Podcast: The risks and rewards of lithium iron phosphate batteries

Lithium iron phosphate (LFP) batteries are cheaper, safer, and longer lasting than batteries made with nickel- and cobalt-based cathodes. In China, the streets are full of electric vehicles using this technology. But LFP never caught on as a chemistry for electric vehicle batteries in North America. In this episode, C&EN reporters Craig Bettenhausen and Matt Blois talk about the promise and risks of bringing lithium iron phosphate to a North American market.

C&EN Uncovered, a new project from C&EN’s podcast, Stereo Chemistry, offers another look at subjects from recent cover stories. Read Blois’s Jan. 30, 2023, cover story about lithium iron phosphate at bit.ly/3lsMybL.

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The following is a transcript of the episode. Interviews have been edited for length and clarity.

Craig Bettenhausen: Welcome to C&EN Uncovered. I’m Craig Bettenhausen. C&EN Uncovered is a production of Stereo Chemistry. In each episode, we’ll take a deeper look at a recent cover story in Chemical & Engineering News. C&EN’s savvy chemistry reporters will share striking moments from their reporting, their biggest takeaways, and what got left on the cutting-room floor. In this episode, we’re diving into a cover story from January about lithium iron phosphate, a once and future battery material that is getting a lot of attention and investment right now. I’m here with Matt Blois, who wrote that article. Hi, Matt.

Matt Blois: Hey, Craig.

Craig: We’ll link to that article in the episode’s show notes, or you can find it in the Jan. 30th print edition of C&EN. That’s January 30th, 2023. Definitely check it out if you haven’t already. So, Matt, for those people that haven’t had a chance to read the story yet, can you give a brief recap of, What is lithium iron phosphate? And why do we care?

Matt: Yeah, so lithium iron phosphate is, it’s a powder, basically, that you can use to make the cathode of batteries. And the cathode is just the positive end of the battery. And it’s the most valuable part of the battery. And in North America, most of the electric cars you see on the road will use a battery that’s made with nickel. But nickel can be really expensive. And especially . . . they’re usually nickel and cobalt, which can be especially expensive. So a lot of companies have been looking around for ways to decrease the cost of batteries. And lithium iron phosphate, which is also called LFP, is a really good way to do that because it avoids nickel, it avoids cobalt, and you’re instead using something like iron, which is just a lot cheaper as a metal.

So the story is about a couple of different companies that are trying to set up production of the LFP powders in North America. And LFP, it’s actually pretty common already in China; I think something like 40% of the cars in China have LFP batteries in them. But it basically isn’t used in North America. And the reason is because people in the United States, in Canada, we like to drive pretty long distances. And so the car companies have really favored these nickel batteries, which have higher energy density, which means if you’re in a car, you can drive farther.

So LFP is this option that, your car might not go quite as far, but it’s going to be quite a bit cheaper. And so a lot of car companies are sort of reevaluating that, you know, cost-versus-performance trade-off there. And a lot of them don’t want to rely on China to get those batteries.

Craig: One of the other things you talked about in your story is that this is getting a lot of investment. Nano One is one company, but there are several others. It seems, though, that this chemistry is proven; there’s thousands of vehicles on the streets in China doing it. So I guess my question is, Why are these battery makers and firms getting hundreds of millions of dollars of government subsidy and support? Because I usually think of that sort of thing as being targeted at more risky technology.

Matt: Yeah, so the basic science of it is totally there. There are two things that I see as a little bit risky with LFP in North America. So the first thing is that pretty much all the expertise except for this team at Nano One—which has done it at relatively small scales, but they’ve done it—almost all the expertise for doing large-scale LFP manufacturing is in China or in Taiwan. And really, it’s only one company that I’m thinking of in Taiwan. And so there’s this question about, like, How do you do you . . . you know, the tech all went over to Asia, and I think there’s a little bit of risk of how do you get that tech back to the United States. Because inventing something is not the same thing as scaling it up, even though there are, you know, there are plenty of companies that have scaled it up, that doesn’t necessarily mean that anybody can scale it up. I think it’s just, you know, there’s who . . . where are you going to get your engineers to run your factory? And that kind of thing? I think that’s a big question.

