Impact of Battery Material Supply Chains on the Sustainable Development Goals Global Versus Domestic Sourcing for Swedish Electric Cars Master’s thesis in Supply Chain Management LOWE ASPEQVIST EDVIN GUNNARSSON Department of Space, Earth and Environment CHALMERS UNIVERSITY OF TECHNOLOGY Master’s thesis SEEX30 Gothenburg, Sweden 2023 Master’s thesis SEEX30 Impact of Battery Material Supply Chains on the Sustainable Development Goals Global Versus Domestic Sourcing for Swedish Electric Cars LOWE ASPEQVIST EDVIN GUNNARSSON Department of Space, Earth and Environment Division of Physical Resource Theory Chalmers University of Technology Gothenburg, Sweden 2023 Impact of Battery Material Supply Chains on the Sustainable Development Goals Global versus domestic sourcing for Swedish electric cars LOWE ASPEQVIST EDVIN GUNNARSSON © LOWE ASPEQVIST, EDVIN GUNNARSSON, 2023. Supervisor: Researcher Johannes Morfeldt,Division of Physical Resource Theory Co-supervisor: Anders Ahlbäck, Gothenburg Centre for Sustainable Development (GMV) Examiner: Associate Professor Daniel Johansson, Division of Physical Resource Theory Department of Space, Earth and Environment Chalmers University of Technology SE-412 96 Gothenburg Telephone +46 31 772 1000 Gothenburg, Sweden 2023 iv Impact of Battery Material Supply Chains on the Sustainable Development Goals Global versus domestic sourcing for Swedish electric cars LOWE ASPEQVIST EDVIN GUNNARSSON Department of Space, Earth and Environment Chalmers University of Technology Abstract The market for electric vehicles has grown significantly during the last decade. Com- petition is rising over the supply of battery minerals, e.g., lithium and nickel, as the demand for electric vehicles increases. This calls for the investigation of new sus- tainable supply chains for the electric vehicle market. This thesis investigates the impacts on the Agenda 2030 Sustainable Development Goals (SDG) of the current battery supply chain as well as the impacts of a potential alternative sourcing - building a domestic Swedish battery supply chain. This is done by mapping the current battery supply chain and designing a theoretical domestic battery supply chain. The impacts of the two supply chain options are analyzed from a sustain- ability perspective in the context of the SDGs. Figure 0.1: A simplified figure of the main results. The impacts of the current supply chain are negative in terms of land-use, local environmental and ghg-emissions from extraction, refinement and production. All these issues are alleviated in a potential domestic supply chain. Hence, we conclude that domestic sourcing of lithium and nickel for Swedish electric vehicles would be beneficial from an SDG perspective. However, the prospect of an entirely domestic supply chain is uncertain from an economic perspective. The prospect of a domestic supply chain is further hampered by the estimated 10-15 years it takes to start up mining operations. Nevertheless, further extraction of battery minerals is critical to cover the battery demand forecasted up until 2030. Keywords: Sustainable development goals, Agenda 2030, Supply chain management, Supply chain resilience, sustainability, electric vehicles, lithium, nickel, reshoring v Impact of Battery Material Supply Chains on the Sustainable Development Goals Global versus domestic sourcing for Swedish electric cars LOWE ASPEQVIST EDVIN GUNNARSSON Department of Space, Earth and Environment Chalmers University of Technology Sammanfattning Marknaden för elfordon har vuxit kraftigt under det senaste decenniet. Konkur- rensen om tillgången på batterimineraler, ex. litium och nickel, ökar i takt med att efterfrågan på elfordon ökar. Detta motiverar analyser av nya hållbara försör- jningskedjor för elbilsmarknaden. Denna avhandling undersöker effekterna på de globala målen inom Agenda 2030 av den nuvarande batteriförsörjningskedjan samt effekterna av en potentiell alternativ anskaffning av batterimineraler - en inhemsk batteriförsörjningskedja. Detta görs genom att kartlägga den nuvarande batter- iförsörjningskedjan och utforma en teoretisk inhemsk batteriförsörjningskedja. Kon- sekvenserna av de två alternativen för försörjningskedjan analyseras ur ett håll- barhetsperspektiv utifrån de globala målen inom Agenda 2030. Figure 0.2: En förenklad figur av avhandlingens resultat i en grafisk representation. De negative effekterna av den nuvarande leveranskedjan gäller markanvändning, lokal miljö och ghg-utsläpp från utvinning, raffinering och produktion. Alla dessa effekter skulle vara lägre i en inhemsk försörjningskedja. Vi drar därmed slutsat- sen att inhemsk anskaffning av litium och nickel för svenska elfordon skulle vara fördelaktigt ur ett hållbarhetsperspektiv. Utsikterna för en helt inhemsk försörjn- ingskedja är dock osäkra ur ett ekonomiskt perspektiv. Möjligheterna för en inhemsk försörjningskedja påverkas dessutom negativt av att det i genomsnitt tar 10-15 år att starta nya gruvor. Oavsett så är behovet av ytterligare utvinning av batter- imineraler avgörande för att täcka den förväntade efterfrågan på batterier fram till 2030. Nyckelord: globala mål, Agenda 2030, Supply chain management, Supply chain resilience, hållbarhet, elfordon, litium, nickel, reshoring. vii Acknowledgements We want to send our warmest thanks to our supervisors Anders Ahlbäck and Jo- hannes Morfeldt for their expertise and support throughout the whole thesis, to- gether with our examiner Daniel Johansson for managing the project. Furthermore, we want to thank the partner Mistra Carbon Exit for making the thesis possible, together with Gothenburg Center for Sustainable Development for allowing us to use the tool to assess the different SDGs. Lastly, we want to send our warmest thanks to our participating interviewees for sharing their expertise and insights of the battery supply chain and sustainability challenges. Lowe Aspeqvist & Edvin Gunnarsson, Gothenburg, May 2023 ix Contents 1 Introduction 1 1.1 Purpose . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 1.2 Research question . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 1.3 Delimitations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 1.4 Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 1.4.1 Supply chain management theory . . . . . . . . . . . . . . . . 4 1.4.2 Nickel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 1.4.3 Lithium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 2 Method 11 2.1 Interviews . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 2.1.1 Interview guide . . . . . . . . . . . . . . . . . . . . . . . . . . 12 2.2 Sustainable development goals . . . . . . . . . . . . . . . . . . . . . . 13 2.3 Sustainable development goals impact assessment . . . . . . . . . . . 15 2.3.1 Method for impact assessment . . . . . . . . . . . . . . . . . . 15 2.3.2 Confidence of the assessed impacts . . . . . . . . . . . . . . . 17 2.3.3 Attributional vs. consequential impacts . . . . . . . . . . . . . 18 3 Current battery supply chain 19 3.1 Current lithium-ion battery supply chain . . . . . . . . . . . . . . . . 19 3.1.1 Nickel Supply Chain . . . . . . . . . . . . . . . . . . . . . . . 20 3.1.2 Lithium Supply Chain . . . . . . . . . . . . . . . . . . . . . . 21 3.1.3 Battery production . . . . . . . . . . . . . . . . . . . . . . . . 22 3.1.4 Mapped lithium-ion battery supply chain . . . . . . . . . . . . 23 3.2 SDG impact analysis of the current supply chain . . . . . . . . . . . . 25 3.2.1 SDG1 - No poverty . . . . . . . . . . . . . . . . . . . . . . . . 25 3.2.2 SDG2 - Zero hunger . . . . . . . . . . . . . . . . . . . . . . . 26 3.2.3 SDG3 - Good health and well-being . . . . . . . . . . . . . . . 27 3.2.4 SDG4 - Quality education . . . . . . . . . . . . . . . . . . . . 28 3.2.5 SDG5 - Gender equality . . . . . . . . . . . . . . . . . . . . . 29 3.2.6 SDG6 - Clean water and sanitation . . . . . . . . . . . . . . . 30 3.2.7 SDG7 - Affordable and clean energy . . . . . . . . . . . . . . . 31 3.2.8 SDG8 - Decent work and economic growth . . . . . . . . . . . 32 3.2.9 SDG9 - Industry, innovation and infrastructure . . . . . . . . 33 3.2.10 SDG10 - Reduced inequalities . . . . . . . . . . . . . . . . . . 35 3.2.11 SDG11 - Sustainable cities and communities . . . . . . . . . . 