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The Power of Lithium in South America
Zicari, Julián; Fornillo, Bruno
The Power of Lithium in South America
Entreciencias: diálogos en la Sociedad del Conocimiento, vol. 5, no. 12, 2017
Universidad Nacional Autónoma de México
Available in: http://www.redalyc.org/articulo.oa?id=457650040006
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e Power of Lithium in South America
La energía del Litio en Sudamérica
Julián Zicari * sanlofas@hotmail.com
CONICET, Argentina
Bruno Fornillo ** bmfornillo@gmail.com
CONICET, Argentina
Julián Zicari, Bruno Fornillo.
e Power of Lithium in South America
Entreciencias: diálogos en la Sociedad del
Conocimiento, vol. 5, no. 12, 2017
Universidad Nacional Autónoma de
México
Se autoriza la reproducción total o parcial
de los textos aquí publicados siempre y
cuando se cite la fuente completa y la
dirección electrónica de la publicación.
Esta obra está bajo una Licencia Creative
Commons
Atribución-NoComercialSinDerivar 4.0 Internacional.
Received: 18 July 2016
Accepted: 21 October 2016
DOI: /10.21933/J.EDSC.2017.12.197
Redalyc:
http://www.redalyc.org/
articulo.oa?id=457650040006
Abstract: A central cause of global environmental change is the emission of CO2
emitted by the energy matrix, predominantly based on fossil fuels. As a result, we must
face an "energy transition" supported by renewable and sustainable sources. Lithium
batteries would contribute to this completely renewable energy system, as they could
serve to traction transport, act as a sustainable energy reserve (which is mostly electric),
and enable the mobility of multiple devices. In South America we find 80 percent of
the most profitable lithium reserves in the world, in the "Lithium Triangle" formed by
the Andean salt flats in Argentina, Bolivia and Chile, which generates the enthusiasm
to participate in the emerging energy carrier. In this context, we will explore the world
market of lithium and batteries, the overall situation of its exploitation, and the attempts
to create a link between the Southern Cone countries with lithium reserves and their
various attempts to manufacture lithium-ion batteries.
Keywords: Lithium-ion batteries, South America, Mining, Energý.
Resumen: Una causa central del cambio ambiental global reside en la emisión de CO2
emitidos por el tipo de matriz energética predominante, basada en combustibles fósiles.
A raíz de ello, es preciso encarar una “transición energética” que se soporte en fuentes
renovables y sustentables. Las baterías de litio contribuirían a este sistema energético
completamente renovado, ya que podrían servir para traccionar los transportes, oficiar
de reserva de energía sustentable (que es mayormente eléctrica) y posibilitar la movilidad
de múltiples dispositivos. En Sudamérica se encuentra el 80 por ciento de las reservas
más rentables de litio del planeta, en el “Triángulo del litio” que conforman los salares
andinos de Argentina, Bolivia y Chile, lo cual genera el entusiasmo en participar en la
emergente carrera de la energía. En este marco, repasamos el mercado mundial del litio
y de las baterías, la situación general de las explotaciones y los intentos por generar una
articulación entre los países litíferos del cono sur, así como sus diferentes intentos por
fabricar las baterías de ion-litio.
Palabras clave: minería, baterías de litio-ion, América del Sur, energía.
Introduction
e "energy equation" is a global problem, and one of the most important
in outlining a diagnosis over the course of the global geopolitical
components today. Even more so, considering that the civilizational
model based on the consumption of hydrocarbons reveals limits that
are as much as close as they are dangerous (Klare, 2008). Indeed,
we are witnessing the slow but safe creation of a new world energy
order: Restrictions to the "easy access" (due to "shrinking resources" and
concentration of supply), ecological consequences of their exploitation
(accounting for 56% of the greenhouse gases emissions recorded on the
planet), increased demand of the Asia-Pacific economies; these are just
some of the coordinates of the current scenario (Servin, 2012). If nothing
is done, nothing will change this situation; that is, on a global scenario
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of "continuity of policy", by 2035 global temperatures will rise 6 degrees,
making it impossible to predict the consequences. Only a reduction in
the demand for fossil fuels, rapid and sustained fall in energy intensity
(the amount of energy required per point of GDP ), and a decline of
CO2 emissions would make it possible to expect a scenario in which the
temperature goes up "only" 2 degrees compared to the pre-capitalist era
(AIE, 2011). Under these conditions, if the "energy issue" is a central
cause of global environmental change, it also represents a key lever for its
solution.
Rich in natural resources, the Southern Cone stores in the salt mines
of the highlands copious amounts of lithium, the basic raw material for
the production of energy reserves that will be key to a post-fossil society.
