Tesla this week broke ground on a lithium refinery in Texas in the company's latest move aimed at ensuring a sufficient supply of critical materials for the manufacturing of its cars.
It is also part of a plan to expand Tesla's presence across the EV supply chain, Reuters noted in a report on the news.
The refinery should be up and running by next year, and ready to ramp up a year later to an annual output sufficient for the production of 1 million EV batteries.
"As we look ahead a few years, a fundamental choke point in the advancement of electric vehicles is the availability of battery grade lithium," CEO Elon Musk said at the ceremony.
Texas Governor Greg Abbott praised the project, noting this would make the state self-reliant with lithium processing.
Tesla will invest $375 million in the lithium refinery, to be located in Corpus Christi. The company plans to use a new method of lithium refining that is less polluting because it does not produce sodium sulfate as a byproduct because it uses sulfuric acid in the refining process.
"Instead, the byproduct is a mixture of sand & calcium carbonate-a viable additive in the production of construction materials, allowing us to make use of this waste stream," Tesla said, adding "In the future, we will also process other intermediate lithium feedstocks, including those from recycled batteries & manufacturing scrap."
As for where the lithium for the new facility would come, Musk said Tesla will continue to buy the raw material from its current suppliers, which include Albemarle, Livent Corp, and Piedmont Lithium.
At the same time, Musk recently begged entrepreneurs to enter the lithium refining business. During a Tesla conference call, the CEO of the company said "We're begging you. We don't want to do it. Can someone please?"
By Charles Kennedy for Oilprice.com
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