How Battery Traceability Passports Can Improve the Sustainable Material Sourcing for Electric Vehicles (EVs)

With a mission to improve the authentication and sustainable management of batteries for electric vehicles, OPTEL’s battery traceability solution has become a game-changer for stakeholders in the entire automotive industry looking to implement a worldwide battery passport system in the near future.

This blog series looks into the origins behind the importance of battery traceability and how a global battery passport aims to resolve the many ESG challenges mining companies, mineral processors, battery makers, and EV manufacturers face.


Battery Passport


Electric vehicles (EVs) have long been lauded as a viable solution to reshape the transportation sector and fight climate change by significantly cutting carbon emissions generated from their gasoline counterparts. According to the US Department of Energy, EVs convert over 77% of the electrical energy from grids to power themselves, whereas conventional vehicles convert only about 12-30% of gasoline energy.

In fact, they are set to play a major role in the mitigation pathways that limit global warming to below 2 degrees Celsius, which is aligned with the governments, automakers, and other stakeholders that signed an agreement during the COP26 climate conference to accelerate the transition to 100% zero-emission cars and trucks by 2040.

The decarbonization of the automotive industry is definitely on the horizon. Consulting firm Deloitte projects that the global EV forecast is an annual 29% growth rate over the next 10 years. Based on some forecasts, there will be at least 400 million EVs soon after 2040. To support burgeoning demand for EVs, the global EV battery market size will also experience a huge uptick to reach US $154.90 billion in 2028, with a CAGR of 28.1% between 2021 and 2028.

Battery Passport


However, while the future seems to be locked into an energy transition towards EVs, as they do not directly emit any greenhouse gasses, they still have some inroads to make on how sustainable they actually are.

EVs run on electricity that is still generated from fossil fuels in many countries. Substantial energy is also used to manufacture EVs. And one especially important conundrum for players in the EV value chain: how lithium-ion batteries, which are used to power today’s EVs, are actually made and with what types of materials.

To make an EV battery, manufacturers need at least 20 different minerals, including cobalt, lithium, nickel and other rare earth metals. Based on estimates from the International Energy Agency (IEA), at least 30 times more of these minerals will be required to meet the 2040 climate targets.

The IEA’s Sustainable Development Scenario (SDS) also foresees that the total volume of minerals required to develop clean technologies, namely EV batteries, is set to skyrocket; the SDS indicates that demand for lithium and nickel alone will grow by 43 and 41 times, respectively. As stated in a recent World Energy Outlook report, the IEA indicated that the conversion to the electrification of vehicles marks an unprecedented “shift from a fuel-intensive to a material-intensive energy system.”



Current EV batteries, as previously mentioned, rely heavily on various minerals. Unfortunately, many of these minerals are developed using dubious practices that have profound environmental and social impacts, including:

  • Greenhouse gas emissions and unchecked mining waste from conventional mining and mineral processing activities
  • Loss of biodiversity, water pollution and depletion, air pollution, and water contamination
  • Social disruption caused by changes to land use and forced displacement
  • Government corruption and misuse of natural resources
  • Human rights abuses, such as child labor, lack of basic worker health and safety, adverse working conditions, social injustices towards girls, women, and other disadvantaged groups, and modern-day slavery (human trafficking)
  • Artisanal or informal mining practices in remote regions that exacerbate societal and environmental issues

For example, mining companies in the Democratic Republic of Congo, which is rich in cobalt and home to one of the largest and purest untapped cobalt reserves in the world, have been accused of exploiting children and other stark human rights abuses. Human rights violations of Indigenous peoples living near lithium mines have also been called out by Amnesty International.

Other examples of all types of social concerns with respect to mining minerals and metals for EVs are rampant. The Responsible Mining Foundation purports that very few mining companies worldwide take human rights seriously and even fewer have strategies in place for risks, such as “water rights, Indigenous peoples’ rights, land rights, resettlement, workers’ rights, security forces, and child labor.”

