Strategic Path to Challenges
Faced with the triple challenges of resource dependence, environmental pressure and international competition, China's lithium battery industry urgently needs to build a systematic response strategy. These strategies need to not only solve the current urgent problems, but also lay the foundation for the long-term sustainable development of the industry. Through the multi-dimensional combination of technological innovation, policy guidance and business model transformation, China is expected to achieve high-quality development of the lithium battery industry while maintaining global competitiveness.
Resource diversification strategy
The resource diversification strategy is a core measure to ensure the security of the supply chain. China is reducing its dependence on overseas lithium resources through a multi-pronged approach of "increasing revenue and reducing expenditure". In terms of increasing revenue, China is accelerating the development of various lithium resources, and plans to form a diversified supply pattern of lithium ore resources (estimated to be 300,000 tons), salt lake lithium extraction (250,000 tons), waste lithium battery recycling (50,000 tons) and lithium clay mineral resources (100,000 tons) by 2025. The capacity of lithium extraction from salt lake brine in Tibet and Qinghai is expected to increase from 53,000 tons in 2022 to 250,000 tons in 2025. In terms of cost saving, the improvement of the battery recycling system will greatly increase the recycling rate of resources. It is expected that the amount of lithium recycled from waste lithium batteries will increase from 5,000 tons/year in 2022 to 50,000 tons/year in 2025. Ganfeng Lithium and other companies have also deployed lithium clay resources in Mexico, with a total reserve of more than 10 million tons of lithium carbonate equivalent, adding a new source of resource supply.
Advanced extraction process
Technological innovation plays a key role in the efficient utilization of resources. The development of advanced extraction processes can improve the utilization rate of low-grade resources. During the period of high lithium prices in 2022, Jiangxi companies have reduced the utilization grade of lithium mica from the traditional 3.5% to 0.5%, almost "eating up" the resources. Similarly, breakthroughs in salt lake lithium extraction technology have made it possible to develop high-altitude, high-magnesium-lithium ratio salt lakes such as Tibet. In the battery design link, the optimization of material systems such as high nickel and low cobalt and lithium iron phosphate reduces the lithium consumption per unit battery; and in the manufacturing link, process improvements reduce production losses. Yang Hongxin, Chairman and CEO of Honeycomb Energy Technology Co., Ltd., predicted: "In 2025, the unit price of PACK system will drop to less than 0.5 yuan, which will become a common phenomenon." This cost reduction is partly due to the improvement of material utilization efficiency.
Environmental governance system
The improvement of the environmental governance system is the institutional guarantee for solving the pollution problem of the lithium battery industry. Jiang Guibin, an academician of the Chinese Academy of Sciences, suggested carrying out three key tasks: first, "finding out the basic situation of lithium pollution in key areas across the country"; second, "strengthening relevant basic research and assessing the ecological and environmental risks of lithium pollution"; third, "strictly controlling the source and strengthening the control of lithium emissions from key pollution sources." Specific measures include formulating pollution emission standards for the lithium industry, establishing a waste battery recycling system, and strengthening environmental supervision in the mining and smelting links. Yichun City has provided a regional example for the rectification of lithium mining and pollution. Its "Notice on Severely Cracking Down on Illegal and Criminal Acts Involving the Lithium Battery New Energy Industry" systematically cracks down on illegal mining, ecological destruction, illegal land occupation and other behaviors. In the future, this kind of environmental supervision will tend to be normalized and refined, and promote enterprises to shift from passive compliance to active pollution control.
Key breakthroughs
The research and development and application of green production technology will become a key breakthrough in reducing environmental impact. In the mining stage, green mine construction and ecological restoration technology can minimize damage to the natural environment; in the smelting stage, clean production processes and wastewater treatment technologies can reduce pollution emissions; in the recycling stage, automated disassembly and efficient extraction technologies can improve resource recovery rates and reduce secondary pollution. It is worth noting that the current mainstream water treatment process has a removal rate of less than 20% for dissolved lithium ions, and there is an urgent need to develop more efficient lithium pollution control technologies. Some innovative companies are exploring the use of adsorption, membrane separation and other technologies to recover lithium from wastewater, which not only controls pollution but also achieves resource recovery. The policy level should also "introduce support policies for the development of lithium pollution prevention and control technologies, and do a good job in wastewater and waste residue treatment and disposal and tap water purification technology reserves."
Internationalization strategy adjustment
Internationalization strategy adjustment is crucial for Chinese lithium battery companies to cope with overseas competition. The simple product export model is no longer able to adapt to the new trade environment, and localized production has become an inevitable choice. Chinese battery companies are promoting globalization through various means: first, direct investment in factory construction, such as CATL's establishment of production bases in Germany and Hungary; second, cooperation with technical partners, such as the strategic cooperation between Guoxuan High-tech and Volkswagen Group; third, participation in global resource development, such as Ganfeng Lithium's investment in lithium mines in many countries around the world. As of 2023, 10 Chinese power battery giants have planned or have already deployed overseas, with 33 public projects and a total investment of more than 400 billion yuan. This internationalization is not only about capacity layout, but also includes the globalization of R&D, talents, and services to build a true transnational business capability.
Circular economy system
Building a circular economy system will be a long-term solution for the sustainable development of the lithium battery industry. The ideal lithium battery circular economy includes designing easy-to-recycle battery structures, establishing an efficient recycling network, and developing low-pollution recycling processes. At present, China's lithium battery recycling industry has formed a pattern of joint participation by power battery companies, OEMs, material companies, and third-party recycling companies, and the business model is based on "enterprises cooperate with each other to create a closed-loop resource model for power battery recycling." In the future, it is necessary to further improve recycling policies and regulations, clarify the extended producer responsibility system, and improve the economic efficiency of recycling through technological innovation. Battery recycling can not only ease resource pressure, but also reduce the environmental impact of the entire life cycle, and is an important way to achieve the "dual carbon" goal.
Industrial synergy and policy support
Industrial synergy and policy support are important guarantees for the implementation of the above strategies. The lithium battery industry chain is long and complex, involving multiple links such as minerals, materials, batteries, complete vehicles, and recycling, and requires coordinated development of upstream and downstream. Government departments can guide the healthy development of the industry by formulating industry plans, providing research and development funding, and improving the standard system. For example, the Ministry of Industry and Information Technology clearly stated that "it will focus on meeting the production needs of power batteries and moderately accelerate the development of domestic lithium, nickel and other resources." At the market level, low-level duplicate construction and vicious price competition should be avoided, and the industry should be promoted from scale expansion to quality and efficiency. As Wu Kai, chief scientist of CATL, said: "The development of new energy storage cannot be short-term benefits, but a long-term plan, just like a house is for living, not for speculation, and energy storage is for use, not for facades or decorations."
High-quality development
Looking ahead, China's lithium battery industry will enter a new stage of high-quality development. Despite multiple challenges such as resources, environment and international competition, China still has significant advantages in market size, industrial chain integrity and technological innovation capabilities. With the optimization of industrial structure, technological upgrading and deepening of international layout, China is expected to build a safer, greener and more sustainable lithium battery industry ecosystem. Against the backdrop of global energy transformation, the lithium battery industry is not only related to the competitiveness of China's manufacturing industry, but also a key support for achieving the "dual carbon" goal. By systematically responding to current challenges, China's lithium battery industry will continue to lead the global clean energy revolution and make important contributions to global sustainable development.