A cell phone, a notebook, a tablet—all functioning through the energy
of lithium-ion batteries; without them a satellite would not go into orbit
and spacecra would not survive. Naturally, millions of cars burning fossil
fuels across the planet could be replaced by electric or hybrid vehicles. e
price difference between pure raw materials and the battery is significant:
a ton of lithium carbonate costs around USD $6,000, while a car battery,
which uses about 10 kg, ranges between USD $10,000 and $20,000. But
the potential of lithium does not end here. e "transition" towards a
sustainable energy system will require endless reservoirs of energy. Indeed,
a society based on alternative sources must have decentralized storage
modules, public systems and electric mobility, smart grids to calculate
the energy used, stored and produced at home; lithium batteries would
also be useful for all these. Lithium is, therefore, a mineral located at
the heart of an ecologically sustainable society, with clean energy and
technological innovation, which helps to avoid ecological and social
dangers that threaten the nascent century. In short, combating climate
change requires moving towards a sustainable energy system, in which
lithium batteries will play a central role, entailing electricity reservoirs and
sources of traction.
e abundant possession of lithium in the countries of the Puna (Peru,
Bolivia, and Argentina, which together have 65% of world reserves)
awakens an illusion of the possibility to exercise significant influence
on the market of raw materials as well as in the production of complex
lithium-ion batteries. Consistent with this spirit, visions have been
spread that the "Saudi Arabia of lithium" is being conceived here, saying
that a few countries—Argentina, Bolivia, and Chile—are the privileged
possessors of "white gold" or "oil of the 21st Century.". Most academic
studies and journalistic articles in our region have focused on the benefits
of having the raw material. We propose another special emphasis on the
necessary coordination between transformation of the energy matrix, the
battery industry, scientific knowledge and regional policy, to highlight a
model of renewed development for the region.
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Central points of the world battery market
Any idea of industrializing and producing lithium batteries in the Puna
region should start with the consideration that today the "Asian factory"
is the main exporting hub. Japan and Korea have thus far been the
pioneers in the research and development of this type of production,
while China entered the market only as a producer of lower cost and
quality batteries, but managing to also develop more than 100 local
manufacturers (Ministry of Economy 2011: 10). Lithium carbonate
imported by these three Southeast Asian countries amounted to 51.5%
of the world total in 2013. In the same year, the region reached nearly
19% of electric lithium battery exports, or 45% if we add countries that
function as re-exporters of those countries for tax issues (Singapore, Hong
Kong, and Indonesia) (see Table 1). In other words, those three countries
consume almost half of the global lithium carbonate to export almost
an equal percentage of batteries and battery electricity, occupying an
increasingly prominent place in the market. is share reached from 40%
to almost 50% between 2001 and 2013 when world production almost
tripled (indicating that they grew at a faster rate than that offered by
the world market, and leading its expansion). China, Korea and Japan
compete among themselves, which is one of the causes that contributes
to depreciating the cost of batteries. If the production of batteries then
is relatively narrow, it is further reduced if we consider the chance to
manufacture all the technical components. According to engineer Juana
Olivares, manager of a Bolivian prototype factory attempting to produce
batteries in the region "in fact no country has the capacity to produce all
components required, a country like China must import the separating
membrane from Japan, which is the only country with the material and
the necessary technology for over 20 years" (S/D, 2014: 1). is is the
main reason why, for Latin American countries, the possibility of full
battery manufacturing seems to be a difficult dream.
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Table 1
Exports of lithium batteries in total values (in thousands
of dollars) and by country (in %) (2001-2013)
Source: own elaboration based on TradeMap data.
In the future, the automotive industry and its flagship companies will
be key actors in the process. In this case, the virtual depletion of oil,
rising costs and/or pressure to move to a paradigm of "green energy",
prompted the automakers to lead a race to find a new manufacturing
process to produce electric cars, which has been slowly growing. us,
in 2007 there were 500,000 units of electric cars when the total world
car production was 73 million units (Cochilco, 2009: 7). erefore, a
small amount covered merely the 0,68% market share, although numbers
have been slowly growing. In the central countries -dominant countries
economically speaking-, none of the governments want to stay behind in
what is presented as the future of the automotive market, as technological,
labor, industrial and economic benefits are immense. erefore, several
countries are actively promoting the different companies to research and
develop electric cars. For example, the United States Department of
Energy has allocated US$ 2,400 million in subsidies for the development
of batteries and electrical components for driving through the American
Recovery and Reinvestment Act of 2009; US$ 940 million from that
amount (almost 40%) must be allocated to the production of Li-Ion
batteries. e live (Logistics for Implementation of Electric Vehicles)
project plans to convert the Barcelona metropolitan area to the use of
electric vehicles through the City Council, several companies and ngos
(Ministry of Economy, 2011: 43). e German government has also
provided supplies and support in a similar direction with the objective of
producing one million electric vehicles in 2020 (Aguilar and Zeller, 2012:
21).
