Around the world, governments are pursuing accelerated EV adoption as part of the overall net-zero emissions by 2050 objective. Crucial legislation like the Inflation Reduction Act (IRA) in the US, which includes more than $380bn in federal funds for measures that counter climate change, are targeting barriers to take-up of EVs and incentivise manufacturers to address critical domestic battery supply chain gaps.

To bolster EV purchases, the IRA includes a $7,500 point-of-sale tax credit for new EVs, but for American consumers to qualify for the full amount, manufacturers must meet two battery manufacturing requirements. First, battery raw materials must be sourced from North America or a US free-trade agreement partner. Second, vehicle battery components – such as cathode and anode material – must be manufactured or assembled in North America.

Here's where it goes off the road, unfortunately. Most current EV car models do not meet these requirements as the US relies on international markets for battery raw materials and components manufacturing. The IRA is already showing signs of success as automotive manufacturers are investing in US battery production. Notwithstanding, as domestic battery manufacturing expands, it will be crucial that we advance industrial processes that are focused on future market demands – modularity, mass-producibility and reliability, yes, but also sustainability.

Lithium-ion (Li-ion) battery manufacturers will increasingly have to address areas where the conventional process runs counter to decarbonisation and ESG goals, in particular, the cathode active material (CAM). CAM is the most expensive and carbon-intensive component in today’s li-ion battery by a significant margin. Due to high emissions, waste, and cost, conventional li-ion battery cathode manufacturing methods cannot be classified as climate-positive. Upwards of 60% of CAM processing materials are disposed of as waste in the form of sulfuric acid, which has to be transported and disposed of properly, carrying a high cost and carbon burden. Moreover, current cathode manufacturing techniques need billions of gallons of water annually, meaning the depletion of another critical natural resource.

CAM is the most expensive and carbon-intensive component in today’s li-ion battery by a significant margin

Currently, a conventional CAM manufacturing facility can produce only one type of battery chemistry. As technology evolves – sometimes with a game-changing impact on a sector – more operational flexibility will be needed. We have already seen numerous advancements in batteries, and novel battery chemistries are being introduced regularly. Establishing optionality – the ability to produce multiple chemistries from the same factory – to cathode manufacturing would help ensure that EV production stays viable and environmentally sound in a landscape of shifting technologies and scarcity of materials.

Future-proofing cathode production involves devising a manufacturing process built to withstand the pressures of the immediate market demands of today and the advances of tomorrow. For this reason, the next generation of CAM production must incorporate cleaner, more efficient technologies, and use less-processed material inputs – metal oxides and hydroxides instead of metal sulphates – to remove sulfuric acid from the production mix. As well as virtually eliminating waste from the process, this would allow for a wider range of precursor material inputs, meaning a bigger catalogue of critical minerals can be used, a benefit on many levels.

The next-generation process we are working on also eliminates water use, making this method more environmentally sustainable and drastically reducing the industrial footprint needed compared with a conventional CAM manufacturing facility, which requires space for water tankage and wastewater treatment. The smaller facility could mean as much as a 40% reduction in plant capital on an average $350-$400m investment. The lowered expenditure promotes localised production, which reduces transportation costs and further shrinks the carbon footprint of the manufacturing process.

Achieving a lower-cost, more sustainably manufactured EV in the near term is achievable in the US using advanced cathode manufacturing processes. The industrial impact will be critical, as the EV industry is poised to grow more than 23% annually over the next five years and needs to scale up domestic production rapidly. In doing so, we must enact sustainable manufacturing solutions to meet our decarbonisation targets.

· Virginia Klausmeier is the CEO of Sylvatex, a US advanced materials technology company working on next-generation EV batteries