35 xi Contents 3.2.12 SDG12 - Responsible consumption and production . . . . . . 36 3.2.13 SDG13 - Climate action . . . . . . . . . . . . . . . . . . . . . 37 3.2.14 SDG14 - Life below water . . . . . . . . . . . . . . . . . . . . 38 3.2.15 SDG15 - Life on land . . . . . . . . . . . . . . . . . . . . . . . 39 3.2.16 SDG16 - Peace, justice and strong institutions . . . . . . . . . 41 3.2.17 SDG17 - Partnership for the goals . . . . . . . . . . . . . . . . 42 3.2.18 SDG impact summary of the current supply chain . . . . . . . 44 4 Domestic battery supply chain 45 4.1 Swedish nickel deposits . . . . . . . . . . . . . . . . . . . . . . . . . . 45 4.2 Swedish lithium deposits . . . . . . . . . . . . . . . . . . . . . . . . . 45 4.3 Suggested domestic supply chain . . . . . . . . . . . . . . . . . . . . 47 4.4 SDG impact analysis of the domestic supply chain . . . . . . . . . . . 50 4.4.1 SDG1 - No poverty . . . . . . . . . . . . . . . . . . . . . . . . 50 4.4.2 SDG2 - Zero hunger . . . . . . . . . . . . . . . . . . . . . . . 50 4.4.3 SDG3 - Good health and well-being . . . . . . . . . . . . . . . 51 4.4.4 SDG4 - Quality education . . . . . . . . . . . . . . . . . . . . 52 4.4.5 SDG5 - Gender equality . . . . . . . . . . . . . . . . . . . . . 53 4.4.6 SDG6 - Clean water and sanitation . . . . . . . . . . . . . . . 54 4.4.7 SDG7 - Affordable and clean energy . . . . . . . . . . . . . . . 55 4.4.8 SDG8 - Decent work and economic growth . . . . . . . . . . . 56 4.4.9 SDG9 - Industry, innovation and infrastructure . . . . . . . . 57 4.4.10 SDG10 - Reduced inequalities . . . . . . . . . . . . . . . . . . 58 4.4.11 SDG11 - Sustainable cities and communities . . . . . . . . . . 59 4.4.12 SDG12 - Responsible consumption and production . . . . . . 60 4.4.13 SDG13 - Climate action . . . . . . . . . . . . . . . . . . . . . 61 4.4.14 SDG14 - Life below water . . . . . . . . . . . . . . . . . . . . 62 4.4.15 SDG15 - Life on land . . . . . . . . . . . . . . . . . . . . . . . 63 4.4.16 SDG16 - Peace, justice and strong institutions . . . . . . . . . 64 4.4.17 SDG17 - Partnership for the goals . . . . . . . . . . . . . . . . 65 4.4.18 SDG impact summary of the domestic supply chain . . . . . . 66 5 Conclusion 69 5.1 Recommendations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70 References 73 A Appendix A I B Appendix B XIII xii List of acronyms BEV Battery Electric Vehicle. EV Electric Vehicle. ghg Greenhouse gases. GII Gender Inequality Index. GMV Gothenburg Center for Sustainable Development. HDI Human Development Index. HEV Hybrid Electric Vehicle. HPAL High Pressure Acid Leaching. ICEV Internal combustion engine vehicle. IPCC The Intergovernmental Panel on Climate Change. JIT Just in Time. LCA Life Cycle Assessment. LCO LiCO2. LFP LiFePO4. Li-Ion Lithium-ion. LMV Light means of transport. MHP Mixed hydroxide precipitate. MPC Maximum Permissible Concentration. Mt Million Metric Tons. NMC LiNiMnCoC2. NZT Net-zero target. OECD The Organisation for Economic Co-operation and Development. PHEV Plug-In Hybrid Vehicle. REE Rare-earth elements. SDG Sustainable Development Goals. UN United Nations. xiii List of acronyms xiv 1 Introduction There is a need for a sustainable supply chain for materials as the electric vehicle (EV) market continues to grow at a rapid pace (Aase, Musso, & Schwedhelm, 2021; Weimer, Braun, & Hemdt, 2019). The underlying value chain of the battery in- dustry is based on the transformation of raw materials into viable products. There are a variety of sustainability issues associated with the extraction of the underly- ing materials and processes since these are based on metals and minerals (Parajuly, Ternald, & Kuehr, 2020). The basis for the supply chain is partially the metals lithium and nickel to name a few (Weimer et al., 2019). As presented by Morfeldt, Davidsson Kurland, and Johansson (2021a), Swedish battery demand is expected to grow, indicating that the associated issues with production will grow as well. The demand for raw materials and production will follow the growth of the EV market. As this is happening, the growth needs to be sustainable and with poten- tial solutions within the supply chain. The focus should not only be ecological but also social and economic sustainability. The Sustainable Development Goals (SDG) presented by the United Nations (UN) can be used to identify the sustainability impact of the 17 goals. There are also 169 targets specified within the 17 goals which allows a deeper sustainability impact analysis. This thesis aims at mapping the supply chain for current battery production and comparing the results to a domestic supply chain locally sourced in Sweden. The conditions for re-designing the supply of raw materials with sourcing in Sweden seem possible based on the techno-economic potential of extracting battery metals and minerals that has been confirmed (Martinsson & Wanhainen, 2022). The project builds on ongoing research in conjunction with Mistra Carbon Exit (www.mistracarbonexit.com) into the demand side of materials for battery manu- facturing and the potential for battery recycling. As sustainability is a large societal issue, there is a need to further research the current supply chain from a sustain- ability perspective with a basis in the SDGs. The replacement of Internal combustion engine vehicle (ICEV) with EVs is viewed as one of the answers to the climate crisis. Since Sweden has committed to implement Agenda 2030 (Miljödepartementet, 2022), the transition to EVs should contribute to achieving the SDGs while based on sustainable supply chains. The electrification of transport requires more research to find sustainably sourced materials to replace the current carbon-driven economy. Minerals used for battery production are one of the largest sustainability issues in terms of electric vehicles and therefore alternative 1 www.mistracarbonexit.com 1. Introduction sourcing methods should be explored(International Energy Agency, 2022e). Within the automotive industry, there are several different types of EVs developed. The most common types include Hybrid Electric Vehicles (HEVs), Battery Electric Vehicles (BEVs) as well as Plug-In Hybrid Vehicles (PHEVs) (Egbue & Long, 2012). Furthermore, there are also a variety of different kinds of batteries. Lithium is a critical raw material in the production of lithium-ion batteries. There have been previous extraction of lithium in Sweden, however there is no current extraction (Martinsson & Wanhainen, 2022). Several of the existing lithium deposits in Swe- den are expected to be possible to use for extraction (SGU, 2023). Lithium is one of the materials on the critical materials list presented by the European Union in 2020 and is, therefore, of extra high interest for the supply chain of battery production (European Commission, 2022). The dominant choice for automotive manufacturers is currently lithium-ion batteries (Li-Ion) and is therefore used as the basis for this thesis (Lipman & Maier, 2021) Different kinds of battery chemistries are used in Li-Ion batteries. The specific names refer to specific chemical combinations, such as LiCO2 (LCO), LiNi- MnCoC2 (NMC), and LiFePO4 (LFP), where NMC- and LFP-types are most widely used within the automotive industry as of now (Lipman & Maier, 2021). Further- more, these chemical definitions are based on the cathode side. For anodes, graphite is the most widely used material (Lipman & Maier, 2021). Cobalt is a widely used material for some of these chemistries (International Energy Agency, 2022e). How- ever, the proportion of cobalt is decreasing in favor of an increasing share of nickel (International Energy Agency, 2022e). There are several reasons for this change. Partially it is related to price shifts as the cobalt price has risen significantly in the last two years. Furthermore, there are instability issues in the cobalt supply chain due to 70% of cobalt being mined in the Democratic Republic of the Congo (Inter- national Energy Agency, 2022e). The many variants of battery chemistries make the entire supply chain of a Li-Ion battery rather complex. Hence, this thesis con- tributes with an analysis of the supply chains of nickel and lithium for EV batteries specifically. Calls have been made in recent literature to implement recycling within the supply chain and its importance for the assurance of enough supply of lithium (Egbue & Long, 2012; Kallitsis, Korre, & Kelsall, 2022; Maisel, Neef, Marscheider-Weidemann, & Nissen, 2023; Nurdiawati & Agrawal, 2022; Tadaros, Migdalas, Samuelsson, & Segerstedt, 2022; Talens Peiró, Villalba Méndez, & Ayres, 2013). Although recy- cling will be an integrated part of the supply chain, the demand-growth in the EV-market is too large to be accommodated by recycled raw materials and is ex- pected to only provide a small contribution to supply according to a report by the Swedish government organization Naturvårdsverket (2023). Recycling is also dis- cussed by Olivetti, Ceder, Gaustad, and Fu (2017) where they argue that recycling within the supply chain is not likely to provide any solution to supply in the short- term time horizon. Furthermore, Naturvårdsverket (2023) conclude that new mines will be required to open in order for the supply of battery-related materials to meet 2 1. Introduction the growing demand. 