Lie Shi: 0:03

In order to make batteries, nowadays there's money to support manufacturing, support material development, or even mining. But there's no money for equipment developers. All the equipment still have to come in from the Far East. We thought that, AMB is in a unique situation to close that gap for American supply chain to be robust and sustainable.

Tom Raftery: 0:29

Good morning, good afternoon, or good evening, wherever you are in the world. This is the Climate Confident podcast, the number one podcast showcasing best practices in climate emission reductions and removals, and I'm your host, Tom Raftery. Don't forget to click follow on this podcast in your podcast app of choice to be sure you don't miss any episodes. Hi, everyone. Welcome to episode 159 of the climate confident podcast. My name is Tom Raftery. And before we kick off today's show, I want to take a moment to express my gratitude to all of this podcast's amazing supporters. Your support has been instrumental in keeping this podcast going, and I'm really grateful for each and every one of you. If you're not already a supporter, I'd like to encourage you to consider joining our community of like-minded individuals who are passionate about climate. Supporting the podcast is easy and affordable with options starting as low as just three euros or dollars a month. That's less than the cost of your coffee. And your support will make a huge difference in keeping the show going strong. To become a supporter. I simply click on the support link in the show notes of this or any episode. Or visit tiny url.com/climate pod. Now. Without further ado. With me on the show today, I have my special guest Lie. Lie. Welcome to the podcast. Would you like to introduce yourself?

Lie Shi: 1:53

Yes. nice meeting you again, Tom. This Lie Shi. I'm the CEO of AM Batteries. We are both based in Boston area.

Tom Raftery: 2:02

Okay, Lie, and tell me a little bit about AM Batteries.

Lie Shi: 2:09

Wow. Okay. And I'm trying to make it short. AM Batteries develop a new way to make a lithium battery electrode and which is a component and to make a lithium batteries. And we're addressing one particular issue is not using solvent to make a electrode. And this is a very interesting combination. Actually, I want to explain. That the lithium battery is a clean energy. When people drive a car, you, if you have a lithium battery, it's very clean, very quiet, but the process to make a lithium battery can be dirty. So that's why I call this a clean energy, but the dirty process is a very strange combination. This is a where that AMB come in and we make electrode without using solvent and save energy and also make the environment and the process much cleaner. So that is a nutshell of what we're doing.

Tom Raftery: 3:06

Okay, great. I watched. It's probably, I dunno, is it a year and a half or two and a half years ago now? Back in September, I think it was 22, maybe it was 21. With the, the lockdowns and everything. My time has become a little bit accordioned, but the, the famous Battery Day that Tesla ran, as I say, it was either September 21 or 22, uh, where they talked about their new 4680 battery and the fact that it was going to be manufactured without using a solvent and how much better and what a big advance this was going to be. Is this the kind of thing that you are talking about? Is it the same kind of process?

Lie Shi: 3:50

Yes, yes. Actually, this is just an excellent reference because Tesla actually bought a company, Maxwell, and they are using this dry process to make electrode for ultra capacitors. So different application, but the Tesla was able to buy this company. And actually they sold Maxwell out to super capacity companies, but kept this dry battery electrode process. And finally, last year, maybe two years after that big battery day announcement, they finally commercialized at least a portion of the technology. In the battery there's anode and the cathose. They have commercialized the process to make anode without using any solvent. That's a major breakthrough. And all the advantages that Tesla or Elon Musk claimed actually start to be realized by the people. And this is the domain we are actually working into. And so this is very exciting and that's why sometimes I call Elon Musk the best PR person for AM batteries, because we don't need to convince anyone else that a dry process electrode could work in lithium batteries.

Tom Raftery: 5:04

Okay, great. For anyone who didn't see that battery day announcement, can you explain to people listening why a dry battery or a solvent free battery process is better than a process that uses a solvent?

Lie Shi: 5:20

Okay, this is getting into a little bit technical, maybe a little bit boring, but let me try it. And you making this electrode and, you have a battery, has a positive and negative for electrode. And to make this electrode, people use a chemical called N-methylpyrrolidone. Short term is NMP. Okay. This is a very, capable solvent. They dissolve all the materials and allow the active material, some binders and some conductive material to be mixed together. Then you use a coating process to coat this material onto a current collector. Then you go through the removal step, remove all the solvent, then you recover the solvent for future usage. So the whole process is very energy intensive. You have to think of big equipment, usually is a hundred meter long a football size equivalent. Have to coat the material, then remove the solvent, and recover the solvent. So it's very energy intensive. Use a lot of space versus the dry process. You do not use any of those solvent. All you do is putting this dry materials together. Of course, require a lot of good engineering work, then condense them, then put them onto current collectors. And it take maybe only 50% of energy required to make a conventional batteries if you use a dry process. So that is a nutshell. Save a lot of space, save a lot of energy, and do not use solvent.