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However, even if they can develop new technologies, the future
of lithium cannot be tied exclusively to this. Although growth of
the transportation industry can become its most dynamic engine, we
must not exaggerate the role that lithium can play. On the one hand,
although lithium is a central component of the industry, becoming almost
irreplaceable -it is not a coincidence that the type of battery planned to
be used is called, precisely, Li-ion- it is also true that the weight of the
natural resource on the value chain is minor. In fact, to produce an electric
car battery under current technology and value, it takes between 7 and
15 kilos of lithium, this being a cost ranging merely between 42 and 90
dollars per vehicle. However, the final value of a battery is between 8 and
18 thousand dollars, and given that lithium as a raw material, reaches a
proportion close to 0,5% of the total amount (see Table 2). erefore,
if one considers that the batteries are only part of the total cost of a car,
the weight that occupies the lithium in the final value is thus very low.
at is why the automakers do not seem to care about the price of the
resource, but they only conceive of it as the small supply they would need
in the future. In this case, companies do not seek to have a monopoly of
raw materials or be uneasy for the evolution of its price, because very little
lithium is needed and even smaller is the capacity of it to influence in the
final price of the vehicles.
In this scenario, most companies (whether European, Asian, or
American) have decided to use as the main strategy to conform a
partnership with various transnational mining companies by financing
their projects such as exploration and development with the sole purpose
of having access to the resource safely for long periods, ranging from
20 to 50 years. It is obvious that any company will not develop a longterm plan of multimillionaire technological restructuring without the
confidence of the provision of inputs that it involves (Muscatelli, 2010).
In Argentina, this type of strategy is fully shown. us, the Japanese
automaker Toyota has partnered with the Australian miner Orocobre
Ltd. to exploit the Salar de Olaroz (Jujuy). Magna and Mitsubishi (also
from Japan) partnered as well in the Salar de Cauchari (Salta) to mining
Canadian Lithium Americas, while Korean automaker Kores partenered
with Lithium One (Chinese-Canadian mining) to develop the field Sal de
Vida in Catamarca (Sevares and Krzemien, 2012: 141). us, automakers
are a fundamental agent of the marketing chain but in no case claim
exclusive control of lithium as their contracts with mining companies
concern only part of the total production of lithium leaving them free to
sell the product.
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Table 2
Battery type by car and the incidence of lithium in the cost
Source: own elaboration.
In short, the truth is that the battery market is pivoting to the Asian
axis, which produces at relatively low cost and which controls key inputs.
Moreover, the percentage of lithium in the total price of the battery is
lower; hence, the great global production chains are only interested in
ensuring their supply. Having reviewed the overall global scenario, we will
now focus on the market for the raw material.
e lithium market
It is very difficult to predict the future, even more in a complex
and changing era as the one we are living. But we know one thing:
satellites, spacecra, renewable energy, rechargeable batteries of cell
phones, camcorders, tablets and digital cameras, pacemakers, atomic
reactors, electric vehicles, antidepressant drugs, glass and ceramics, all
of them use lithium as an essential element. So, it is very probable that
the carbonate of lithium will be demanded in the world and it is very
likely to increase further in the future. However, forecasts should not
be exaggerated when it comes to lithium because there are many other
elements to consider.
Firstly, we must say that the previous dynamics, which have been
giving lithium an increasingly important place, correspond only to the
current process of historical accumulation, which is as contingent and
precarious as any other. e process of technological development is
centrally conditioned by how nature is politicized. Technological cycles
that govern us have demonstrated an unusual capacity to revolutionize
and transform the world becoming increasingly limited and dynamic in
time cycles, lasting less and less. Only the current level of development and
technology have laid the conditions for lithium to have an increasingly
central role but these conditions can change and disappear at a faster rate,
even to the one with which they arrived. Many factors could transform
delicately: the conditions of access to lithium could be facilitated making
the price fall, allowing the use of every country in its own way (as resource
tenure is not monopolistic). 1 erefore, the goods which demand it as
input can become obsolete rapidly, as well as the technology that promises
to seek it in the future could never be consolidated and, if so, it could
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easily find a substitute. e latter is especially true when one considers that
the replacement of fossil fuels faces a long list of candidates contesting
its relief: hydrogen batteries, biofuels, batteries, zinc-air and even new
supplies almost unknown, based on "rare earths." In this sense, there is an
over-reliance on lithium, for example, when considering it a wealth of an
equal grade as fuel oil, when the real value is that the lithium battery is
a young technology and not fully consolidated. erefore, what should
loom as central of lithium is not the recovery process itself of the resource.
