INTERVIEW: Statevolt jumpstarting 'hyperlocal' strategy for California battery sector, says CEO

Battery producer Statevolt is working to attract key players from across the lithium and battery supply chains to set up operations near California's Imperial Valley, where it is proposing to build a 54 GWh gigafactory, to achieve a "hyperlocal" battery industry in southwestern US, according to CEO Lars Carlstrom.

"This hyperlocal concept is important because batteries should be produced locally," Carlstrom said in an interview with S&P Global Commodity Insights. "They are very heavy, and so are the minerals and the products used in the battery, so the ideal situation is to have a concept where all of the products are being more or less produced on site."

Statevolt announced in May its plans to establish a gigafactory near California's Salton Sea along with a preliminary deal to source its lithium supply from Controlled Thermal Resources, a company that is developing lithium extraction operations in the region.

However, lithium chemicals must be processed into refined battery materials, which are then further manufactured into cathodes before being assembled into batteries. Statevolt is now in talks with other companies to bring these intermediate links of the supply chain to the Imperial Valley.

"We are taking this opportunity to explore this area either with partners or looking to collocate with the operators in this space," Carlstrom said. "We are in talks with at least two partners currently for this process, so we don't need to send lithium to China or elsewhere."

CTR currently utilizes brine from the Salton Sea's geothermal field to yield renewable power. The company is now developing operations to also extract lithium from the geothermal brine with a target to produce 20,000 mt/year in 2024 and about 80,000 mt/year by 2026.

Statevolt's supply deal with CTR includes the sourcing of geothermal power for its operations, an arrangement that would further strengthen its hyperlocal approach.

A timeline has not yet been confirmed for when Statevolt will begin construction and start producing batteries.

Critical mineral sourcing

Besides its lithium deal with CTR, Carlstrom said Statevolt is keeping an eye on the abundance of potential lithium production assets being developed in North America.

"The area [southwestern US] is probably one of the richest in the world when it comes to lithium, and there are many opportunities also in Mexico, so I think the supply of lithium is less concerning for us," he said.

However, Carlstrom said that battery producers must monitor tight supplies of other critical battery materials like cobalt and nickel.

"We should not be shy and say it's not a problem because the supply chain is the big issue for gigafactories, and China has a monopoly on rare earth minerals, maybe controlling up to 95% of all the rare earth minerals in the world," he added.

Carlstrom said governments must be active in promoting domestic critical mineral supply chains in collaboration with private enterprises to bolster the growth of battery industries in their countries.

"The only one who can change the supply chain of rare earth minerals is governments," he said. "We need to have government support to change this development and to bring back this control [from China] because I don't see any private companies today that can compete with China and reestablish business locally without government support."

Strong US backing

Carlstrom previously founded gigafactory projects in the UK (BritishVolt) and Italy (Italvolt), and he said he chose the US for a third factory because of the support shown by the Biden administration for electrification and battery supply chains.

"I'm very hopeful that within the next five to 10 years, we'll have a totally different opportunity and map on where to source the relevant minerals [for battery production in the US]," he said.

The leadership of American automakers and private entrepreneurship in reshoring the battery supply chain in the US has also bolstered optimism for the domestic industry, he added.

"America has been behind, but they are for sure picking up big time and they are really showing great actions, and I think Europe will actually be behind after this program has been rolled out fully in America," Carlstrom said.

Biden in June invoked the Defense Production Act that authorized the Department of Energy to support domestic production of key energy technologies. For national defense interests, the legislation also pushes for the development of domestic mining, processing and recycling infrastructure to secure battery material supply chains.

In addition, the US bipartisan infrastructure law calls for the national build out of electric vehicle charging networks, and Biden signed an executive order in 2021 that established a goal of having half of all new vehicles sold in the US be electric by 2030.

Social Impact

Carlstrom said he has sought out to build gigafactories at geographic locations that are "in decline where we can make a real change and social impact," and he described California's Imperial Valley as a region that would benefit from an influx of new industry.

In Imperial Valley, Statevolt could bring over 2,500 direct jobs to the area, and additional employment opportunities could reach near 8,000 when accounting for collocated companies, supporting infrastructure, supply chain partners and services.