Tom Raftery: 6:59

And the NMP solvent, is it toxic?

Lie Shi: 7:04

Yes. And there's a interesting story last week because I was talking with a potential customer who want to build a a pilot line in Seoul, Korea. And outside Seoul apparently there's economic belt and a lot of manufacturing companies want to attract good people. They have infrastructure. Then when they're trying to build a line, they find out they cannot use this solvent in this economic belt zone. And so they came to us. They heard you guys have a dry process, then I can buy your equipment, put in this economic zone without getting any issues with the environment agencies so they can, could get a permit very quickly. Same thing in Europe. The usage of NMP is regulated, so certain areas cannot use it. In the US EPA about 12 months ago put out a announcement that, this NMP material is unreasonably risky for human health and they have made the final decision how to regulate it. But the trend is we need to be more cautious about all these chemicals we're using today.

Tom Raftery: 8:18

Okay, so if this dry process uses far less energy and no solvent, what's or what is, or is there an implication for the batteries that come out at the other end? Are they, first of all, are they cheaper because there's no solvent and there's less, far less energy? Or are they more expensive because it's a different process? And is there an implication as well for their, their cycle lifetime? You know, that they, how long they last?

Lie Shi: 8:51

Yeah, very good question. This is a word that engineers and the professor scientists has spent many years on this technology at AM batteries before they start to respond and build a company. And the two professors has work on the electrochemistry part of this chemistry, and they have proven that by using the right formula and the right particle size, the performance was not sacrificed at all. That's why AM Batteries has start to move into additional scientific work, which is making this dry process made better even better than the conventional one, while working with different material vendors to develop more advanced material tailored for this dry process. Because over the last 30 years, most materials developed trying to work with the wet process, and now we have a dry process. Initially we just benchmark against the wet process, finding out the performance can be equivalent. Now we've become more ambitious. We want to develop better materials, even better than conventional. That's number one. Number two is overall cost wise, we felt we can reduce the cost by 10%. And just including everything. And if you build a gigafactory, used to be a hundred million dollars now, and, it'll be $90 million. So it's a very substantial change considering how difficult it is because all the low hanging fruits are taken. And this technology has been around for 20 years. So this is saving on the equivalent or better performance is really making this technology very attractive.

Tom Raftery: 10:38

Oh.

Lie Shi: 10:38

And a little bit scary for people. That's why some people call it, oh, this is too disruptive. What do I do with all the equipment I have? So we have to find out the business solutions around those things.

Tom Raftery: 10:50

Okay. And if someone is using this technology to make their batteries, does it limit the battery chemistries that they can use? You know, 'cause there's, there's now sodium ion batteries as well as lithium ion. There's NFP, there's all, all other kinds of combinations. So is, is that a limiting factor?

Lie Shi: 11:09

So, just thinking what we are doing is putting all these particles onto current collector using electrostatic process. It's a very, you know, physics 101. You go to a classroom, then the teacher start to put the, a student to rub maybe less on the hair, then this, certainly they start to stick up. That is the electrostatic we knew. But the point is we need to usually work with a semiconductive or insulative material. That is only requirement. That's why it is agnostic to LFP, NMC, sodium ion, silicon anode, and all those things are applicable. The only thing I say today we cannot work with is the lithium metal batteries. So instead of lithium ion, instead of lithium in the carbon, if you use lithium metal a hundred percent, then we cannot handle that anode material. But we can help you with cathode because cathode is still semiconductive material that people are using is metal oxide material.

Tom Raftery: 12:17

Okay.

Lie Shi: 12:18

Very good question, Tom.

Tom Raftery: 12:19

Thank you. And, You are taking out the solvent addition and the solvent extraction steps from the process, but then by definition, a different process. Is it a process that is more or less complex? If I'm a manufacturer, does this mean? Yes, I've taken out those two steps, probably more than two steps, but let's say just those two main steps. But does, does that mean at some other juncture I'm adding in three or four or five new steps to actually make it a more complex process? Or is it a simpler process?

