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Canada will power the electric vehicles revolution - report

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(Kitco News) - Canada will play an essential role in the global green energy and electric vehicles (EV) revolution, said Philippe Ferland, a business analyst at Invest in Canada.

Monday, in his presentation during the Prospectors & Developers Association of Canada (PDAC) 2021 virtual conference, Ferland said that Canada has what it takes to be a secure, sustainable and stable supplier for every stage of the supply chain from critical minerals needed to produce batteries to EV that they will ultimately power.

The components of this supply chain potential include Canada's rich critical mineral deposits, robust environmental and regulatory framework, the widespread use of renewable energies, world-class battery R&D capabilities, major auto manufacturing ecosystem and expertise in battery recycling.

According to Ferland, Canada is the only country in the Western Hemisphere able to manufacture electric vehicles from start to finish. He added that BloombergNEF projects that Canada's downstream demand for EVs will rise from 11th to 6th in the world by 2025.

On the supply side, cobalt, graphite, lithium, nickel and rare earth elements are critical minerals for battery production and Canada has them in abundance.

Canada currently ranks 4th in the world and 1st in North America for raw material capacities in the battery supply chain. It is expected to rise to 3rd by 2025.

As a supplier, Canada ranks 4th in the world for cobalt, 3rd for nickel and 3rd for graphite.

Globally, Canada ranks among the top countries for refined nickel production and is increasing its capacity for cobalt, graphite, lithium and rare earth element processing with plants being developed across the country.

These facilities will be able to directly supply cathode and anode manufacturers as the next value-added stage of the battery supply chain, said Ferland.

As more companies make pledges to ethically source minerals and other supply chain inputs, Canada emerges as the destination of choice for investors with the environmental, social and governance (ESG) framework in mind.

Canada's normative and legal framework for mining activities include regulations on greenhouse gas (GHG) emissions, water use, waste management, human rights, fair labor practices, progressive board composition, business ethics, community relations, and free, prior and informed consent (FPIC) with First Nations.

The country's clean energy infrastructure ensures all segments of the supply chain can be supplied with clean and sustainable energy.

In addition, Canada is making significant strides towards the electrification of transportation and becoming a cleantech manufacturing hub. Two provinces, Quebec and B.C., have already pledged to ban the sale of new gas vehicles by 2035 and 2040, respectively.

Canada's longstanding advantages in automotive manufacturing are perfectly transferable to EV manufacturing, offering Canada a unique advantage in forming a "mines to mobility" supply chain.

Canada is also attracting significant investments from major automotive manufacturers. GM, Ford Motors and Fiat Chrysler have all committed to building EVs in Canada, with the sum of their announced investments totaling C$5.75 billion.

In addition, Canadian companies are global leaders in battery recycling capabilities and technology. The E.U.'s Green Deal will require EVs and industrial batteries sold in Europe to disclose their carbon footprint, comply with a CO2 emissions limit, disclose their content of recycled raw materials, and later use a minimum share of recycled cobalt, lithium, nickel and lead.

Canada's abundance of renewable energy and its battery recycling capabilities can potentially meet all the requirements in the E.U.'s Green Deal.

"Should the Canadian industry scale-up, the European market will have a secure and sustainable place to recycle their batteries and a stable source of recycled metals for new batteries in the future," added Ferland.

Ferland concluded that Canada offers numerous advantages that ensure all segments of the supply chain can meet the needs of some of the largest markets in the world in a secure, sustainable, and stable way. As demand for EVs continues to rise, the country's potential for an end-to-end supply chain offers numerous opportunities for investors.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.