1.1 Purpose This master thesis aims at comparing different sourcing methods from a supply chain perspective required to produce batteries used for EVs sold in Sweden. A method is required in order to structure the comparison. The method will be applied in a case study to compare the impact on the SDGs from the shift towards domestic sourcing of lithium and nickel instead of imports. Through this, the thesis aims at combining the theory of supply chain management with the sustainable development goals presented by the UN. This research could be highly relevant for the growing industry of battery production and for policymakers. 1.2 Research question RQ.1 - What benefits and drawbacks does the current supply chain have related to the United Nations Sustainable Development Goals? RQ.2 - What implications would a re-designed supply chain for battery production with locally sourced materials in Sweden have on the United Nations Sustainable Development Goals? 1.3 Delimitations As there are several different EVs, battery types and chemistries together with differ- ent approaches to perform a SDG analysis of the supply chains, some delimitations are required to be set in place. • The thesis considers Battery Electric Vehicle (BEV), but neither Hybrid Elec- tric Vehicle (HEV), nor Plug-In Hybrid Vehicle (PHEV). • The thesis only considers Lithium-ion (Li-Ion) batteries, and only lithium as well as nickel in terms of raw materials. • The thesis is limited to only considering the material demands for the electri- fication of the Swedish passenger car fleet. • The thesis does not analyze recycling as an alternative sourcing-method, but rather focuses on virgin raw-materials sourcing. • The SDG analysis will be cradle-to-gate, i.e., only considering the SDG impli- cations to the moment the EV leaves the factory. With this method, the user and end-of-life phases will therefore not impact the SDG analysis • The SDG-analysis only considers the largest producing countries of each raw material • The SDG-analysis considers the future electrification of the Swedish passenger car-fleet, i.e., the effects on the SDG that a switch to domestic sourcing would incur in this specific perspective. 3 1. Introduction 1.4 Background As the supply chain for the batteries for EVs contains a wide variety of specific materials, this chapter gives a background to the different types of materials that are used. Furthermore, a theoretical background for supply chain management is provided to combine the interdisciplinary fields applied in the thesis. 1.4.1 Supply chain management theory The design of the supply chain is an important part of creating sustainable networks. It can be designed to reduce ghg-emissions in the supply chain. Furthermore, sup- ply chains can be designed with economic and social sustainability in mind as well. In the context of economic sustainability, matching the supply and demand of a network is essential (Simchi-Levi, Kaminsky, & Simchi-Levi, 2003). Supply chain management is often divided into strategic, tactical and operational levels (Simchi- Levi et al., 2003). The strategic level is high-level decisions dealing with long-term effects and decisions, whereas the tactical level includes medium-term decisions and the operational level includes daily activities (Simchi-Levi et al., 2003). Following this definition, the design of supply chains is composed of strategic decisions. The field of supply chain management handles all these different facets and is in large part about the designing of supply chains to work as effectively as possible or to reach a certain goal. Sourcing needs to be decided based on a strategy as the supply chain is designed. van Weele (2018) explains that several decisions need to be made in regard to sourcing. Decisions need to be made regarding single or multiple sourcing, global or local/- domestic sourcing, and sourcing must be decided if it should be on a partnership or on a competitive basis. Sourcing is a key element of supply chain management and a further extension of sourcing is purchasing which decides a large part of op- erational decisions based on the chosen strategy (van Weele, 2018). Global sourcing might incur supply chain resilience risks. There are economic risks to a global sourc- ing strategy as global markets experience exchange rates (Simchi-Levi et al., 2003). Furthermore, geopolitical risks should be considered, especially in the wake of the Russian invasion of Ukraine in 2022, Covid-19, and the Evergreen blocking the Suez Canal in 2021 (The Visual Journalism Team BBC News, 2022; Theo Leggett, 2021). The idea of reshoring1 has been a widely discussed subject within supply chain management, especially as a result of the Covid-19 pandemic (Barbieri et al., 2020). Reshoring is a known concept widely discussed in the US since 2005 as an emerging concept after a large part of US manufacturing was moved to China (Tate, 2014). The trend of local sourcing is also growing with the growth of reshoring, not only for geopolitical reasons but as a strategy that is more sustainable and provides flexibil- ity for customers (Tate, 2014). Flexibility is a desirable strategy for companies since 1Reshoring is a concept defined as moving back a section of a business or an entire business from a foreign country to its’ original country, i.e. this is a location-based decision (Cambridge University Press, n.d.; Gray, Skowronski, Esenduran, & Johnny Rungtusanatham, 2013) 4 1. Introduction this provides the opportunity to handle a variety of different scenarios (Simchi-Levi et al., 2003). Ashby (2016) argues that there is a need for a shift from offshoring based on reducing costs and increasing profits towards a more long-term view with sustainability in mind in terms of sourcing decisions. The consequences of supply chain disruptions have strong negative implications as the economy is more globalized and reliant on optimized Just in Time (JIT) supply chains. The recent rise of reshoring represents one action possible out of several to create supply chain resilience. Supply chain resilience is defined by Ponomarov and Holcomb (2009) as: ”The adaptive capability of the supply chain to prepare for unexpected events, respond to disruptions, and recover from them by maintaining continuity of opera- tions at the desired level of connectedness and control over structure and function.” - Ponomarov and Holcomb (2009) Previous resilience strategies have involved a number of different methods to create resilience within the supply chain. Gatenholm and Halldorsson (2022) compiles the strategies applied in supply chain management as sharing information between ac- tors, redundant suppliers, flexible suppliers, inventory buffers, backup sourcing, and finally the sharing of risk between actors and the usage of multiple-sourcing. This is supported by Tukamuhabwa, Stevenson, Busby, and Zorzini (2015) which compiled 91 articles and suggested that previous research within supply chain resilience has focused on redundancy, agility, collaborations, and flexibility. Ponomarov and Hol- comb (2009) argues that better supply chain resilience leads to better sustainable competitive advantages. Freight transport systems is used to move goods throughout the world and is a key element of supply chain management. The freight transport systems make up the links that connect nodes within a supply chain network. The different modes include road transportation, air transportation, maritime transportation, rail trans- portation, intermodal, telecommunications, and pipelines (Rodrigue, 2020). Only air, road, rail and maritime transportation will be considered for the scope of this thesis. Intermodal is not considered as it is a combination of freight transport systems. Intermodal as well as telecommunications is not relevant to mineral trans- portation. All the different modes have different benefits and drawbacks shown below in table 1.1. 