Lie Shi: 12:58

Overall, I think the manufacturing process including, electrode, has six major steps and, we are actually maybe removing two and three steps. So that is overall step are reduced in terms of engineering aspect and there's a certain complexity. But related to electro static deposition, and maybe I can talk, because we're dealing with the powders and the particles, how to manage them and put them onto the current collector requires some art and require some engineering require a lot of physics. So that part is the more complex. But overall, it is something that while we have a world class engineer team working on this and trying to resolve the issues. And right now I have to confess the uniformity of the material. It is not as good as the electrode made with the wet process. That is something we have to improve.

Tom Raftery: 15:09

Okay. Interesting. And AM Batteries, it's not that you are actually a battery manufacturer. What you are is a manufacturer of equipment for battery manufacturers, correct?

Lie Shi: 15:27

Yes. You capture this extremely well. Actually, we have internal debate whether we should change our name so we're not misleading people and as of today, you are correct a hundred percent. We are a equipment manufacturer. And we are supplying equipment to battery makers so they can make batteries more efficiently and taking less space. And another thing that I want to say that in this lithium battery supply chain, and there's another gap that we are observing. I know the US government has put in a lot of monies and into this domain, but one area which is, neglected so far is the equipment piece. In order to make batteries, nowadays there's money to support manufacturing, support, material development, or even mining. But there's no money for equipment developers. All the equipment still have to come in from the far East. We thought that, AMB is in a unique situation to close that gap for American supply chain to be robust and sustainable.

Tom Raftery: 16:36

Okay. I'm reminded of a cartoon of the, I, I think it was from the time of the gold rush in the Yukon in the US in the 19th century and it's, you have all these guys.'cause it was guys at the time, all these guys going along with pickaxes going out looking for gold. And in the background you have a guy with a pickax store with loads of money 'cause he's selling pickaxes to all the miners. It strikes me that it's kind of analogous to what you are doing. You're selling the, not pickaxes in this case, but manufacturing equipment to the battery manufacturers, you're, you should be hard, you should be raking in all the money while they're going out and making all the batteries.

Lie Shi: 17:23

I hope that's the case. And also you forgot that usually people on the pickup truck, pick up trucks on those days or maybe on the horses usually carry guns as well to protect themselves because that is a very violent time as well. And in our case, it is a very crowded area already. And because Tesla has come in and, made a statement that dry battery electrode process can work. So a lot of people is following the Tesla process, and in our case, we have a very unique process and we felt that it is equally or even more competitive and there's a certain support to AM Batteries. Were, we're fortunate and we don't have, tons of gold in our truck, but actually we're getting a lot of good support from Toyota Ventures, Porsche Ventures and all those major brand names. And also we have capital investors, mainly, from the Wall Street and which is supporting us. So we do get our share of the support, but in the end, we have to deliver. We have to have the good engineer, the equipment to actually help people to make the electrode.

Tom Raftery: 18:35

Okay. Fascinating. And what is the biggest bottleneck right now? Is it finance? Is it finding customers? Is it technology? Is it resources? As in people with skills, you know, where are you there?

Lie Shi: 18:53

I think, the main thing, If you ask, different people have a different solution or response. Some people felt it is the customer side and because they are viewing a new technology, they're very suspicious. And do, they want to take the risk on the new technology. Right? And so. But I felt this is a technology driven company and I felt the bottleneck is in the engineering aspect. So if anyone listen to your podcast and they'll think, oh, I'm good enough, please gimme a call and we'll take a look at you.

Tom Raftery: 19:28

And if I am a battery manufacturer today, and I'm looking at your technology, it it requires far less energy, doesn't require any solvent, fewer steps in the process. Does that mean as well that my factory can have a smaller physical footprint?

Lie Shi: 19:47

Yes, that is definitely a major appeal of this technology and the people come in, especially the people are planning to build a greenfield factories and they are very much like the idea now, I can use my space to do a lot of other things. And with the brownfield it is more difficult because they have equipment maybe already designed in place. Trying to swap out all this big equipment than putting in a new line is less attractive. You are correct

Tom Raftery: 20:18

Okay. And does this have any implication as well for the end of life of the batteries? As in, you know, when they come to end of life, when they're at 80% or less of original capacity? can they be as easily, more easily, less easily recycled?

Lie Shi: 20:41

This will be, on this part, I have to confess it's equivalent. It's the same. Because we are, we're in the equipment business and we're trying to make equipment less energy intensive and do not use solvent and take less space, but the material and whether it is recyclable, what is a cycle life? It really depends on the battery makers. Do they have the best design and do they have the right chemistry such that people can recycle it easily?