e central question is the effort to industrialize, add value and achieve
the manufacturing of batteries locally; exploiting comparative advantages
of the countries that already have the raw material. In this sense, we
must consider that the place of lithium in the mining sector in the
world is almost nonexistent. Argentina, for example, a country that has
become the third largest producer, only held 1.14% of the national mining
production in 2011, according to the Ministry of Mining of Argentina.
erefore, it is easy to realize how limited the market is and, that even if
it grows, it will remain limited. Only in car production or energy storage
for large-scale national power systems more lithium than what we need
today would be necessary. However, if this happens, reservoirs that are
profitable today to a lesser extent, as the extraction of lithium contained in
certain stones, would become profitable; in fact, it is a mature technology
that makes of Australia the second largest exporter.
e current market for electric cars has slowly been taking shape
that projects certain crystallization, especially regarding lithium. e
automaker Toyota Motor Corp. (Japan) has so far been the leader in the
production of electric cars, controlling about 80% of this market, which
it has been dominating since 1997 when it released its first electric model
for sale. In turn, Toyota’s associations with other Japanese electronics
companies like Panasonic and Sanyo have also allowed them to lead the
sale of batteries for electric cars. ese conditions have given technological
advantages in the market, forcing other automakers to enter into the
electric age under their license Hybrid Synergy Drive ® (such was the case
of Ford, Subaru, Mazda, and Nissan). At the same time, General Motors
launched the Chevrolet Volt in 2012, ranking second in sales of electric
cars while in alliance Renault-Nissan are to launch the Nissan Leaf electric
vehicle in 2015. Similarly, Volvo, Hyundai, Kia, Mercedes Benz, Seat
and Tesla Motors also have plans to launch their electric models soon
(Ministry of Economy, 2011: 41). By 2025 it is expected that electric cars
would occupy 20% of the automotive industry. 2 ese figures imply,
according to an estimate by Signum Box, that the demand of lithium
(chart 1), only for the production of cars, will be 60 and 180 thousand
tons for the years 2020 and 2025 respectively, taking into account what
the different models of cars will demand and the number of them that
will go on sale. 3 Meanwhile, the market for energy storage allowed
by lithium is very important, since if the so-called "clean energy" (solar,
hydro, wind, etc.) is imposed in the future, it will be indispensable to
have accumulation sources and storage for it; in this context lithium
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technology projects to become more efficient in this regard, and its market
is projected to acquire the same dimension as the market of car batteries.
Chart 1.
Estimated tons of lithium carbonate demand required for various uses (in thousands) (2011 - 2025)
Source: FMC (2011: 9).
us we have one market that holds the previous dynamics of increase,
growing 10% to 11% per year (base trend), one optimistic scenario
with a growth of 15% annually, and one conservative scenario with a
growth rate between 5 and 6%. us, under the three scenarios presented,
lithium consumption ranges between 400 and 600 thousand tons by the
year 2025. is is double or triple of what is required today, without
representing a market of great size. Of course, all projections are only
estimates, incidentals cannot be predicted, as it was the financial crisis
of 2008 that brought down the consumption. ese are exercises only
intended to approach possible scenarios. Moreover, according to the
different looks, the consumption of lithium will inevitably increase and
this would generate both new conflicts and opportunities. However,
making further speculations with a view to other variables is still harder.
Moreover, only the future can tell what the region will make in the long
run.