5 1. Introduction Table 1.1: Different freight transport modes and their respective benefits and drawbacks (Rodrigue, 2020) Freight transport mode Benefits Drawbacks Road Cheap High flexibility/accessibility Low capacity High ghg-emissions Rail Low CO2-emissions High capacity Low flexibility/accessibility Relatively slow Air Flexible Fast Limited capacity Expensive High CO2-emissions Sea Cheap Low CO2-emissions High capacity Slow Low supply chain resilience 1.4.2 Nickel Nickel is a critical mineral used worldwide in a variety of industries. Mudd and Jowitt (2014) estimated that the total amount of nickel reserves in the world is 296 Million Metric Tons (Mt), however, estimates can drastically change depending on how the assumptions are made. Geological Survey (2022) estimated that the total amount of nickel in the world is at least 300Mt, with the possibility that extensive amounts of nickel could be found on the ocean floor, which would extend these es- timates. The global mine production of nickel in 2020 was approximately 2.5 Mt (Inter- national Nickel Study Group, 2021). Indonesia is the largest producer of nickel, producing almost 0.8 Mt of nickel ores (International Nickel Study Group, 2021). The second largest producers are the Philippines and Russia, producing respec- tively 0.3Mt and 0.25Mt of all nickel in 2020, respectively. Overall, the global share of nickel produced in Asia has increased from 34% in 2016, to 51% in 2020. Nickel extracted in Europe has seen a decrease, from 14% in 2016, to 12% in 2020 (Inter- national Nickel Study Group, 2021). There are two main deposits of interest - laterite and sulphide deposits for nickel. The worldwide division is around 40% sulphide deposits and 60% laterite deposits (International Nickel Study Group, 2021). Other sources estimate that the divi- sion is 30% sulphide deposits and 70% laterite deposits (Elias, 2002; König, 2021). When extracted, the nickel will have different element purity depending on the de- posit (International Energy Agency, 2022e). If the nickel has an element purity of below 99.8%, it is classified as class 2 nickel (also known as low-grade). Class 2 nickel is mostly extracted from laterite deposits. Since this nickel is of lower quality, it is mainly used for stainless steel production. Nickel that has an element purity of above 99.8% is classified as class 1 nickel (also known as high-grade or battery-grade nickel). Class 1 nickel is suitable for battery production, whereas class 2 needs to 6 1. Introduction be processed in order to reach the required element purity for battery production (International Energy Agency, 2022e). Sulphide deposits are estimated to be around 60% of total class 1 nickel extrac- tion, following 40% from laterite deposits (König, 2021). Sulphide deposits are the most used for the class 1 nickel because of the high element purity directly from ex- traction combined with easier processing methods (Elias, 2002). Even though class 1 nickel is optimal for battery production, 70% is used for stainless steel production, whereas battery production is only around 5% of the total supply (International Nickel Study Group, 2021). The usage of class 1 nickel in stainless steel produc- tion can pose a challenge for electrification. However, International Energy Agency (2022e) presents a growing market share for class 1 nickel in the battery industry with an increase from 4% to 7% between 2020 and 2021. Processing solutions for transforming low-grade nickel into high-grade nickel have seen growing interest following the increased demand for battery-grade nickel. High Pressure Acid Leaching (HPAL) is one commonly used processing method which allows class 1 nickel to be produced from laterite deposits (Meshram, Abhilash, & Pandey, 2019). There are challenges with HPAL processing due to extensive use of acid, which leads to high capital costs and three times the amount of emis- sions of ghg compared to sulphide processing (International Energy Agency, 2022e; Meshram et al., 2019). Attempts at commercializing of HPAL processing are be- ing tried in Indonesia where the world’s largest HPAL-plant is planned to produce 0.125Mt nickel annually (Reuters, 2023). The plant is expected to be operating in 2025. There are further new processing technologies for nickel such as Mixed hy- droxide precipitate, which allows laterite materials to be transformed into sulphide materials through an intermediate product (International Energy Agency, 2022e). Nickel matte is another battery-grade mineral that can be produced from laterite materials, however at high ghg emission rates (International Energy Agency, 2022e). Nickel ore extraction is related to health and environmental impacts connected to the challenges of mineral toxicity. According to Parmar and Thakur (2013), nickel is one of the most toxic metals, especially when involved in the food industry. The most common health risk from nickel is dermatitis, where the metal causes irrita- tion on the skin. Parmar and Thakur (2013) explains that high exposure to nickel can cause bone, lung, and nose cancer. An indication of this is shown in the city of Norilsk in Russia, where the nickel producer Norilsk Nickel is positioned. The mortality rate in Norilsk from lung cancer is 1.2-2.5 times larger than the overall rate in Russia (Lavelle M, 2021). One of the most extensive environmental impacts of nickel extraction can also be found in Norilsk. The pollution from the factory has caused dying or already dead forests to the size of 5.9 million acres and the only rival to the pollution rate of sulphur dioxide emissions from Norilsk is erupting volcanoes (Lavelle M, 2021). The price of nickel has seen extensive increases in the last years (International En- 7 1. Introduction ergy Agency, 2022e). From January 2021 to May 2022, the price of nickel almost doubled. According to International Energy Agency (2022e) there are three reasons for this price increase. The first is an insufficient amount of investment in the supply chain, due to the earlier low prices. Second, there are challenges in production con- nected to the pandemic, and third, Russia’s invasion of Ukraine has caused further price increases. Additional developments in the war could pose future critical supply risks for high-grade nickel from Russia (International Energy Agency, 2022e). There has been an increase in demand for high-grade nickel, but not as unequivocal as for lithium. The majority of the high-grade nickel is still used in other applications than EV-batteries (International Energy Agency, 2022e). 