U.S. LI-ION BATTERY PRODUCTION
A Strategic Need
We are presently equipping our advanced lithium-ion battery production facility in Fremont, California. Our immediate goal is commercial delivery of our 3D Silicon Lithium-ion Battery to customers. Another important goal is to demonstrate a cost-effective process that can ‘drop-in’ to a standard lithium-ion battery production line and increase Mega-Watt hour (MWh) capacity by 30%. This is the first in a series on U.S. Li-ion Battery Production that will address the need for the United States to revitalize lithium-ion production and how Enovix will help lead that effort.
The Need for U.S. Lithium-ion Battery Production Leadership
Increased global demand for consumer electronics, electric vehicles, and energy storage systems have made Li-ion batteries invaluable in today’s global society. China recognized a decade ago the importance of establishing a lithium-cell manufacturing base.1 According to the International Energy Agency (IEA), China increased its lithium-ion cell production capacity from 9 giga-watt hours (GWh) in 2010 to 145 GWh in 2017.2 By 2018, China controlled about two-thirds of the global lithium cell production capacity, and that is expected to grow to an estimated 73% by 2021, according to BloombergNEF. In comparison, the U.S. controlled only 13% of the global capacity in 2018, with no growth expected.3
In written testimony before the U.S. Senate Committee on Energy and Natural Resources on February 5, 2019, Simon Moores, managing director at Benchmark Mineral Intelligence, said, “We are in the midst of a global battery arms race in which the U.S. is presently a bystander.” Regarding lithium-ion battery production, he added, “…those who possess the manufacturing and processing know-how will hold the balance of industrial power in the 21st century auto and energy storage industries.”4
James Greenberger, executive director of NAATBatt International, makes the case that lithium-ion battery production is strategic to U.S. economic security because it is fundamental to other critical emerging technologies. He says that advanced battery development and production today is analogous to semiconductor development and production in the 1980s, when Japan was a primary competitive threat.5 Without a vibrant semiconductor industry, U.S. progress in emerging industries such as wireless communications, multimedia, and personal computers would have been hampered, damaging the broader economy.6 Today advanced battery development and production is strategic to other important, high-value technologies such as mobile communications and computing, electric vehicles, and energy storage systems.
Recent events, such as trade disputes and a global pandemic, demonstrate that strategic goods produced largely offshore are at risk of disruption.7 And the threat is not just economic. A November 2018 article in National Defense, “Offshore Battery Production Poses Problems for Military,” states that although the U.S. Defense Department “is a relatively small consumer of lithium battery technologies when compared to the commercial market, the importance of these technologies cannot be understated,” and “without a domestic production capability, there are no assurances that a foreign producer will even be willing to ship to the United States in times of conflict.”8 A December 2019 report from The Institute for Defense Analyses, “Lithium Ion Battery Industrial Base in the U.S. and Abroad,” states that it is “highly desirable for U.S. industry to have more of a leadership role in the production of Li-ion batteries, especially next-generation batteries.”9