e OPEC of the Southern Cone
It is necessary to focus on the initial part of the economic chain in
the Southern Cone. e opportunities for the region are large because
Bolivia, Chile and Argentina all have 55% of world reserves of lithium and
87% of reserves in brines, which is the most profitable way to extract the
mineral (Table 3). Similarly, having the resource has not been hitherto
sufficient for the creation of supranational institutions; each country
has different strategies of insertion in the world lithium market. In this
sense, for now, Chile's interest lies in exporting the raw materials in their
primary state, seeking to control the price and the market (Chile is the
main exporter in the world of carbonate, followed by Australia and then
Argentina) and shows no intention of making the battery and neither
of building a sort of "Lithium OPEC " or "Opproli" (Organization of
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Exporting Countries Lithium); it is closer to the free market promoted
by the Pacific Alliance (Cochilco, 2009). Nevertheless, Argentina’s and
Australia’s strong entry into production, the corruption scandals linked
to transnational corporations connected to extraction, and the great
benefits obtained with the advances in the value have led to attempts
to analyze the role of lithium carbonate producers (Lithium National
Commission, 2015). Nevertheless, what is happening in Bolivia is, far
more interesting, since the government has decided to hold tight control
over half of the world reserves of lithium in brine until it can produce the
battery (Echazú, 2015). Today, to achieve this, the State is investigating
its own ways of extracting lithium, a task that it is not finding quite
easily, since it is technically more difficult than in neighboring countries
due to their lower overall concentration and precipitation that delays
the evaporation. erefore, the pilot plant announced which would
produce lithium and potassium has not yet started its operations. e
business plan for lithium in Bolivia entails State control throughout the
chain, only partnering at the stage of battery production with foreign
companies. Finally, in the Argentinian case, FMC is based in the Province
of Catamarca since 1998. It exports 17,000 tons of lithium carbonate per
year. fmc entered into the production of the Salar de Olaroz in 2014,
owned by Orocobre and by the state-owned company JEMSE of the
province of Jujuy, which owns 8,5 percent of the enterprise. Regarding
the exploitation of the salt flats, Argentina is governed by a privatizing
"mining code" and it does not hesitate to weight and welcome the
initiative of foreign companies (it is worth mentioning that the Province
of Jujuy has declared lithium a strategic natural resource).
Table 3
World reserves of lithium by type and country (tonnes)
Note: (1)In the original source contained 5,500,000. We've updated.
Source: Cochilco, 2009: 11.
Now, there are not a few voices committed to create a "Lithium OPEC
", taking advantage of the high concentration of the resource that exists
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in South America, in order to control their dynamics and price. In
principle, everything that contributes to greater coordination between
the countries that own the resource in the Altiplano is certainly welcome.
However, attempts to build a "Lithium OPEC " on the basis of the Andean
triangle that stimulates any pressure to force the "technology transfer"
or to have control of the lithium market, face a series of obstacles.
Firstly, mining and neoliberal Chile shows little interest in it, so it
will continue to export lithium no matter who buys it, wrecking all
expectations to constitute a sort of oligopoly. Secondly, Bolivia has not
expressed great enthusiasm in an OPEC that brings her close to Chile,
given the historical discord that has existed between the two countries
since the War of the Pacific. irdly, as we have recently reviewed,
Toyota—one example among thousands—owns 25 percent of the Salar
de Olaroz, and nothing indicates that the Argentine government will
reverse this or other holdings. Finally, another important limitation
for the creation of a supranational institution has to do with to the
unequal jurisdiction of the tenure and resource management of lithium:
while the central state of Bolivia and Chile possess the resources (and
are unitary countries) in Argentina lithium belongs to provinces (and
there are three that have lithium: Salta, Jujuy and Catamarca, with very
different plans and positions from one another). erefore, coordination
on this matter experiences yet another pitfall, let us imagine a future
scenario in which the industry of lithium batteries consolidates and the
Southern Cone countries decide to nationalize the raw material and
shape a joint regional strategy. Undoubtedly, being the largest producers
of brines in the world, they will have some ability to influence the
market value of the commodity. However, as described, the percentage
and value of lithium within the battery is lower, so that companies
producing energy storage only seek to ensure its supply beyond what
they should pay for it, and can get it from many sources. us, if the
price of raw materials increases substantially, other exploitations would
start to be profitable which still today they are not or they are so but
only to a relative extent, so prices would tend to fall. Indeed lithium
is not "unevenly distributed", it is possible to obtain lithium in many
parts of the world (ranked 27th among the most abundant on the planet,
there are over 150 minerals containing lithium, even in the sea); that
is to say, lithium is a strategic resource but it is not oil or rare earths.