1.4.3 Lithium With EVs recent rise to prominence, the demand for lithium has skyrocketed over the last ten years and is expected to rise even further in the upcoming ten years (International Energy Agency, 2023). In a Net-zero target (NZT) with 1.5 degrees Celsius, the lithium required for this demand is 100 times higher than what is pro- duced today (Bridge & Faigen, 2022). With complicated infrastructural processes for extraction, as well as limited geographical deposits, lithium is a key resource for the growth of the EV market (Talens Peiró et al., 2013). The different production sources for lithium include pegmatites2. Lithium can also occur in brines (Talens Peiró et al., 2013). Within all of the different configurations, as lithium is highly reactive, it does not occur in a pure form, which means it needs to be processed further before it is usable within EV-production. Furthermore, as the metal is processed, it must be stored in a way where it cannot react with oxygen (SGU, 2023). To extract the lithium from brine, salt water is evaporated over a pe- riod of 12-18 months through natural evaporation (Talens Peiró et al., 2013). The extraction of lithium from pegmatites includes various chemical processes depending on which mineral the lithium occurs within (Talens Peiró et al., 2013). This process requires a lot more energy as this process often involves heating the mineral to 1100 degrees Celsius (Talens Peiró et al., 2013). The reserves of lithium are estimated to be around 39 Mt, although it should be stated that estimations vary (Talens Peiró et al., 2013). The largest deposits are located in South America, more specifically Bolivia, Argentina, and Chile (Tal- ens Peiró et al., 2013). However, the largest producers of lithium today are Australia with 52%, Chile with 22%, and China with 12% of global production respectively (Bridge & Faigen, 2022). As the extraction of lithium requires large infrastructural investments and geological surveys, there are still many unexploited reserves (In- ternational Energy Agency, 2022e). Investments are ongoing in countries such as Bolivia, however, from the start of a project it usually takes 5-10 years before the raw material is produced and shipped (International Energy Agency, 2022e). Deposits of lithium are regularly discovered as this is a sought-after material within 2A pegmatite is a form of igneous rock (Tikkanen, n.d.) 8 1. Introduction the current rise of EVs. At the start of 2023, India announced that they had discov- ered reserves of an estimated 5.9 Mt of lithium in the area of Jammu and Kashmir (Geological Survey of India (GSI), 2023) which would make India the country with the sixth largest reserves in the world (Hendrix, 2022). The region of Kashmir is highly politically destabilized and tensions have been high since India’s indepen- dence in 1947, which is further testament to geopolitical risks when lithium reserves are discovered in politically destabilized regions (Hendrix, 2022). There are several potential negative effects of mining and using lithium. Lithium is a mineral that is toxic to organisms when entering the body at high concentrations (Bolan et al., 2021). As the usage and extraction of lithium are increasing, the risks of contamination to the local environment as well as risks to public health increase as a consequence (Zeng, Li, & Liu, 2015). This challenge can be exacerbated if not the correct recycling systems and infrastructure is set up to handle lithium waste through all stages of production (Zeng et al., 2015). Lithium has potential toxicity to ecosystems as well as to human health (Bolan et al., 2021). There are several documented negative health effects for humans, which has led to studies on risk management to handle the health risks (Bolan et al., 2021). Studies that examine if communities are willing to risk these potential local effects concluded that wa- ter pollution is one of the most relevant effects on nearby communities of open-pit lithium mines (Crespo-Cebada, Díaz-Caro, Gil, & Sanguino, 2020) The demand for further lithium extraction is expected to grow as the market for EVs continues to grow. In 2011, the battery market for lithium was estimated to use around 0.007 Mt of lithium (Talens Peiró et al., 2013). Within ten years the market grew to 0.3Mt (Lipman & Maier, 2021). The demand for lithium in the battery market is expected to keep growing exponentially, with forecasts expecting the demand in 2028 to be 2.8Mt of lithium. The expected mining capacity com- bined with projects currently in the pipeline only expects to provide around 2Mt of lithium (Lipman & Maier, 2021). The lithium market has experienced a significant price increase as demand has increased and availability decrease in the last couple of years (Bridge & Faigen, 2022). 9 1. Introduction 10 2 Method The methodology for the thesis uses a combination of a variety of segments. The combination of these segments is visualized in fig. 2.1 and is further described in the following sections. The method was developed to combine the interdisciplinary field required to answer RQ.1 and RQ.2. The left side of the figure where the flowchart splits (fig. 2.1 is related to RQ.1 and the right side plus the comparison represents the parts specifically related to RQ.2. Figure 2.1: Flowchart of the different segments in the thesis and how they work together. The Design of Method refers to the method (see section 2). The SDG analysis (section 3.2) was performed based on the mapped Li-Ion battery supply chain (sec- tion 3.1). The interviews (described in section 2.1) serve as underlying empirical data for creating the domestic supply chain (section 4) as well as to perform the SDG-analysis for the domestic supply chain (section 4.4). These steps were then combined and compared to draw conclusions (section 5) regarding the benefits and drawbacks of the supply chains, as formulated in RQ.1 and RQ.2. 11 2. Method 2.1 Interviews To achieve an overall view of Sweden’s position internationally in terms of both raw material sourcing for battery production, as well as potential supply chain strate- gies, interviews with some of the larger actors along the supply chain were carried out. Interviews were performed to gather further empirical data to confirm the data gathered from articles, studies and papers. The interviews were performed in a semi- structured method with similar themes for each respondent (Lind, 2014). However, the questions differ as the respondents work in different fields, roles and organiza- tions. This provided flexibility to ask further questions if some areas are of higher interest depending on the respondent. Four individuals were interviewed to acquire expert opinions to be used as empirical data in order to get a better understanding of the sustainable development goals, minerals, and the battery supply chain. To adhere to research ethics, it is important to consider the respondent’s volun- tariness, privacy, confidentiality and anonymity as argued by Lind (2014). There- fore, all respondents are kept anonymous. Furthermore, keeping all respondents anonymous was used to get full honesty in the answers, as many of the respondents are working for organizations that might have reservations about giving out certain information. These organizations might particularly have restrictions to give out information about suppliers, supply chains, partners and the integration of SDGs. Before the start of the interview, all respondents were asked to confirm their consent to participate in the interview. We aimed to accomplish this to keep the academic integrity of the thesis whilst still protecting the rights and integrity of the respon- dents. Since the respondents are anonymous, a system is devised with referrals to each respondent with a letter (A-D), as seen in table 2.1. Table 2.1: Respondents A to D with date and time for each interview. Respondent Date Time Role A 23/3-2023 ∼60 minutes Public authority B 30/3-2023 ∼60 minutes Public authority C 31/3-2023 ∼50 minutes Practitioner D 4/4-2023 ∼60 minutes Practitioner All interviews were performed digitally as our respondents are spread out over a large geographical area. Both authors were present for each interview, one taking notes and one asking the questions. However, both authors were ready to ask questions if anything came up that could add to the empirical data. 2.1.1 Interview guide An interview guide was created to support the interviews as suggested by Lind (2014). The interviews can be kept similar in structure even if the respondents are in different fields and organizations with the use of themes in the interview guide. In further regard, the respondents might interpret questions differently depending 12 2. Method on the context and therefore it is highly relevant to have similar themes to keep the data structured. The chosen themes are as follows: • Sustainability • Sustainable development goals • Supply chain management in regard to batteries • Current sourcing • Swedish sourcing The questions are not included in the thesis to keep all participants anonymous. As some of the questions contain names of the organization where the respondents are active, or other organizations which they are partners with, the questions are left outside the thesis. 