The second thing that I think is a little bit risky with on LFP is, Who’s going to buy it? Because there’s all these car companies that say, you know, what, LFP is the next big thing in North America, we’re all going to use it, you know, Ford, Tesla, VW, they all say that this is something they’re going to pursue. But for the most part, I think there are some Teslas on the road in the United States right now that have LFP batteries. But for the most part, this is not, you know, people are not buying LFP batteries in the United States or anywhere in North America, yet, they just, it doesn’t exist. There’s all this research about range anxiety that’s really interesting, you know, like, they’ll look at how far does a typical American drive, and on any given day, any old battery’s going to get you that far. LFP is, you know, for 95 to 99% of the time, an LFP battery’s going to absolutely accomplish everything you need. But I think there’s going to be a lot of people in the United States specifically, they’re going to say, “Well, what am I going to do about that 5 to 1%?” Because we live in a country that has no pedestrian or bike infrastructure or public transportation, so if your car can’t get there, you probably don’t have another way to get there.

Craig: So a lot of the activity in LFP up to now has been in China. And one of the things I noticed in your story was that there was this deal where the existing patent holders for the LFP production chemistry and other parts of the technology agreed to let the Chinese firms use that technology without paying licensing fees as long as the Chinese firms only made LFP in China, Why on earth would the LFP patent holders agree to that kind of a deal?

Matt: You know, I don’t really have a good answer to that question. It was something that puzzled me, and I think it has puzzled a lot of people. This little piece of the story actually took a lot of . . . I talked to a lot of people about this. And a lot of people I talked to were sort of unsure of the exact details of exactly how the arrangement was working and exactly why it happened in the first place. So there’s not really specific answers about that.

Craig: And so this company that has basically all the people that have ever actually made LFP on this continent, what’s the name of the company, the new company again?

Matt: The company we’re talking about is Nano One.

Craig: Nano One, OK.

Matt: So they’re a Canadian start-up. And then the original company was Phostech.

Craig: OK.

Matt: That was the company that was in, you know, started in early 2000s and scaled this up. And then Nano One bought that facility.

Craig: OK, so you actually went up there to Montreal? Tell us a little bit about that trip.

Matt: Yeah, so Montreal is a beautiful city. I, you know, stayed in sort of the downtown area of Montreal when I flew in there. And then you, basically, you cross over the Saint Lawrence River, to the south. And this facility is just right across the river. So it’s not really in downtown Montreal, but it’s, you know, if you walk side, you can sort of see the Montreal skyline across the river.

I was pretty excited to visit this facility because of the history there. Because I think it’s so interesting. LFP was invented—first invented—at the University of Texas. And then it really, that idea went up to Quebec, and you have Hydro-Québec and the University of Montreal working on this technology to improve it. It was eventually Phostech that got a hold of the license to go for it and try and scale it up. But it was really interesting to, just from a historical perspective, to see how far they got. Because it’s not a small factory. I mean, compared to the Chinese factories, it’s minuscule in scale. But in terms of, you know, when you’re walking around it, it’s multiple levels, it’s like large warehouse size, you know. I think, four, maybe five different levels. Big machinery, just, like, pipes going everywhere. It was pretty quiet when I went there, because they . . . Nano One had just bought the facility, they were really moving in and sort of getting set up, there wasn’t a lot of activity going on.

But it also sort of emphasized to me that the fact that this plant that felt pretty big walking around in it was, you know, way smaller than the size of plants that still need to be built to sort of serve growing battery industries. And that’s what they’re trying to do. I mean, I think Nano One sees this as sort of their test facility where they’re going to try things out and scale it up. And they’re already planning on building a bigger one, right next door. And then I think the ultimate goal is to partner with large companies to do even bigger-scale manufacturing.