Tom Raftery: 21:15

Okay. Interesting, interesting. And

Lie Shi: 21:18

Yeah. We don't have a silver bullet for everything. Yeah.

Tom Raftery: 21:22

Yeah. but I mean, at least you're not saying that it has a negative impact on recyclability, so that's good. That's good. Good. Okay. Cool.

Lie Shi: 21:32

Okay, maybe I can, just ask you a few questions just one or two questions because recently I was reading an old book about president Roosevelt, who put in the New deal. And I start to start to think, actually we're in the era of Green New Deal. Okay. I know that, a few congressmen pushed for Green New Deal four years ago, didn't pass the Senate, but overall, actually, that is the world we're living in. That's why I, I did some, I was a physics trained person and I like to look at the numbers sometime and I realized, the Green and the New Deal at the time, you know, 1930 something, and the government actually only put 1% of GNP into the economy and made dramatic impact on the whole society. So this is, another, maybe a hundred years later, the government is doing the same and trying to be more involved in the economic activities of the USA And the amount of money maybe is still at about 1% of, all I think last year the GNP reached the 27 or 30 trillion, and 1% of that is 300 billion. And that is what the government is planning to spend on this renewable energies. So I think, overall, I'm just supportive of this, what government is doing. I think we, in the era of Green New Deal and government is getting involved in the economy, you know, positive way and this time has a spin on the green part.

Tom Raftery: 23:13

Nice.

Lie Shi: 23:14

Uh, it's just a thought. What do you think about it?

Tom Raftery: 23:17

Yeah, no, I mean, it makes sense. You're, you're talking about the Inflation Reduction Act, I think, and

Lie Shi: 23:23

Yes, there's a, and also another one is bipartisan infrastructure law. And both of them, I bundle them together, is kind of a green new deal in my mind.

Tom Raftery: 23:35

Yeah, no, it, it, it makes sense. There's, there's been a lot of investment in the EU, in the US, and as well in China. So the, the three kind of major global economies in the energy transition. In fact, if you look at the numbers coming out of China, the amount that they have spent on building out electric vehicles, be it, personal vehicles, be it buses, the, the bus fleets in China are nearly all fully electric. The, as well, the renewable energy that's being built out there is amazing. I mean, they're building more per quarter than the rest of the world is per annum. It's, it's phenomenal in terms of the, the solar and wind particularly. The EU, I think I saw that 44% of the energy in the EU in 2023 came from renewables. And that's just because

Lie Shi: 24:38

Oh, that's a very high

Tom Raftery: 24:38

Yeah. Yeah. And, and it's, it's because, there's been this massive investment off the back you know, I'd like to say it was for green reasons, but a lot of it was thanks to Putin's invasion of Ukraine. People looking for more energy security, more so than any kind of real green commitments. But there, there has been money available for that from the, the EUs Green New Deal. And as you say, the Inflation Reduction Act and the Infrastructure Act in the US have contributed a lot of investment opportunities as well. I think both in the EU and in the US, one of the big problems that's common to both areas is not so much a lack of money, but it's a problem with the regulations around the rollout of new renewables, getting connections to the grid, getting permissions, those kinds of things, and that's holding back a lot of the renewables, a lot more would be rolled out were it not for those kind of regulatory hindrances. But no, you're, you're, you're, you're right. There's, there's a huge investment happening right now in the, in those three major global economic areas that we talked about, and it's heartening to see. We still need a lot more, because you hear a lot of people talking about their targets for 2025. 2025 is 10 months away. You know, it's, it's not some time way off in the future. It's 10 months away for 2025, which means 2030, which is the other big, you know, target that people have is just over five years away.

Lie Shi: 26:20

Yeah, just around the corner also. Yes. yeah. This is, maybe I call it complicated reality, that a lot of things has to happen, not only, through money at the industry, but actually have to, policy wise, regulation wise, has to be, sparked. Has to be smart. Otherwise, so you're trying to spend money on here, but the regulation says you cannot do this. Then it's just counterproductive.

Tom Raftery: 26:47

Yeah, exactly.

Lie Shi: 26:48

Yeah. I hope we have smart policy makers and also a lot of industry expert need to help the government to structure the policy. You know, mostly constructive way

Tom Raftery: 26:59

Yeah, on that front, I'm quite optimistic, as in I think a lot of, a lot of big industry now from what I'm seeing is getting on board with their 2030 goals. The investment community is starting to put pressure. Banks are starting to put pressure. Insurance companies are starting to put pressure. The shareholders are starting to put pressure on companies as well. Employees in companies are starting to put pressure. Customers of companies are starting to put pressure. So, you know, companies are starting to get pressure from all sides and regulations on top of that again. So I think industry is starting to play a, an increasing role in this, and that can only be a good thing because it's where a lot of emissions come from.

