Canada emerges as global EV battery leader with billions in investments

March 30, 2023 (MLN): Canada is making a significant push into the production of batteries for electric vehicles as the world moves towards emissions-free driving, as reported by APP.

The country is promoting tax incentives, abundant critical minerals, and clean energy to attract multinational corporations. The efforts of Canada appear to be paying off, with companies such as Volkswagen, Stellantis, and LG Energy Solution opening plants in the country, and more than Can$18 billion in investments attracted to the sector.

This has positioned Canada as the second-largest battery manufacturer globally, just behind China.

The Canadian government has introduced a 30 percent tax credit for new machinery and equipment used to manufacture clean technologies, and mine, or recycle cobalt, lithium, nickel, and other critical minerals used in EV batteries. The move is part of the government's plan to make the country a major player in the production of batteries for electric vehicles.

Canada's Industry Minister Francois-Philippe Champagne has said, "This is not just a new chapter. It's almost a new book we're writing on the automotive sector in Canada."

The country has all the minerals necessary for the production of batteries, and the proximity of its mines to battery factories and auto assembly plants in both Canada and the United States is a significant advantage.

Canada has also taken advantage of its abundant and cheap hydroelectricity, which is one of the lowest-polluting and cost-effective sources of green energy.

According to government data, 99% of Quebec's energy is clean. Canada is hoping to tap into some of the billions of dollars announced by Washington for electric vehicles, batteries, and renewable energy projects.

The recycling of electric batteries is also a focus for Canada as it seeks to create a circular supply chain. Several factories are already in place in Canada, which makes it possible to recycle 95 percent of the strategic metals present in a battery while using "97 percent less water than extraction and refining per ton of battery material" and polluting less.

The demand for essential minerals is expected to quadruple or even increase sixfold by 2040, according to the International Energy Agency. As a result, Canada will need to maintain a "sustained, accelerated pace" to keep up with other countries.

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