CO2 → Critical Materials

Summary

CO2 removal at the gigaton scale is needed to avoid the 2°C anomaly and the worst effects of the climate crisis. Simultaneously, the market for clean energy storage technologies is facing substantial supply constraints as it experiences massive growth brought on by the electrification and decarbonization of the economy. Graphite (crystalline carbon) is one such critical material, facing among the more severe pinch points. In this whitepaper, we outline the Homeostasis vision of transforming CO2 emissions into graphite, and provide a high level overview of the technology we’ve built to support this vision. By mining the skies with a fully electric process, Homeostasis can access a massive supply of carbon from virtually anywhere on Earth, alleviating supply bottlenecks resulting from incumbent processes, and deliver meaningful cost reductions.

Introduction

The International Panel on Climate Change (IPCC) has stipulated the need for 10 billion tons (Gt) of annual CO2 removal, in addition to a reduction of global annual emissions by 40 Gt, by 2050 to avoid the 2°C anomaly and the worst effects of the climate crisis. With the combined annual crude oil and natural gas extraction amounting to 7 Gt/yr, this CO2 removal (CDR) industry will be massive. However, most CDR proposals today rely on some form of carbon credits for revenue, with the industry targeting $100 per ton by the mid 2030s, placing pressure to rapidly reduce costs [1]. Given that the industry is simultaneously developing its markets, technologies, and attempting massive scale-up (50 Kt/yr in 2023 [2] to 10,000,000 Kt/yr by 2050), the push for significant cost reductions puts the CDR industry in a precarious position. Thin margins and capital-intensive scaling do not mix well.

Meanwhile, the battery industry is experiencing substantial critical materials supply problems, especially in Western markets. Graphite (crystalline carbon), which is a critical active anode material for lithium ion batteries (making up roughly 25% of the battery’s mass, on average), is particularly compromised on supply, cost, and emissions.

Incumbent graphite producers either mine graphite from natural reserves (natural graphite, “NG”) or pyrolyze fossil fuel to form coke, which is then graphitized (synthetic graphite, “SG”). Raw NG ore usually contains 2-30% graphitic carbon, by mass, and thus requires processing and purification to become battery grade (99.95%). This processing involves several cycles of milling and flotation – where graphite particles are dislodged from impurities and separated using varying hydrophilic/hydrophobic properties – followed by hydrofluoric acid and/or alkali leaching or thermal treatment [3]. SG is produced in three general steps, often performed in different facilities by different entities: (1) production of ‘green coke’ via oil refining or the pyrolysis of fossil fuels, (2) the calcination of green coke to increase purity to 97-99%, and (3) the graphitization of calcined coke through exposure to 2500°C – 3000°C, with the full graphitization cycle taking roughly 15 days [3, 4]. The final NG and SG products will usually undergo spheroidization, particle size selection, and coating with a conductive carbon product (e.g., carbon black or pitch tar), forming the final anode material product. Both NG and SG are energy intensive processes, requiring 18.4 MWh/t and 25 MWh/t, respectively [3], and are thus associated with substantial CO2 emissions (16.6 - 20.6 tons of CO2 per ton of graphite) [3, 5].

Figure 1: Graphite, a critical material for batteries, is facing among the worst supply constraints, from the standpoint of availability relative to anticipated demand (Source: IMF [6]).

The current supply regime maps to a substantial gap between anticipated demand and availability of battery graphite, with the IMF reporting a shortage as severe as 85% [6, 7]. Further, over 75% of global battery graphite supply comes from China, who has recently placed export restrictions, targeting western markets [8, 9]. As North American battery manufacturing capacity is expected to increase from 55 GWh (2021) to 1000 GWh (2030) [10], cell manufacturers are facing an increasingly challenging supply reliability story. Prices for NG and SG generally fall around $8-10/kg, and $10-12/kg, respectively. Beyond cost of production, this variation in price is justified by material quality and performance. While SG will usually make for a better, smaller battery, battery cell manufacturers in the electric vehicle (EV) supply chain tend to use NG, or a mixture of NG and SG – signaling the importance of cost in this market .

Figure 2: China’s dominance of the graphite market (Source: CTVC [11]).