices continue to rise.
“license to print money”
The potential lithium refinery will “process raw material into a condition usable for battery production,” the company said in an application filed Aug. 22 in Texas. Construction could start in the fourth quarter of this year, and production could start at the end of 2024 – subject to the necessary permits. In Texas, according to Reuters, Tesla would also benefit from local property tax relief and low labor costs.
The Tesla CEO has therefore spoken out loudly for the need for more players in lithium mining: “You can’t lose. It’s a license to print money.” The company’s own refinery is to be built on the Gulf Coast and the end product is to be delivered to Tesla’s various battery factories by truck and rail.
Demand for lithium – criticism of mining
The increasing demand for lithium is sparking great interest among mining companies worldwide – including in Germany. The German Lithium GmbH uses test drilling to determine the thickness and the lithium content in Zinnwald in the Ore Mountains, near the Czech border. By 2040, the German Raw Materials Agency (Dera) expects the global demand for lithium to be four to six times higher. A geothermal power plant in Germany also contains the raw material for electric car batteries.
The coveted material is obtained either from rock mines or from salt lakes (salars). Extraction from salt lakes has been criticized because pumping out the saline brine lowers the groundwater level and can make the drinking water unusable. According to the United States Geological Survey (USGS), Australia was by far the largest supplier of lithium in 2018, ahead of Chile, Argentina and China.
The largest currently known reserves are in Chile, where the mineral-rich groundwater is pumped into huge basins and evaporates there. Using a chemical process, lithium carbonate is produced from the remaining salt crust. In Chile, the water supply is also 100 percent privately owned – the state awards water concessions to private companies.
Tesla could become the first vehicle manufacturer with its own lithium refinery. Other automakers are seeking long-term deals with lithium companies. Tesla itself signed a five-year supply deal with Australian company Liontown Resources earlier this year, according to Reuters.
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