2.2 Sustainable development goals The framework for the evaluation of the supply chains is set by the 17 Sustain- able Development Goals (SDG) presented in the United Nations (UN) for the 2030 Agenda for Sustainable Development, adopted by all UN member states in 2015 (UN, n.d.). The SDGs incorporate a holistic view of sustainability and are con- nected economically, socially as well as environmentally (UN, n.d.). In conjunction with the 17 goals, there are 169 corresponding targets (UN, n.d.). The goals are defined as the following by UN (n.d.). All definitions are quotes from UN (n.d.): • Goal 1, No poverty – End poverty in all its forms everywhere • Goal 2, Zero hunger – End hunger, achieve food security and improved nutrition and promote sustainable agriculture. • Goal 3, Good health and well-being – Ensure healthy lives and promote well-being. • Goal 4, Quality Education – Ensure inclusive and equitable quality education. • Goal 5, Gender equality – Achieve gender equality • Goal 6, Clean water and sanitation – Ensure availability and sustainable management of water. • Goal 7, Affordable and clean energy – Ensure access to affordable, reliable, sustainable and modern energy for all. • Goal 8, Decent work and economic growth – Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all. • Goal 9, Industry, innovation and infrastructure – Build resilient infrastructure, promote inclusive and sustainable industri- alization and foster innovation. • Goal 10, Reduced inequalities – Reduce inequality within and among countries. 13 2. Method • Goal 11, Sustainable cities and communities – Make cities and human settlements inclusive, safe, resilient and sustain- able. • Goal 12, Responsible consumption and production – Ensure sustainable consumption and production patterns. • Goal 13, Climate action – Take urgent action to combat climate change and its impacts. • Goal 14, Life below water – Conserve and sustainably use the oceans, seas and marine resources for sustainable development. • Goal 15, Life on land – Protect, restore and promote sustainable use of terrestrial ecosystems, sustainably manage forests, combat desertification and halt and reverse land degradation and halt biodiversity loss. • Goal 16, Peace, Justice and strong institutions – Promote peaceful and inclusive societies for sustainable development, pro- vide access to justice for all and build effective, accountable and inclusive institutions at all levels. • Goal 17, Partnership for the goals – Strengthen the means of implementation and revitalize the global part- nership for sustainable development. A number of indicators are used to measure the progress of implementing the SDGs (Hák, Janoušková, & Moldan, 2016). A first set of indicators were introduced in 2015 with 330 in total (Hák et al., 2016). The number of indicators has since then been refined to 231 and divided into three different tiers (United Nations Department of Economic and Social Affairs, 2022). The purpose of the tiers is not to rank the dif- ferent indicators, but rather help organizations to create implementation strategies for the 17 goals (United Nations Department of Economic and Social Affairs, 2022). The three tiers are defined as followed: • Tier 1 - ”Indicator is conceptually clear, has an internationally established methodology and standards are available, and data are regularly produced by countries for at least 50 per cent of countries and of the population in every region where the indicator is relevant.” (United Nations Department of Economic and Social Affairs, 2022) • Tier 2 - ”Indicator is conceptually clear, has an internationally established methodology and standards are available, but data are not regularly produced by countries.” (United Nations Department of Economic and Social Affairs, 2022) • Tier 3 - ”Indicator is conceptually clear, has an internationally established methodology and standards are available, but data are not regularly produced by countries.” (United Nations Department of Economic and Social Affairs, 2022) Hák et al. (2016) argue that some of the indicators might be difficult to use and that they should be slimmed down. This has been done in later versions of the UN documents to make the SDGs easier to implement (United Nations Department 14 2. Method of Economic and Social Affairs, 2022). It should be noted that the targets have been developed over time and indicators have been changed. Older literature on the subject has limited use since conclusions made in these include issues which since then have been adjusted. J. D. Sachs et al. (2019) argue that stakeholders have difficulties to operationalize the 17 goals and suggest what they refer to as six building blocks. This argument is further strengthened by Swain (2017) which argues that the SDGs has been difficult to quantify and implement. The suggested method by J. D. Sachs et al. (2019) re-configures the 17 goals into collected building blocks which include: 1. Education, gender, inequality 2. Health, well-being, demography 3. Energy decarbonization, sustainable industry 4. Sustainable food, land, water, and oceans 5. Sustainable cities and communities 6. Digital revolution for sustainable development J. D. Sachs et al. (2019) argue that these building blocks will make it easier to operationalize within institutions. The idea of linking the goals to one another has been done by other authors as well. (Le Blanc, 2015) uses network theory to link goals and shows that the 17 goals can be categorized into different thematic areas. Le Blanc (2015) argues for strong collaboration and ”break the silos” between differ- ent organizations and institutions to reach the goals. With each country expected to create its own strategic plans, this can take different forms. Swain (2017) argues that developing countries should focus on economic and social sustainability whilst developed countries should instead focus more on social and environmental goals. 2.3 Sustainable development goals impact assess- ment An analysis of the SDG-impacts of the current and a proposed domestic battery supply chain was performed (See section 3.2 and 4.4). The SDG impact analy- sis was performed from the perspective of comparing global and domestic sourcing with the help of the SDG impact assessment tool provided by GMV (https:// sdgimpactassessmenttool.org/en-gb (?)), further described in section 2.3.1. This tool is called the SDG Impact Assessment Tool (?). 2.3.1 Method for impact assessment The SDG impact assessment addressed the impacts of the sourcing strategies through the lens of SDGs. This was accomplished by analyzing the impacts on the most rel- evant targets within the SDGs. The method in which the tool was used, was based on the instructions provided by GMV, which consists of five steps (Gothenburg Center for Sustainable Develop- ment (GMV), n.d.). Since the SDG impact tool has a broad approach, a decision 15 https://sdgimpactassessmenttool.org/en-gb https://sdgimpactassessmenttool.org/en-gb 2. Method was made to specify the instructions for this thesis. These five steps are set as follows: 1. Gather a team 2. Define, refine, draw the line, set a scope for the task 3. Sort the SDGs into relevant, not relevant and don’t know 4. Assess your impact by choosing between a positive impact, indirect positive impact, no impact, indirect negative impact, negative impact, or more knowl- edge required. 