Renewable startups are urging state and federal governments to take greater risks by investing in small-to-medium sized renewable Battery companies and prevent Australia missing out on the lithium boom.

A recent report by consulting firm the McKinsey Global Institute estimated that surging demand for lithium-ion batteries would see the sector grow from $126 billion to almost $600 billion by the end of the decade.

The federal government in February began consultation on its National Battery Framework Issues paper to help develop a roadmap for investing in Australia’s fledgling battery manufacturing industry. 

In its submission, Sicona Battery Technologies (SBT) identified obstacles to creating a domestic manufacturing industry.

It said that while Australia possessed the relevant resources and technical expertise, its “institutions” were taking a “risk-averse approach”.

“Governments (federal and state) should be more willing to take a risk and accept that some of their grant recipients will fail,” the next-generation battery materials company said.

“Invest in everything. We should be proud to invest in competitors and competing technologies.”

SBT said grant application rules needed overhauling to consider the needs of startup, small and medium-sized companies, particularly the requirement that applicants secure capital before applying for government funding. 

The company also suggested hiring startup experts to help Australian universities successfully commercialise their technology.

We just ‘ship it overseas’

SBT co-founder Dr Andrew Minett said Australia was currently focused on exporting raw materials and was not capitalising on the opportunity to produce refined chemicals and advanced battery materials.

Australia has 96 per cent of the raw materials used in lithium batteries, but Dr Minnett said just 4 per cent of that value was kept onshore.

“Because we just dig it up and ship it overseas,” he said.

He said the global electrification push had created a massive demand for batteries, and Australia risked missing out on the opportunity.

“China dominates this industry and has done and will continue to do so, and everybody is playing catch-up,” Dr Minnett said.

“Australia has this opportunity, and it needs to happen now to actually make a battery industry happen here in Australia.”

Defence demand driving manufacturing

In New South Wales’ Hunter region, battery manufacturer Energy Renaissance has recently moved into Australia’s first battery gigafactory, Renaissance One.

Company founder Brian Craighead said there was a structural problem in the Australian battery market, with private investors reluctant to invest in small-scale manufacturing.

“This is a time when the government’s intervention makes sense,” he said.

“Without spending a dollar, suddenly they have turned tens of millions of dollars of battery demand to look inward because it makes sense.”

Energy Renaissance recently signed a $161-million deal with the Australian Defence Force to exclusively supply batteries for defence mobility applications.

Mr Craighead said the military’s growing demand for batteries had created a “national security imperative” to build a sovereign battery capability.

“The technology they use needs more and more batteries. They can’t get enough of them,” he said.

“They need to be safe, they need to be cyber secure, and they need software that is run locally.

“This has created a massive accelerant in the demand for local provision of batteries.”

Australia’s first lithium cell plant

While a number of Australian battery manufacturers have emerged in recent years, they all import their cells from overseas.

Energy Renaissance and SBT have aspirations to build Australia’s first commercial lithium-ion cell facility.

SBT has unveiled plans to build its plant on a parcel of land at Shellharbour airport in NSW’s Illawarra region.

The company hopes the $60-million facility will be up and running within two years, pending a $20-million grant from the NSW government.

The facility is expected to create 150 jobs in the construction phase and employ 60 permanent highly skilled staff once it is operational.

The plant will target niche industries such as satellites, drones and even motorsports, but its primary purpose is to test next-generation materials to improve battery performance.

SBT is in talks to supply Chinese battery manufacturer CATL with its battery materials.

CATL recently announced a battery that could propel an electric vehicle 1,000 kilometres.

Dr Minett said using SBT’s materials would make their battery even more efficient.

“It would give you 700 to 750 watt-hours per kilogram in terms of energy density, which would allow you to drive even further than 1,000 kilometres on a single charge,” he said.

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