Craig: Your anchoring character, Denis Geoffroy, is back at the former Phostech plant that he helped start back in the day. But it’s been 7 years and a couple different owners. How much of the people and you know, institutional knowledge is still at that plant in Montreal?

Matt: You know, there’s a significant number of people who have been at that plant for, you know, more than a decade, I think, at this point.

So I think that institutional knowledge is hugely important because nobody else in North America has really done it at any large scale. And pretty much everywhere else is in Asia. You know, the really large ones are in China. And then also you have some expertise in Taiwan too.

So Denis was really the leader of that plant, has been there for a long time. But much of his team is still intact. And a lot of people I talked to said, you know, that’s really, you know, when this start-up bought the old Phostech plant, that’s what they’re really buying is this institutional knowledge. Because the process that . . . they’re really, completely retrofitting the facility. They’re using, reusing a decent chunk of the equipment. But really, the entire process is going to be totally new. But the way Denis described it to me was, you know, because they set up a separate solid-state facility in Canada, that was smaller, first. And then they went on to this bigger facility and built up an entirely different process. And now they’re kind of doing it this third time. And even though it’s a new process, you know, I think Denis is saying, you know, we’re good at building LFP factories, kind of no matter what the process is.

Craig: Now, the story mentioned that, you know, trolling motors are one place you can get an LFP battery today, like for a boat for going fishing. Where else might these things fit? I’m imagining e-bikes and small motorcycles. Where else was this technology a good fit?

Matt: Well, I mean, yeah, I mean, it depends on who you ask. But it certainly can work in electric vehicles. I mean, like I said earlier, you know, this is common in China. You know, personal cars that don’t need to go superlong distances, LFP can be a really good chemistry for that. Also, buses—there’s a lot of buses that end up with LFP batteries.

Another place that people look at it is for the energy, sort of stationary energy storage. You’re a lot less concerned about energy density when you don’t have to move the battery at 60 mi an hour down the highway. If it’s just sitting in your house, you know, it can be a little bit bigger. It certainly doesn’t matter how heavy it is. So things like that, you know, stationary energy storage is definitely, could be a good use there.

So usually when, when I see sort of comparisons of different performances of battery chemistries, they’ll show it on this graph, where it’s like a pentagon, and each point at the pentagon has sort of a different facet of batteries that you might be considering. So energy density is a really important one for cars. But you also have things like cycle life, like how many times can you charge and recharge the battery. So LFP is actually better than nickel-based batteries in terms of how many life cycles it can go through. It’s also safer: it’s less likely to catch on fire than nickel-based batteries. So it has some advantages in safety and cycle life, even though you’re giving up a little bit on the, you know, energy density side.

Craig: So you mentioned that LFP can be cheaper than the nickel-based batteries, but nickel and cobalt are also, you know, more toxic metals. What kind of difference does it make as far as the environmental footprint?

Matt: Yeah, that’s actually, that’s a pretty big part of, of why, you know, in addition to the cost, that sort of environmental concerns, and sort of social concerns that go along with that are a pretty big part of why car companies and battery makers are interested in LFP as well. So nickel—a lot of nickel ends up coming in from Indonesia, and there can be a lot of environmental problems. You end up having waste go out into the ocean. And you end up having some, I think deforestation, it can also be an issue. Nickel has definitely been sort of targeted as a mineral that’s maybe not so great for the environment, and people aren’t so happy about how it’s being mined. The issue with cobalt is actually more on the social side. I mean, it’s, you know, mining certainly has an environmental impact. But there’s . . . a lot of cobalt comes from the Democratic Republic of the Congo. And there’s issues where you end up with children who end up working in the mines. And when, you know, this is the very start of a supply chain. I mean, these are people who are, I think with cobalt, it’s, a lot of people were actually sort of picking up rocks and digging with shovels by hand off the surface. And it can be pretty disorganized and hard to tell exactly, you know, trace that supply chain all the way back, especially if you’re like a battery maker that’s on a different continent. But there’s . . . basically there’s big social concerns about having children working in cobalt mines. So car companies, you know, don’t want to be involved in that. So they’re trying to either make sure that their cobalt is mined safely and by adults, or another, easier way to ensure that you’re avoiding all of that is just to not use cobalt. And the fact that cobalt is pretty expensive is another reason to make that decision. So there’s definitely some environmental and social concerns with, especially the nickel and cobalt.