5. Chose a strategy for the future In order to translate the assessment tool into an academic methodology into the thesis, some changes to these instructions were made. First of all, gathering your forces is instead interpreted as mapping the supply chain (see section 3.1) and gath- ering knowledge. ”Define, refine and draw the line” can be seen as the mapping of the supply chain. The tool then is used to assess steps 3 and 4 and to structure the discussion. Choosing the strategy forward can be seen as drawing conclusions based on the analysis. The steps suggested by GMV are therefore transformed into the following steps for the purpose of this thesis: 1. Gather information 2. Map the supply chain 3. Sort the SDGs 4. Assess the impact 5. Draw conclusions The method to map the supply chain was to gather knowledge through the various journal articles, paper and studies to combine this knowledge together into a fully mapped supply chain. As supply chains are complex networks (Simchi-Levi et al., 2003), The mapped supply chain was kept at a schematic level as supply chains are complex networks (Simchi-Levi et al., 2003). Furthermore, it is also as the purpose of mapping the supply chain is to determine the SDG impacts, and detailed infor- mation is not always available. Sorting of the SDGs was performed to simplify the process of analyzing the im- pacts. Each SDG was deemed relevant or not relevant which thereafter structures the order of when each SDG will be analyzed. The SDG impact assessment tool suggests this step to easier perform the analysis and argues it has no impact on the final result (Gothenburg Center for Sustainable Development (GMV), n.d.). The assessed impact was based on the UN definition of each SDG. Specific tar- gets were used to assess the impact of specific characteristics. After this stage, the SDGs with connected targets were assessed based on the previous information from the mapped supply chains (See section 3.2 and 4.4) but also combined with new sources if required. A resulting impact assessment indicates whether the supply chain has a direct negative impact, indirect negative impact, no impact, indirect positive impact or direct positive impact on the specific goal. The definitions for the various impact categories are shown below in table 2.2. The interpreted defi- nitions are based on the definition provided by Gothenburg Center for Sustainable Development (GMV) (n.d.). 16 2. Method Table 2.2: Definitions of SDG impacts SDG Impacts Definition Direct positive impact Clearly connected and visible positive impact Indirect positive impact Positive impacts from secondary sources or only minor positive effects No impact Negligible or no impact Indirect negative impact Negative impacts from secondary sources or only minor negative effects Direct negative impact Clearly connected and visible negative impact 2.3.2 Confidence of the assessed impacts The treatment of confidence in information used as input to the assessment is im- portant for the result and its authenticity. The confidence in the results is of high interest as the SDGs span many different topics. There could be knowledge gaps or missing information in certain areas which reduces the confidence level in the impact analysis. For this reason, a priority list for how to make the assessment and its’ confidence was devised. The list is as follows, with number 1 representing the highest confidence and number 4 representing the lowest confidence. 1. Specific journal articles, studies or papers etc. 2. General journal articles, studies or papers, or expert opinions. 3. General indicators such as transparency index, Human Development Index (HDI), etc. 4. Qualitative discussion when none of the above options are available for making an assessment of the impact. ”Specific” refers to articles, studies or papers performed on the specific subject. For example, SDG5, Gender Equality uses an article by Abrahamsson et al. (2014) which examine gender equality in mining for Sweden. This is therefore a specific article to SDG5. ”General” instead refers to a study, article or paper on a more general level. This can for example be as Loayza and Rigolini (2016) found that mining districts generally have lower poverty. However this study was not performed in a area of this thesis. Therefore this is a more general study on the subject and treated as ”general”. The list was devised in order to handle the breadth of the issues discussed as they span many interdisciplinary fields both in terms of the SDGs, and in terms of supply chain management, geology, economics, etc. The method of using a confidence scale was inspired by how the The Intergovernmental Panel on Climate Change (IPCC) uses similar tools (Ridge et al., 2010). Our confidence scale can be seen as a representation of the X-axis in fig. 2.2 where Ridge et al. (2010) defines the confidence of different types of evidence (in this case, the aforementioned priority list). The Y-axis defined by Ridge et al. (2010) connecting to the agreement within 17 2. Method the scientific community on the issue will not be considered in this thesis. The list of varying degrees is refered to as empirical bases. Figure 2.2: The IPCC-method of confidence. From Ridge et al. (2010) In our confidence scale, each source was given points for its’ confidence characteristics as defined above, where specific journal articles were 1 point, general journal articles were 2, etc. These points, or the usage of these types of sources are visualized and reported in the final results. 2.3.3 Attributional vs. consequential impacts Within the field of Life Cycle Assessment (LCA), there are different kinds of LCAs which include consequential LCA as well as attributional LCA (Ekvall, 2020). The consequential LCA focuses on how environmental impacts will change in response to specific decisions (Ekvall, 2020). The attributional LCA instead focuses on the environmental attributes of a life cycle (Ekvall, 2020). Inspired by this methodol- ogy, the SDG impact analysis was decided to be assessed either consequentially or attributionally. With this distinction, the impact analysis performed was done with attributes in mind. As this thesis aims at looking at a shift from global to domestic sourcing of raw materials, this in itself has consequential implications, however, the analysis instead looks at the attributes of the supply chains to assess the impact of the shift. The reason for choosing an attributional approach is due to the assumption that no reductions of production will be made to the current production. This in turn is assumed as the demands of battery minerals is expected to rise significantly. Furthermore, this removes a layer of complexity to the analysis and attributes from the various countries can be compared. 18 3 Current battery supply chain This section presents a schematically mapped supply chain and the distribution flows of the current battery supply chain. A SDG impact analysis was performed in section 3.2 based on the mapped current battery supply chain. The results from the SDG impact analysis are presented in section 3.2.18 and are used to answer RQ1. 3.1 Current lithium-ion battery supply chain The major steps of the Lithium-ion (Li-Ion) supply chain for EVs involves six steps in the form of mining, raw material processing, cell production, battery cell produc- tion, EV-production, and recycling or re-use (International Energy Agency, 2022e). What makes the supply chain complicated is that each of these different steps is con- trolled by different actors and that reserves are geographically spread out. China is in many cases the largest producer of refined minerals but not the largest pro- ducer of raw materials (Bridge & Faigen, 2022). A similar pattern is seen for both lithium and nickel throughout the Li-Ion-supply chain. This highlights that refining capabilities are of high importance to create a domestic supply chain. A simplified, schematic view of the Li-Ion-supply chain can be seen in 3.1. In this example (fig. 3.1), sections of the supply chain that are related to both the use and end-of-life phases of batteries’ life cycle, including disposal or recycling, are excluded since they are considered outside of the scope of the thesis. The schematic supply chain in fig. 3.1 is a highly simplified version of an actual supply chain, which is a complex dynamic network with changes occurring over time (Simchi-Levi et al., 2003). All different parts of the vehicle have their own set of supply chains, and the same is true for the material production and manufacturing of components. Resources are applied at various nodes within these networks to accomplish specific tasks (Gadde, Håkansson, Jahre, & Persson, 2022), for example, producing a battery cell. Lithium is used for anodes as well as cathodes within the supply chain (see fig. 3.1). The steps in the supply chain are broken down into the production of resources, the production of material (material refining), compo- nent manufacturing, and the production of technology which includes the battery cells and the EVs (International Energy Agency, 2023). The average EV requires around 29 kilograms of nickel and around 6 kilograms of lithium per EV (SGU, 2023). Around 185 kgs of minerals are required in total, where lithium represents 3.2% and nickel 15.7% (SGU, 2023). 