The future of Canada’s clean energy industry is on stage this week in Calgary at Energy Disruptors: UNITE 2024. Among the leaders sharing their knowledge at the conference is Chris Doornbos, the President and CEO of Calgary’s own E3 Lithium.
E3 Lithium is a trailblazing lithium development company unlocking Canadian lithium brines for the global electric vehicle (EV) market. Last month E3 Lithium partnered with Pure Lithium to advance the design of a lithium metal anode and battery pilot plant in Alberta.
Doornbos addressed the enthusiastic day-one audience with a presentation about the rapidly evolving landscape of electrification and why critical minerals are a crucial element driving Canada towards a sustainable and energy-independent future.
His insights shed light on both the technological advancements that make electrification possible and the complex geopolitical factors that influence it.
Energy Independence: A Key Driver of Electrification
Doornbos emphasized that while sustainability remains a primary motivation, energy independence has increasingly become a central theme in the conversation around electrification. He pointed out that China plays a pivotal role in supplying critical products, such as batteries, EVs, and solar panels, which are fundamental to electrified living. Despite benefiting from China’s cost-effective exports for decades, Western countries have recently cast China’s influence in the supply chain in a negative light—reflecting a growing desire for self-sufficiency.
Energy and Wealth: An Inseparable Link
“A nation cannot achieve prosperity without access to energy,” Doornbos noted, illustrating the undeniable link between energy consumption and economic growth. He referenced the significant investments countries are making in expanding energy production, highlighting that China produces three terawatts of electricity today, with plans to nearly double this capacity, including substantial renewable energy investments. In contrast, the United States consumes around 1.3 terawatts, and Canada, by comparison, generates about 0.6 terawatts.
Global Competition in the EV and Battery Industry
Discussing the global race for leadership in the battery and EV industry, Doornbos highlighted that China currently produces 80% of the world’s batteries and 60% of all electric vehicles. Although China does not dominate lithium mining, it controls 78% of the lithium refining process—an essential step for battery production. He also mentioned CATL‘s rapid rise as a major battery producer, showcasing the competitive landscape that is evolving around these critical technologies.
Critical Minerals and the Shift Toward Local Production
The concept of “critical minerals,” including lithium, has gained prominence in discussions about energy independence. Doornbos explained that Western governments are increasingly focused on securing stable supplies of these minerals, which has transformed the landscape of battery production. He cited Alberta as a potential hub for battery manufacturing, thanks to its access to lithium and supporting infrastructure—a clear sign that countries are looking to bring production closer to raw material sources.
Leapfrogging to Electric Vehicles
Doornbos observed that many developing countries are bypassing traditional gasoline-powered vehicles and transitioning directly to electric cars—a pattern reminiscent of how nations leapfrogged landlines to adopt mobile phones. Chinese electric vehicles, being exported to these regions, are offering millions of people their first experiences with EVs, further driving global electrification.
This trend, however, has sparked competition. Western nations are working to develop alternatives to Chinese imports, introducing terms like “onshoring,” “friend-shoring,” and “near-shoring” in an effort to create resilient, localized supply chains for EV and battery production.
Onshoring and Inflationary Challenges
As part of this push for localized production, Canada has rolled out incentives to attract multinational corporations to establish battery and EV manufacturing facilities. Similarly, the U.S. Inflation Reduction Act (IRA) aims to bring critical production home through subsidies and direct funding. Ironically, Doornbos highlighted that despite the IRA’s name, these measures are likely to drive inflation due to increased production costs—a trade-off for achieving energy security.
Protectionism and the Future of EV Adoption
Recent tariff increases on Chinese cars by the U.S. and Canada, reaching up to 100%, effectively block Chinese vehicles from entering these markets. Doornbos questioned whether this protectionist stance aligns with the goal of accelerating EV adoption, especially given the shortage of affordable electric vehicles in the $20,000 to $40,000 range. He suggested that more affordable options could significantly boost EV adoption, leading to faster infrastructure development and advancing the broader electrification agenda.
Questions for the Future of Electrification
As Doornbos concluded his presentation, he posed four critical questions for reflection:
- Is Domestic Production Essential? Should Canada and the U.S. aim for full self-sufficiency in battery production, creating an end-to-end electric supply chain instead of relying on imports from China?
- Is Protectionism Hindering Progress? Is it worth slowing down EV adoption in the name of protectionism, potentially risking competitiveness? The CEO of Stellantis has voiced concerns that tariffs may make Western automakers less competitive—are we willing to accept this outcome?
- Are We Ready for Inflation? Onshoring will likely lead to higher costs and increased inflation. Are we prepared to bear this cost for long-term security and independence?
- Can We Balance Innovation, Sustainability, and Affordability? Can we simultaneously innovate, ensure sustainability, and make products affordable? Or have we created challenges that our ability to innovate may not be able to overcome?
The Path Forward: Navigating Complexity with Collaboration
The journey to an electrified future is both complex and promising. Issues of energy independence, sustainability, and global competition are deeply intertwined, and the decisions made today will shape not only the energy sector but the broader global economy. As Doornbos concluded, collaboration, innovation, and a willingness to think critically will be key to determining how competitive the Western world remains in an increasingly electrified future.
