Electric car could attract massive new investment

Joule establishment at an EC IDZ could lead to a battery plant being located in the same zone.

A pre-feasbility study to determine the viability of manufacturing large-cell lithium-ion batteries in South Africa will start in the second half of the year, Engineering News reports.

And with South Africa's first electric car, the Joule, expected to be manufactured either in the East London or Coega industrial development zone, it is logical that a battery plant will be located at the same site.

Large-cell lithium-ion batteries are used in electric vehicles and stationary power storage applications.

Engineering News quotes Industrial Development Corporation (IDC) strategic high-impact projects senior manager Retief Bruwer as saying the study will serve to determine whether it makes economic sense for a partnership to establish such a manufacturing plant in South Africa.

The partnership comprises South African electric car manufacturer Optimal Energy, which is planning mass production of the Joule by 2012, South Korea's Energy Innovation Group, which manufactures lithium-ion batteries, and the IDC.

The project is being driven by the IDC, which is an investor in Optimal Energy and plans to be a shareholder in the battery production facility should the project come to fruition.

"We have already finished the scoping study," Bruwer says.

"Batteries produced at such a plant will be used in the Joule electric vehicle. However, it should not be limited to the Joule. It could also serve other vehicle manufacturers."

The plant's likely production capacity is 20 million cells a year, but this will be verified by the study.

Each Joule car will use about 400 cells.

Bruwer says the pre-feasibility study will also look at the variety of stationary power-generation applications the batteries can be used for.

Lithium-ion batteries are used to around 80% of their capacity in automotive applications, after which they could find a second life in stationary applications or be recycled.

Should the pre-feasibility study yield a positive result, the project participants will move on to a bankable feasibility study, Bruwer says.

He adds that the IDC views the project as a significant economic opportunity, not only to establish a truly South African vehicle brand but also to position the country in this rapidly developing sector of the motor industry.

Also, should battery production be established in South Africa, Bruwer says it will open up a completely new segment in the automotive industry for local manufacturers, while also creating opportunities in a number of spin-off sectors.

"We are talking batteries, power electronics, IT systems and electric drive-motors," he explains

Bruwer adds that the IDC is planning a parallel study to determine the existence of economically viable lithium and other related mineral resources in the ground in South Africa and the rest of the continent.

"We will be looking at anybody who does any value-add to lithium or other minerals that form part of the lithium-ion battery value chain, including the production of other ingredients such as electrolytes and anode materials.