Craig: So what else were some interesting nuances and tangents that just didn’t fit into the print story but that you found really interesting when you were, you know, getting ready to write it?

Matt: One thing that I didn’t get to write about very much that came up a little bit with different companies I was talking about is this idea of like, what comes next after LFP? Because there’s, you know, if you look at sort of the development of battery chemistries, there’s this trend where you’re going from nickel cobalt oxide to nickel manganese cobalt to LFP. And so you’re moving from these things that are like super high energy density, but expensive, to things that might have a little bit less energy density, but they’re less expensive. And you start, you see other companies already talking about, like, can we use sodium-ion batteries? Because lithium is expensive. LFP still has lithium in it. So can you use a sodium-ion battery or potassium-ion battery or something like that? And how do you sort of move in that direction of cheaper materials, you know, less environmental impact, more reliable supply chains, without losing too much performance?

Craig: Now you mentioned a couple of times how active this area is in research but especially from investment and some more things have happened in LFP, even since this story came out on the 29th.

Matt: Yeah, so the big one, and this is one I mentioned, sort of, the rumors of this in my story when it came out in January. But this was just recently. Ford is now going to have this partnership with CATL, which is the biggest battery maker in the world, based in China. They are going to set up an LFP cell factory in Michigan. And it’s a big plant. It’s like $3.5 billion. But I think one of the really interesting things is we talked a little bit about, you know, where does all the LFP expertise come from? And I think it’s really interesting to think about how Chinese companies are going to play a role in that, and what role do they want to play, what does the Chinese government think about that? What does the US government think about that? Because I know, when Ford and CATL announced this deal, both policy makers in the United States had a lot of questions about it, and policy makers in China had questions about it, how it was going to work. But, you know, I think if you’re a car maker and you really want to go with a company that knows what they’re doing on LFP, you know, CATL, they, they do a lot of this. They really know what they’re doing. Obviously, like, it comes with some, like, geopolitical risks.

And another thing that I think is an unanswered question is, you, we just had last year the Inflation Reduction Act pass. It’s supposed to subsidize a lot of these factories that are being built to make batteries. To me, it’s not totally clear how, like, Ford and CATL’s plant fits into that. I think we’re supposed to get a little bit more guidance on that from the Treasury Department in March. But it’s, I don’t think we quite know. Ford has done sort of some trick plays to try and, I think, see if they can qualify for the tax credits. But I definitely have seen some policy makers sort of at the congressional level that are saying, “We don’t like what’s going on here. We don’t want CATL to be getting these tax credits that are supposed to go towards, like, United States–based manufacturing.”

Craig: Well, Matt, this is all very interesting stuff. Thank you for taking the time to tell us all about it.

Matt: Yeah, yeah. It’s super fun to talk about. It’s one of my favorite stories that I’ve been able to report for C&EN and always, always happy to talk about batteries.

Craig: Once again, you can find Matt’s cover story about lithium iron phosphate on C&EN’s website, or in the January 30th, 2023, print issue of C&EN. We put a link in the show notes along with the episode credits. You can find me on social media at @CraigOfWaffles.

Matt: You can find me on social media at @Matt_Blois.

Craig: This has been C&EN Uncovered, a new series from C&EN’s Stereo Chemistry. Stereo Chemistry is the official podcast of Chemical & Engineering News. C&EN is an independent news outlet published by the American Chemical Society. Thank you for listening..