Ohio is Prepared for More Battery Supply Chain Opportunities
Ohio is a Prime Choice for Battery Supply Chain
Ohio’s vast history in the automotive supply chain as well as its overall proximity to resources, manufacturers, and end markets are two key factors making the state an ideal location for lithium battery manufacturers and long-term production. The state’s commitment to innovation makes it a natural fit for the emerging electric vehicle supply chain and electric vehicle manufacturing opportunities. Ohio’s commitment to clean manufacturing with renewable energy and solar energy also makes it a prime choice for lithium-ion (Li-ion) battery manufacturing.
Driven primarily by projected electric vehicle demand, the global lithium-ion battery industry and the battery supply chain are expected to experience compound average growth rates of close to 20% over the coming decades. This creates the need for large scale investment in mineral extraction, chemical processing, anode and cathode production, cell manufacturing, recycling facilities, and the provision of electric vehicle manufacturing component parts and charging infrastructure.
About the Study
JobsOhio, with support from the Natural Resource Defense Council (NRDC), commissioned a statewide study to understand Ohio’s key advantages to attract new investment in the battery supply chain ecosystem.
“As the industry continues to innovate and steer itself towards a future focused on a growing Electric Vehicle supply chain, this report solidifies Ohio’s value proposition as a premier destination for future innovation. JobsOhio was created to help bolster business and investment in Ohio, and our state is prepared to seize future opportunities in the industry that can bring good-paying jobs for Ohio’s workforce while reducing emissions in our state.”
– J.P. Nauseef, President and CEO of JobsOhio
Battery Manufacturing Success in Ohio
Auto OEMs and Lithium-Ion Batteries
One of the areas the study covers is the increasing demand from auto original equipment manufacturers (OEMs) for lithium-ion batteries (LiBs). In early 2017, there were projected to be 17 LiB “gigafactories” (plants capable of producing greater than 1GWh yearly production). That number grew to 261 plants in Q4 2021. However, in the United States there are only four active LiB gigafactories, which leaves opportunity for investment.
With bipartisan support from elected officials and leadership from organizations like JobsOhio, Ohio recognizes the scale of this opportunity and has successfully attracted the $2.3B General Motors/LG Chem joint venture (Ultium Cells) to manufacture electric vehicle batteries. As one of the first states to successfully attract battery manufacturing to complement its already rich history in the automotive supply chain, Ohio now has the potential to become a major regional hub for electric vehicle battery manufacturing in the United States.
Ohio’s Environmental Advantages
The study also explores OEM environmental considerations and the advantages that Ohio offers in renewable energy. Auto OEMs have made it known that they are ready to transition their energy consumption towards renewable energy. This interest in renewable energy is driven by a desire to decrease energy costs and lower the carbon footprint of the automotive supply chain.
To reach this goal:
- OEMs will require renewables penetration growth to occur as close to their operations as possible.
- OEMs will require that their suppliers tap into renewable energy supply to reduce carbon emissions embedded in their supply chains.
With the 7th largest solar labor force in the United States and a rapidly growing penetration of solar energy, Ohio is on pace to help Auto OEMs achieve their renewable energy goals. Promoting Ohio’s renewable energy presence and battery supply chain investment attraction efforts will lead to network effects for future investment attraction. CAM manufacturers will see Ohio as an investible state as they will have access to critical renewable energy supply. This supply will allow them to keep their operating cost down and fulfill their obligations to Auto OEMs’ requests for decreasing dependence on traditional fuel source.
“This report makes clear that Ohio can pursue emissions reductions while creating good jobs and attracting new investment. In fact, it shows that the two go hand-in-hand as the auto sector aims to sell its customers a carbon-free electric vehicle. JobsOhio is playing an important role in bringing new jobs and investment to Ohio while reducing emissions in the state. They understand the value that Ohio’s growing solar energy economy can have in attracting new investment.”
- Dan Sawmiller, Ohio Energy Policy Director for NRDC (Natural Resources Defense Council).
Ohio has several key advantages to spur upstream EV supply chain investment.