LONDON, Ontario and VICTORIA, British Columbia, Sept. 14, 2022 (GLOBE NEWSWIRE) — With the U.S.’s new electric vehicle tax credit requiring that EVs and their batteries be made in North America, Canada’s EV battery supply chain is in the spotlight.
That spotlight is well warranted. If Canada plays its cards right, a domestic EV battery supply chain could support up to 250,000 jobs by 2030 and add $48 billion to the Canadian economy annually.
That’s according to modelling from Clean Energy Canada and the Trillium Network for Advanced Manufacturing, whose new report, Canada’s New Economic Engine, explores how Canada can successfully build an EV battery supply chain in order to become a North American battery powerhouse.
Recent months have seen a stream of new battery investments, from the $5 billion Stellantis and LG Energy Solution are investing in a Windsor battery factory to the $500 million General Motors and Posco are investing to bring battery material production to Bécancour, Quebec.
But despite these encouraging investments, the success of Canada’s EV battery supply chain—and the hundreds of thousands of future jobs it could support—is still largely dependent on swift government action.
In a scenario where no additional government action is taken, Canada’s battery supply chain would create just 60,000 jobs and contribute only $12 billion in GDP—fulfilling only about a quarter of both its jobs and GDP potential.
Accordingly, the report identifies six ways in which Canada should focus its efforts to fulfill its battery-building potential. While Canada could do it all, a more effective strategy would double down on a few key stages, such as EV assembly, battery cell manufacturing, clean battery materials production.
In short, we have a once-in-a-generation opportunity to build a battery supply chain that will be the economic engine of tomorrow’s economy.
Here’s what Canada needs to do:
- Develop a strategy: Canada needs a public-facing, national battery strategy that pulls existing efforts together, connects dots across the battery supply chain, and guides industrial development.
- Build the workforce: Canada is home to one of the world’s top talent pools but is faced with worker shortages and challenges ensuring the right talent is in the right place. Canada must develop new strategies to engage and mobilize big populations of skilled workers.
- Accelerate project development: Canada faces significant competition in securing additional battery supply chain investments. Canada should focus on lining up project land and infrastructure needs while creating predictable and efficient review processes for projects across the supply chain.
- Grow the North American market: Canada must support and expand policies to increase domestic EV demand and uptake.
- Promote Canada’s clean battery brand: Canada should continue promoting its many clean battery advantages—including low-carbon critical minerals, proximity to the U.S., a cutting-edge battery research and recycling leadership, and abundant clean electricity—to attract investment into its battery supply chain and increase export opportunities.
- Scale up homegrown clean battery leaders: Canada is home to a host of innovative battery technology companies. The next step is to leverage existing investments from multinational battery cell manufacturing companies to also support domestic companies.
“Canada has all the right ingredients to be a battery powerhouse, from the necessary mineral resources to leading cleantech companies. But it’s vital that Canada acts swiftly and decisively, or it risks squandering thousands of jobs and billions of dollars.”
—Evan Pivnick, Clean energy program manager at Clean Energy Canada
“The opportunity to build a fully integrated EV battery supply chain is in front of us. The work has begun, but there is lots more to do. Better integrating Canada’s mining and manufacturing industries can yield massive economic and social benefits, but will require a level of government support—and political willpower—that we have not seen since the 1960s.”
—Brendan Sweeney, managing director of the Trillium Network for Advanced Manufacturing
- By 2030, Canada’s EV battery supply chain could support nearly 250,000 direct and indirect jobs and add $48.2 billion to its economy. When induced jobs are considered (for example, employees at a restaurant popular with supply chain workers), a total of nearly 323,000 jobs could be created across Canada and $59 billion added to the Canadian economy.
- Between 2020 and when the analysis underlying this report was finalized in June 2022, Canada attracted at least $1 billion related to EV battery mineral extraction and materials manufacturing, $5.2 billion related to EV battery cell and module manufacturing, $6.6 billion related to EV assembly, and $1 billion related to EV battery components and recycling.
- Since June 2022, Canada has seen additional major battery announcements, such Umicore’s $1.5 billion plan to construct a cathode active battery materials facility in Kingston, Ontario, and recent deals with Volkswagen and Mercedes-Benz to secure Canadian EV battery raw materials while cooperating in other areas such as battery manufacturing.
- Canada ranks among the world’s top five countries when it comes to battery supply chain potential, largely due to its access to key metals and minerals.
- The global market for batteries will be worth at least US$360 billion by 2030. By 2040, the International Energy Agency projects demand for critical minerals to grow by at least 30 times to meet rising demand for batteries used in EVs and storage.
Report | Canada’s New Economic Engine