Currently, the European Union no longer considers that its supply of
lithium is in danger (GT ad hoc , 2014). In view of the foregoing, in
geopolitical terms, there is no doubt that everything that contributes to
higher levels of South American integration will be a good omen, but the
key of lithium power to combat global environmental change and create
a new model of development is not only in the simple control of the raw
material, but primarily on advancing battery manufacturing. 4 We seek
here to assess the unique relationship that exists between the different
actors who play a role in the extraction operations. We begin from the
evidence that salt flats are located in the Puna Altiplano inhabited by
indigenous communities settled in the region for millennia. Above them,
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the activities of transnational corporations and the different jurisdictions
of national states are superimposed on a complex interaction between
state and society. Community action in relation to the conversion of
lithium into "white gold" has been heterogeneous. Both in Argentina and
Chile the "landing" of multinational companies had receptive responses
due to local spills of lithium that allowed the economy as well as others to
be openly hostile. Indeed, due to environmental liabilities, consumption
of water, the lack of participation in the management and profits, and
competition with other activities such as livestock breeding and tourism,
particularly strong in the Salar (salt flats) of the Chilean Atacama, the
communities have organized themselves to counterweight the purely
mercantilist vision of the territory (Bolados Garcia, 2013). For example,
the 33 communities grouped in Salinas Grandes in Argentina, managed
to stop any attempt to exploit lithium through a multifaceted strategy
that in its legal aspect came to the Inter-American Court of Human
Rights. In this sense, they are in tension and have different ideas and
narratives on how to conceive the territory: if for the communities
it represents their historic home, based on its economic and symbolic
reproduction, for companies it is a simple mineral deposit. Moreover,
most of the time, the nation-states are inclined towards a type of
management that favors the creation of conditions conducive to the
"investment climate", exceptionally taking the Plurinational State of
Bolivia, which has decided to control the mineral.
e geopolitics of lithium in the Southern Cone
If the problems faced by a joint strategy in the Southern Cone for
marketing are not small, neither is the strategy of those who see the
chances of a lithium industry dedicated to the manufacturing of batteries.
Overall, in the planet there is no absolutely proven lithium battery
capable of enabling a similar performance to that provided by fossil fuels,
to the point that it is possible to replace them. Today, the current lithium
batteries have less power than fossil fuel, a discrete maximum autonomy
(between 100 and 250 km), require a long charging time, are quite large
and heavy, and carry the risk—certainly not innocuous—of burning.
Because of this, the central countries are spending large sums of capital to
overcome these shortcomings.
Creating a lithium battery requires multiple steps, from which the
region has just taken the most basic ones to , have lithium carbonate and perhaps not even that one and to some extent has pursued the last
of these series of steps. More specifically, from point zero to the battery
there are at least four basic steps: 1) have the natural resources, where
lithium is strategic, but not the only one, elements such as cobalt is even
more so; 2) processing these chemicals, which could be called "the passage
from lithium carbonate to the compounds", that is, make the salts, among
other chemical elements that are required for the emulsion that contains
the battery, 5 3) produce the "physical" elements of the batteries, its
"heart" It implies, for example, to make the cells, which requires "strategic
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supplies" as separators, of very difficult composition; 4) final assembly of
the battery. 6 As mentioned above, relatively speaking our region is able
to carry out the first of the steps in an industrial way in spite of the lack
of cobalt, for example- and also the last step, but not the core or more
difficult steps. 7
Despite having the largest amount of proven reserves and economically
profitable, Argentina, Bolivia and Chile still have a way to go to
help a post-fossil society. In this sense, it is necessary to provide a
minimum scenario of public policies, particularly those deployed in the
three Southern Cone countries around the passage to get the "lithium
batteries." We mentioned that Chile is not interested in making batteries
since it is a traditional mining country and the fact is that it currently
has technical capacity and prefers to buy the low price offered by their
unregulated market in addition to not having a high demand. us,
its refusal to make a strong strategy of added value is correlated to the
neoliberal policies of the Andean country, focusing on carving strongly in
the world price of single lithium carbonate. In this sense, Chile is carrying
out a simple experiment: not even proposing a substantial addition of
value. However, in recent times the country has started to realize that this
strategy should coexist with other incentives aimed at adding value and
greater state control of the lithium exploitation. 8
Bolivia has proposed itself to reach the production of energy storage.
e industrialization strategy has increasingly leaned towards the
structure with foreign partners, but erratically. e partnership with
Korean Kores-Posco in 2012 seemed profitable since it is one of the
largest battery production companies and shows itself willing to make a
significant technology transfer. However, this "society" is at risk due to a
problem of patents and differences regarding the control of the resource,
which is why the company will have greater extractive presence in
Argentina, particularly in Salar Cauchari-Olaroz. Meanwhile, Bolivia has
purchased a pilot battery manufacturing plant from a Chinese company,
Linyi Gelon New Battery Materials Co., and made an agreement with
the Netherlands that will provide training and a laboratory "turnkey" for
accumulators. 9 e problem faced by these attempts is living in a sort of
" factory fetishism " because it is not enough with it without the "business
environment" and the "scientific-technical environment" in which you
must be registered to operate effectiveness. In short, among the challenges
to be overcome by the Andean-Amazonian country are the lack of local
expertise, enough capital, market for batteries, all of which does not
detract from the fate that has commanded the opposite alternative to
being a mere producer of raw materials, project from the far Potosi
has always tried successive times with obvious results. In this context,
everything that contributes to the integration between Argentina, Bolivia
and Chile would be particularly encouraging.
