Batteries Strategy

Lithium-ion batteries for electric vehicles

Propulsion Québec is collaborating on the development of an industrial sector for lithium-ion batteries for electric vehicles (EVs), since it represents one of the biggest opportunities for Quebec in the current transection to a green economy. Efforts range from developing the mining and manufacturing sector to attracting foreign investments and asserting Quebec’s competitive position in the world market.

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In Quebec and elsewhere in Canada, social and environmental responsibility initiatives are multiplying and the so-called critical and strategic minerals and metals (CSM) industry is at the heart of this global trend around which the energy and ecological transition is being built. The best known example of this is clearly the lithium-ion battery industry. However, the production of the minerals used in the composition of a battery of this type, as well as certain components, presents significant social and environmental risks. These are both social (e.g. child labor, unsafe working conditions, indigenous rights, etc.) and environmental (e.g. carbon footprint, water use, loss of biodiversity, air pollution, etc.) and have a significant impact on the overall sustainability of the final product.

However, there is a tool that can be used to address this issue, in parallel with the adoption of ESG standards and best practices in the industry: the implementation of traceability mechanisms extending along the entire value chain of a battery, from the mine to its integration into an electric vehicle, and demonstrating compliance with these standards and best practices at each stage of production.

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The lithium-ion battery sector in Quebec

With close to 80 players already active across every link of the value chain, the Quebec lithium-ion battery ecosystem, including battery recycling, is dynamic and vibrant. Strengthening the lithium-ion battery industry is a logical and strategic extension of the government’s commitment to the large-scale electrification of our transportation sector, and is also a driver of economic development for Quebec and its regions.

An ambitious, collective vision is needed in order to seize the profitable opportunities for Quebec in developing its lithium-ion battery industry.

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Quebec has what it takes!

Quebec boasts many assets, but the ones below are sure to be the most instrumental in the batteries strategy:

Stable, renewable energy with a minimal carbon footprint (link available only in French)
Some of the world’s most affordable energy rates
Large deposits of critical and strategic minerals (CSM) and strategic projects in development
Responsible production processes
State-of-the-art R&D ecosystem
Top-tier scientific expertise in batteries (including fundamental patents)
Skilled, educated, bilingual workforce
Low cost of living for North America
Stable and secure geopolitical environment

Critical and strategic mineral development

Smart devices and equipment, aerospace, telecommunications, renewable energy, energy storage, medicine, and, of course, the electrification of transportation are all growing sectors where a critical and strategic mineral (CSM) supply is essential.

CSMs have become part of our daily lives and are found in many everyday items, from the graphite, lithium, cobalt, and nickel needed to make EV batteries to rare earth elements used for magnets in electric motors.

Demand for CSMs is growing and procuring them is becoming a strategic issue for many companies and countries. A number of CSM development projects are currently underway in Quebec.

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Pilot project to establish a traceability system for the minerals needed to manufacture batteries

Traceability hinges on artificial intelligence and big data management. It makes it possible to follow a product through the various stages of processing to know exactly where it came from and what it does.

For instance, a traceability system would make it possible to track a given product to:

Make sure it complies with applicable standards and principles of ethics, governance, and social responsibility
Control product quality and optimize production
Manage its carbon footprint or promote other distinctive characteristics for commercialization

A traceability system could eventually:

Attract more investment by demonstrating compliance with applicable standards and principles of ethics, governance, and social and environmental responsibility throughout the supply chain of a made-in-Quebec product
Give Quebec businesses a competitive advantage through products that meet increasingly high end-user “eco-responsible” standards
Support complete, sustainable, and responsible CSM value chains, from mineral extraction to recycling

On November 17, 2021, the Government of Quebec announced $151,600 in financial assistance for a pilot project on the traceability of minerals used for batteries.

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Development of significant production capacity for value-added components that can be integrated into North American and European EV production chains

Quebec is leveraging its unique strengths and assets to build a strong ecosystem from innovation to commercialization that will be highly attractive to international investors and manufacturers who want to develop a battery industry in North America to supply the promising transportation electrification market.

In partnership with Ministère de l’Économie et de l’Innovation, Investissement Québec, Ministère de l’Énergie et des Ressources naturelles, Hydro-Québec, and Natural Resources Canada, Propulsion Québec is working to facilitate essential linkages between manufacturers active throughout the value chain and these key government players, from extracting minerals to installing batteries into EVs, while factoring in responsible management of end-of-life batteries and the circular economy.

Quebec intends to strategically position itself globally as a destination of choice for the development of an EST manufacturing industry that will raise Quebec’s profile around the world.

To that end, Propulsion Québec is focusing its efforts on the integrated development of mine production to promote the processing of CSMs into precursor materials for batteries, by supporting the technological development of processes with a reduced environmental footprint.

Propulsion Québec’s actions also hinge on the development of production capacity for value-added components (cathodes, anodes, cells, modules, packs) that can be integrated into the North American and European electric and smart vehicle production chains.

Development of a circular economy model

At Propulsion Québec, adopting a circular economy model for this industry is an essential aim that must be based not only on responsibly managing end-of-life batteries, but also on maximizing their use to reduce industrial waste at every step in the value chain.

Achieving this level of circularity will first require an in-depth understanding of product life cycles and how materials flow throughout the value chain. And then regulatory mechanisms must be adopted to govern end-of-life battery management and make them veritable “urban deposits” of CSMs.

Coordination and consultation across North America: A key success factor

Propulsion Québec believes that one—and perhaps the biggest—key factor in the successful implementation of such a circular model is coordination and consultation across North America to harmonize end-of-life battery management, from local/regional collection and sorting to the sharing of recycling steps based on clean industrial processes. Past experience in Quebec and elsewhere shows that companies in this industry are all too often forced to contend with a multitude of regulatory requirements and administrative processes.

Harmonizing current and future rules and regulatory mechanism between jurisdictions would make it easier for industry stakeholders to play by the rules and lighten their administrative load. Furthermore, standardizing regulations between jurisdictions would give our Quebec recyclers access to a larger pool of end-of-life batteries than they would get from Quebec sources alone.

Having a shared set of rules and practices across North America would allow us to work with other regions (e.g., the U.S. Northeast and Ontario) and create a viable and sustainable circular model for batteries.

Learn more about implementing an Extended Producer Responsibility (EPR) mechanism in our full study and position paper.

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