Lie Shi: 27:45

yep. I think maybe even the mentally people pass that percolation point that, we have to do something together to make it happen.

Tom Raftery: 27:54

yeah,

Lie Shi: 27:55

But a lot of collaboration has to happen between the industry, government, and even among all players in the same supply chain or even outside the supply chain

Tom Raftery: 28:04

yeah, yeah. I.

Lie Shi: 28:06

It's an exciting

Tom Raftery: 28:07

I run another podcast. It's called the Sustainable Supply Chain Podcast, and it is a fascinating area as well because for most organizations, their Scope One and Scope two emissions, they're, they're kind of internal emissions are 10 to 20% of their total emissions. So, you know, if they, if they get them down to zero. They still have 80% of their emissions, what's called their Scope three emissions, which is their emissions from their supply chain, which they haven't touched. So hence the Sustainable Supply Chain podcast is a, a fascinating space for me.'cause I'm always hearing stories from that space.

Lie Shi: 28:48

You have to look at the whole spectrum to see where the carbon footprint are being taken. Yeah.

Tom Raftery: 28:54

Yeah. Yeah. And there's a, there's a lot of room there for smart sourcing and getting your emissions down by selecting your suppliers based on their emissions reporting. So

Lie Shi: 29:06

Yes.

Tom Raftery: 29:07

anyhow.

Lie Shi: 29:08

Yeah, especially European companies are taking a lead on that Yeah, when we were discussing with one of the customers, the first question is, show me your carbon footprint and your emission numbers

Tom Raftery: 29:20

Wow.

Lie Shi: 29:21

And even when we make equipment, we have that issues, so we have to deal with that as well

Tom Raftery: 29:25

Good. That's good to hear.

Lie Shi: 29:26

But definitely on that front, the European is a taking a lead, but, I think the, Infrastructure Bill and also IRA bill is really create a major excitement in the US to the point that the European felt, they are certainly felt left behind a little bit because used to be maybe China and the European will lead the effort. But in the last three years things have start to happening in the US and a lot of talent, a lot of energy and a lot of money are being spent in the US.

Tom Raftery: 30:01

Yeah. No, that's good to hear. That's good to hear. Great. Lie, we're coming towards the end of the podcast now. Is there any question I did not ask that you wish I did, or any aspect of this we haven't touched on that you think it's important for people to think about?

Lie Shi: 30:17

Well, people just need to be also patient at the same time. And even in the lithium battery supply chain and in the recent months, there's a certain companies, when the rubber hits the road, they realize they are not delivering the result. And as you some company promise 2024, they will have a commercial gigafactory productions. One it's getting around 2024 people are expecting is not happening. So I just want to caution people in the supply chain or outside the lithium battery domain, just be patient because this building up the whole industry takes times. It require a lot of engineers. Now we have more engineers in electrochemistry. Just as four years ago when we were trying to hire one electro chemist who know how to build a battery, it's very difficult. But now, four years later, a lot of colleges offering special electrochemistry class, so we start to have a good candidate. It takes time. The same thing with equipment suppliers. I think more and more company with like-minded thinking start to emerge and help us. So this just even though there's a short term challenges and you see some company and not delivering what they promise, but just be patient and like a, like a baby, you know, you, It need a certain incubation time and the technology take time to mature, and the industry is the same. That's the only thing I would would say here.

Tom Raftery: 31:51

No, that's a good point. Good point. Cool. Yeah. Great. Lie, if people would like to know more about yourself or any of the things we discussed in the podcast today, where would you have me direct them?

Lie Shi: 32:03

Go to am battery.com I think a lot of information can be found on the website.

Tom Raftery: 32:10

Great. Lie, that's been fascinating. Thanks a million for coming in the podcast today.

Lie Shi: 32:15

Thank you, Tom. Nice talking to you.

Tom Raftery: 32:17

Okay, we've come to the end of the show. Thanks everyone for listening. If you'd like to know more about the Climate Confident podcast, feel free to drop me an email to tomraftery at outlook. com or message me on LinkedIn or Twitter. If you like the show, please don't forget to click follow on it in your podcast application of choice to get new episodes as soon as they're published. Also, please don't forget to rate and review the podcast. It really does help new people to find the show. Thanks. Catch you all next time.