Furthermore, the industrialization of lithium is an important objective
of the national state of Argentina. Around the year 2011 an interministerial committee that acted as articulator between a number of
scientists engaged in research of lithium batteries; they were interested
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in producing business (Pla-ka) and a potential market in the provision
of batteries was established for the "connect equality," which distributes
computers in middle-level schools. Unfortunately, this commitment has
had many twists and turns that would not be possible to describe here.
It was not fructiferous, primarily because it failed to supply the suppliers
of computers. Aer this initial setback, with the creation of the company
YPF Tecnología, constituted by the recently nationalized YPF and the
National Council of Scientific and Technical Research (CONICET), oil
came into play. With this new venture, the set of scientists who know
of battery production have moved their research here. However, beyond
the commendable efforts of the scientific wing, it still remains pending a
State assumed policy that is planned, coordinated, interdisciplinary, and
agreed upon to overcome the recurrent obstacles faced by the existing
attempts. In the deployment of active public policy lies a central key
because in Argentina there are companies with experience in the field
of battery assembly. "Production" of electrical appliances which requires
accumulators (netbooks, cell phones, etc.), promising areas (lithium
batteries for bicycles, motorcycles, cars), a scientific network in operation,
a policy area that can coalesce to achieve objectives. In sum, there
are certain structural conditions of scientific, economic and political
environment that can accommodate the chances of making batteries.
However, we assume that the attempt by a single peripheral country, as
Argentina, may most likely not be enough (Fornillo, 2015b).
Finally, the dominant countries and their flagship companies do not
have any interest in decentralizing production processes, technology, or
cutting-edge knowledge. In fact, it is quite the opposite case—they make
great efforts to prevent the loss of control of these production processes
as the bulk of earnings now come from the "innovation rents", i.e. , those
technological border goods that allow them to "surround" market shares
(Miguez and Sztulwark, 2012). Is it possible that a calculated windfall
could lead an electric car to sell at a competitive price as compared to
a regular car? Following from this situation, all that is decentralized is
obsolete technology. It is not by way of "seduction" of global giants that
we will have batteries or parts thereof in the South. Although it may be
necessary to make some connection to "complete" a local process, and
at this point several options appear, although China appears to be the
most receptive country. Moreover, one thing is production in the hands
of a transnational corporation and another one is a technological process
based on strong local roots.
Towards a South American scientific-industrial joint
initiative
We live in a planet involved in a process of geopolitical and ecological
"transition" where nature is at the service of a new field of accumulation
and financial recovery under an extended "privatization of resources."
us, accelerated and continuous consumption of vital natural resources
have increased progressively their value on a daily basis. Given the
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Julián Zicari, Bruno Fornillo. e Power of Lithium in South America
destructive entropy and the type of metabolism of capital itself, the
existence, operation, and transportation of natural resources will slowly
draw a new "geography of conflict." In this context, South American
countries are under the pressure to restore the classic inter-industrial
exchange: these are markets with high added-value products and
technology while at the same time they "export nature," key to the
externalization of environmental costs of the central countries; globally,
the cards are dealt. In a given point, at the time of adding value to
lithium, it become less important to come from the countries where the
raw material is used than to come from those capable of making use of
innovation revenues, and in this aspect the world areas who are most
important in production, technology and innovation Southeast are Asia
as well as the United States and a few European countries which are more
and more besieged by the competition to the Asian power. e "Lithium
OPEC " conformed by Argentina, Bolivia and Chile do not make great
sense if it remains tied to the control of extraction and exploitation, to
which dominant countries would condemn us. If we finally define the
concept of Natural Resource Strategy, we must accept that the status of
the "white gold" is relative, and, therefore, we must pay special attention
to another geography.
Indeed, rather than speaking of "Saudi Arabia" or the " OPEC " (or
"Opproli"), images that continue to refer to the presence of the raw
material in the Altiplano highlands, we believe it is accurate to speak
of "Lithium in South America". At best, each country makes its best
efforts, such as Argentina could eventually produce lithium batteries,
but the local market is not very large and it would be very difficult to
compete internationally. Potentially, we understand that when thinking
about the possibility of generating a commercial framework that supports
the demand for batteries and an accompanying scientific and technical
environment, it would be desirable to draw a regional strategy that
includes Brazil, brandishing a public policy of continental character.
