The world of batteries is healed for lithium iron-phosphate cells. This is a cheap and durable chemical that can reduce the price of a vehicle by thousands of dollars. Tariffs and anti-China regulations complicate photos for American automakers.
“I think LFP is a lacking ingredient for energy prosperity. The problem is literally 99% made in China,” Eric McShane, co-founder and CEO of Electroflow, told TechCrunch. “If you have the opportunity to compete, you have to flip that script.”
McShane and his co-founder Evan Gardner have developed a technology that appears to be able to reduce Chinese producers at cost by removing several steps in the production process. If they can deliver, they can reduce the cost of LPF batteries by up to 20% while building a domestic supply chain.
“We saw the whole mining process that starts with rocks and salt water and then reaches lithium chemicals. We were like 10 steps,” he said. “It’s clearly not the best way to do that.”
Much of the world’s lithium is found in underground saltwater. When pumped onto the surface, these salt waters can be treated to extract the lithium contained. The US brines contains millions of tons of lithium, enough to produce millions of EVs a year. The possibility is so great that ExxonMobil is developing an Arkansas site, but the cost of improvements makes it difficult to compete with Chinese suppliers.
LFPs mounted from China are sold today in the US for around $4,000 per metric tonne, which costs around a third of the cost. However, McShane said that once Electroflow comes into full-scale production, the company expects it will be able to produce at least 40% less than Chinese producers while doing that in the US.
“In the V1 system at the end of this year, our goal is to be around $5,000 per tonne production cost point. We’re going to scale up and make this less than $2,500 per tonne,” he said.
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Electroflow recently raised a $10 million seed round. TechCrunch learned exclusively. The round was led by Union Square Ventures and Voyager, and was joined by 50 years and Harpoon Ventures.
The process developed by Electroflow only takes three steps to convert salt water into LFP material. The startup recently proved that the technology worked with salty salt water extracted from pipes on a California geothermal site.
Electroflow’s technology is based on the lithium-ion batteries themselves, but it’s not surprising given that both McShane and Gardner had previously studied batteries and battery materials. “We were really fascinated by the idea of using new technologies, such as battery technology, and applying them to other industries beyond batteries.
But the true inspiration for electroflow came to Gardner one day while he was riding a Cultrain to work in the Bay Area. As people boarded trains from the platform, he imagined them like ions moving between different chambers of the device.
“He sketched it onto a piece of paper and brought it to me,” recalls McShane. “I was like, oh, guys that actually worked.”
The main technology of startups is cells containing an anode that absorbs lithium ions from the brine when operating in one direction and releases another cation into water containing carbonate. Once both passes are finished, the lithium carbonate, ready to react with phosphates, iron, and other reagents, produces LFP powder, ready to ship to the battery factory. For manufacturers who want to make something other than LFP, Electroflow simply stops the process early and sends lithium carbonate.
The system operates completely electric and produces 50 tonnes of lithium carbonate a year, and requires only one household in the United States, McShane said. Water used in the carbonate step can also be recycled primarily. “We don’t use a lot of electricity, we don’t use a lot of water,” he said.
Once the full-size system is completed, it can be packed inside a 20-foot shipping container and produce 100 tons of LFP material per year.
“We can unleash these electrochemical cell stacks and process a lot of salt water throughout the US,” McShane said. He is confident that even in the years since electroflow reached commercial production, the company could weaken Chinese producers.
“Unless the Chinese way changes to a clean sheet solution with a perfect blank slate like we do, they can’t be much lower than this,” he said.