With regards to the environmental ripple effects of mining, there are many “dirty little secrets” as well. A case in point? The way lithium is mined is far from being environmentally friendly. More than half of an EV battery’s lithium comes from the Lithium Triangle’s salt flats, which are located between Chile, Argentina, and Bolivia. To extract lithium, it takes over 500,000 gallons of water (2 million liters) for one ton of the metal, which can be devastating to local ecosystems and agriculture.

In another attempt to increase mineral supply capacity for EV batteries, some countries are working together to implement international regulations for deep offshore seabed mining. According to many scientists, this can lead to the destruction of habitats, loss of species and entire ecosystems, pollution from toxic by-products, the emergence of dangerous plumes, and more.

These are just some of the many downsides to mineral extraction for EV batteries.


Case Study: Global Traceability for the Canadian Aluminium
Battery Passport


There is good news on the horizon to regulate and even minimize the use of certain minerals in EV batteries.

Due to the rising costs of critical minerals used in EV batteries, such as lithium and nickel, in part due to supply shortages, battery- and automakers are turning to new sourcing approaches and technological innovation.

Long-term supply agreements between EV makers and more sustainable mining companies and cell companies are also being concluded. For example, BMW recently inked a deal for sustainable lithium from mining groups in Australia and Morocco

Other automotive giants, battery makers, and research centers are also investing heavily in designing ways to make better EV batteries—either with new technologies, minerals or using the valuable metals recovered from recycling batteries

Tesla, for example, has been open about phasing out its reliance on cobalt. And the EV maker is far from alone. Some advances in EV battery technology are helping to reduce the need for cobalt for next-generation battery cells, which foster high nickel, low cobalt ratios or kickstarting a complete transition to lithium-iron phosphate (LFP). Solid-state batteries, which cannot currently be scaled and are still quite expensive, nevertheless offer a compelling future alternative as they are made with solid electrolytes that use non-toxic, readily available, and recyclable materials.


Perhaps the strongest and more short-term solution comes from government policymakers, investors, industry leaders, and consumers, which are pressuring mining explorers and developers as well as battery and EV manufacturing companies to provide a complete battery history—also known as a digital passport. This passport would include detailed information on where each EV battery is made, the origin of its components and materials, etc.

The goal is to leverage this digital passport to require industry players to adhere to national and international regulations in order to achieve official sustainability goals, obtain permits and government grants, access key markets, and safeguard their brand equity.

Global policies are aligned along the same vein.

For example, the European Commission is pushing for new legislation for a digital battery passport, which, among other things, will provide complete end-to-end traceability of every single EV battery on the market—including the materials used to make each one—by 2026. This framework for battery regulation is viewed as a positive step forward to make mining more sustainable for the EV industry.

During a 2020 annual meeting of the World Economic Forum, 42 major organizations from the mining, chemicals, energy, and automotive sectors around the world agreed on 10 guiding principles, outlined by the Global Battery Alliance (GBA), to develop a more sustainable battery value chain by 2030. And this more sustainable value chain starts with a global Battery Passport platform.

The GBA’s Battery Passport, developed in conjunction with organizations along the complete battery value chain, will initiate a digital ID for an EV battery that is comprised of comprehensive information on its origins, manufacturing history, and ESG performance.

The Battery Passport will also require that digitals systems within the entire value chain be interconnected to collect, aggregate, share, report, and analyze data that will, in turn, be used to inform policymakers, governments, NGOs, and consumers as well as enable mining companies and manufacturers to develop performance benchmarks and hit their ESG targets.

Providing end-to-end visibility and transparency is truly the first step to achieving more responsible, sustainable, and ethically sourced EV batteries minerals. It is important to note that a battery passport also offers many other advantages, including how to extend the battery’s life as well as the most appropriate means for recycling or safe disposal.

Stay tuned for the second article in our series!

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