Although this scenario is a long term one, in this way it is possible to
think of a potential large enough battery market in more states with more
resources, in a still strong export industrial platform, and in the possibility
of splitting and coupling manufacturing processes; in sum, there would be
a chance to think about economies of scale in manufacturing that allow
insertion in the world market. As in other areas, the South American
integration is presented as one of the most dignified way that can be
approached. us, it is here where thinking about a lithium industrial
fabric robust enough to meet US production, or those more powerful
in Southeast Asia (in Asia there are centers of innovation, increased
production of batteries, giant automakers, as we have shown). We are not
talking about a minor attempt; on the one side, it is not easy, but on the
other, its centrality lies in that the lithium batteries today are intended
to be key to the energy future of the planet, both for electric cars and for
post-fossil storage systems.
anks to lithium batteries, the possibility of participating in the
nascent technological pattern opens then the sustainable energy carrier
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as well as a significant potential market. e opportunity is not minor: it
is to combat climate change, contribute to creative development models
and gain economic and political sovereignty. Lithium is just a prism
through which we can glimpse a possible way of making a transition to
an alternative economic and social model. It must—as Koldo Unceta
holds—discard the axioms of "growth" supported in the increase in the
GDP to adopt a post-growth approach that values human activities in
relation to their contribution to welfare (Unceta, 2014). A post-growth
logic involves a commodification strategy (reduce the market sphere),
dematerialization (lower flow of energy and materials), decentralization
(reduction and decentralization of the production scale), and the "energy
of lithium" if politically well conducted, can certainly contribute to it.
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Notes
1
2
3
4
5
6
7
A recent case in the direction of change of lithium mining techniques was
called “cones techniques” that would allow lowering the brine evaporation
process, which may delay between 8 and 12 months, but with new techniques,
it would be reduced to just one week significantly reducing costs and
processing times. Moreover, China and Korea are experimenting techniques
to extract lithium from the sea, although it is not easy. Finally, an Argentine
scientist, Dr. Calvo, already patented a form of lithium production that would
not require water.
ere are three ways and they could be seen in Aguillar and Zeller (2012: 22),
FMC (2011: 9-12) and Ministry of Economy (2011: 42).
For example, the Toyota Prius battery plug-in requires 3.6 kg of lithium
carbonate, the Mitsubishi-iMiEV between 10 and 15 kg, while the Tesla
Roadster will require between 40 and 50 kg per unit (Desormeaux, 2012).
For a definition of lithium as a strategic natural resource and potential
"income" of the raw material see Fornillo (2015a).
Note that the European Union made a paper on those considered "Critical
Natural Resources", measuring their "criticality" according to their economic
value and supply risk, and lithium has a risk of 0.7 and cobalt 1, 1 in a table
that goes from 0 to 5, this high level rightful alone to the "rare earth". (GT adhoc, 2010).
For a good description of the chemical and physical elements required to
assemble a battery, see Andreotti (2012).
Certainly, if the region can make critic and nuclear steps battery (points 2
and 3), it would have a battery produced in the region, but to give at least
one of them needs a) very sophisticated machinery and technical capacity, b)
knowledge and scientific use, design or "reverse engineering" patent, which the
central cares very much -a Chinese businessman confessed to an Argentine
scientist "We were never going to give licenses to manufacture batteries" -,
c) of course, capital needed to invest though the sums are not very high.
However, the realization of the process does not end with the happy presence
of the battery. Assuming a good equation to allow manufacture it locally,
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8
9
they have to be sold at a competitive price to a market willing to buy them.
us, given the constantly changing patterns of energy storage market, it
is a requirement that all the above steps are performed robustly to always
bordering the "technological frontier". If all these obstacles are overcome we
can have consolidated industry battery production in South America. It is
clear that the problems are not minor, but that does not mean we are, by far,
in the most interesting scenario.
During 2015 a "National Commission Lithium" produced a report
recommending to the executive government that the state has a greater
presence in the holdings of lithium, partnering with private companies
(Lithium National Commission, 2015).
e agreement entered into with the Netherlands assumed that the Technical
University of Del trains Bolivian professionals who work in a laboratory
for the development of batteries; the Dutch company -Energy InnovatorsBTI will be responsible for designing and building the factory; Da Vinci
Laboratory Solutions support in organizing the laboratory; Boon consultant
will coordinate the efforts of the different partners. It is said that Bolivia will
pay $ 45 million for the laboratory, factory, and technical assistance.
Author notes
*
Becario doctoral CONICET. Magister en Economía.
Licenciado en Psicología (UBA), Economía (UBA), Historia
(UBA) y Fiolosofía (UBA), Investigador del Instituto de
Estudios de América Latina y el Caribe (IEALC-UBA).
**
Doctor en Ciencias Sociales (UBA) y en Geopolítica (Paris
VIII), Investigador del Instituto de Estudios de América Latina
y el Caribe (IEALC-UBA).
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