19 3. Current battery supply chain Figure 3.1: The supply chain of EVs (International Energy Agency, 2023) 3.1.1 Nickel Supply Chain Russia is the largest extractor of class 1 nickel, producing 20% of the world’s de- mand. 67% of class 1 nickel produced is used to supply Europe, with the rest used to supply China (International Energy Agency, 2022e). Russia is one of the major suppliers in the EV-battery industry. Both Australia and Canada produce nickel from sulphide ores and are the two largest suppliers following Russia (International Energy Agency, 2022e). Nickel production per country can also be measured and reported as primary nickel. Primary nickel has undergone basic processing and is not necessarily extracted from a mine, but could be acquired from recycling or refining imported ore. Therefore, when analyzing worldwide primary nickel production, the largest actors differ com- pared to the ordinary mine production. China is in this context the largest supplier producing 0.75Mt of primary nickel followed by Indonesia at 0.623Mt in 2020 (In- ternational Nickel Study Group, 2021). Important to acknowledge is that primary nickel still can be low-grade in need of further processing to be suitable for battery production. Addressing the market shares of battery-grade nickel refining per year is of im- portance since both laterite and sulphide deposits can be used to produce class 1 nickel. According to Bridge and Faigen (2022) 48.9% of the battery grade nickel is refined in China, followed by Finland at 17.3%, Indonesia at 11.3%, Japan at 9.1%, and last Australia at 5.8%. China is the largest importer of class 1 nickel around 130 000 tonnes according to International Nickel Study Group (2021). International Energy Agency (2022e) presents that China dominates the downstream EV battery supply chain. China was also the largest nickel mineral processing country in 2020 (International Energy Agency, 2022e). 20 3. Current battery supply chain Finland is the largest nickel producer in Europe with four refineries and smelters, with further projects in collaboration with companies such as Norilsk Nickel (Rus- sia) and BASF (Germany) in progress (Dehaine Quentin, P. Michaux Simon, Pokki Jussi, Kivinen Mari, & Butcher Alan R., 2020). According to European Commis- sion (2022), Finland could supply 16% of the total European demand for nickel. Dehaine Quentin et al. (2020) estimates that Finland could be supplying a large EV production plant with cathode materials for 500 000 EVs per year. 3.1.2 Lithium Supply Chain Lithium supply is highly reliant on production infrastructure and not only the avail- ability of reserves (Egbue & Long, 2012). This has led to countries such as China taking a major part of the downstream supply chain after the extraction of lithium. Australia provides 52% of the mineral production of lithium but only refines 8.8% (Bridge & Faigen, 2022). The largest contributor in the form of refining is China with 60.4% of all refined lithium (Bridge & Faigen, 2022). Egbue and Long (2012) describes the supply chain of lithium in a similar fashion to International Energy Agency (2023), however, adds the stage of recycling. This creates an additional stage in the supply chain, where lithium from EVs are sent upstream to the stage of mineral processing to be re-used again. The trade flows of lithium oxide, lithium hydroxide, and lithium carbonates are visualized in fig. 3.2 where red represents export and green imports. The figure clearly shows how large flows are exported from South America to China for refining of minerals (Olivetti et al., 2017). These trade-flows do not include concentrates of lithium, therefore, Australia is not as large as could be expected by total production (Olivetti et al., 2017). Figure 3.2: The trade flows of lithium oxide, hydroxide and lithium carbonates (Olivetti et al., 2017). The red color represents export and the green color imports One of the major risks to supply chain resilience is geopolitical risks. Over 90% of reserves are located within only five countries (Egbue & Long, 2012), geopolitical reasons could lead to quick shifts in the availability of supply, which in turn could 21 3. Current battery supply chain affect the EV-market, similar to what happened with semi-conductors during the covid-pandemic (Frieske & Stieler, 2022). The high geographical concentration of lithium is further problematic as the countries with high amounts of reserves can handle this commodity similar to oil to control prices. This could make the entry barriers within the market much higher, which could hinder the further expansion of raw materials mining and refining (Egbue & Long, 2012). A further problem within the lithium supply chain includes the extraction methods (as explained in 1.4.3). As the process of extracting lithium from brine is 12-18 months, possible supply disruptions might lead to increasing prices of lithium due to higher lead times as there is no elasticity within the process (Egbue & Long, 2012). The market conditions and usage areas of lithium are changing with the recent and ongoing growth of the EV-market. The end-use of lithium has changed significantly in the last ten years. 23% of all mined lithium end-use was within battery-production in 2011 (Egbue & Long, 2012). Comparatively, 80% of all end-use for lithium was for batteries in 2022 (Garside, 2023). This number is expected to reach 95% by 2030 (Bridge & Faigen, 2022). 3.1.3 Battery production The battery supply chain can be divided into two separate channels with anode and cathode as seen in fig. 3.1. This is of relevance since lithium is a part of the supply chain of the anode as well as for the cathode (International Energy Agency, 2022e). Based on this division, the following shares of production were true for 2020: Table 3.1: Cathode and anode production percentages based on country. Data from Bridge and Faigen (2022) Country Cathode Anode China 30-42% 58-65% Japan 30-33% 19-25% South Korea 7-15% 6-7% United States ∼0% 10% Rest of production 3-10% 3% Total production: ∼3 million tonnes ∼1.2 million tonnes China is the largest producer of both cathode and anode (see table 3.1) and has a majority of the market share in anode production. China’s dominant position in the EV-battery production can be seen in fig. 3.3 with 79% of production in 2022 (O’Dea, 2023). The second largest producer is the United States with 6.2% of production, followed by Hungary with 4% of production (O’Dea, 2023) as visualized in fig. 3.3. The rest of the production is spread out over a number of countries across the world. 22 3. Current battery supply chain Figure 3.3: Shares of production of Li-Ion-batteries for EVs in 2022. Data from O’Dea (2023) Forecasts for 2025 indicate that China’s dominant position will remain, however, with other countries expanding EV-battery production, China’s share of production is expected to decrease to 65%. Germany is expected to overtake the US and have around 11.3% of production (O’Dea, 2023). Although China is a small actor in terms of raw materials production, they are positioned to control the refinement of materials, production of battery cells and production of batteries in the supply chain. 3.1.4 Mapped lithium-ion battery supply chain With all the information gathered (See section 1.4 and 3.1), a completed schematic of the current Li-Ion-battery supply chain can be seen in fig. 3.4. As discussed in section 1.4.1, supply chains are highly complex networks rather than simple chains. Due to this, the supply chain presented in fig. 3.4 is only a sketch of the parts relevant to this thesis. The sketch represents the parts of the supply chain that have been analyzed in-depth and are further assessed in the SDG-analysis. The supply chain is divided into different parts as visualized in fig. 3.4. Lithium has two sources that both need to be processed to be turned into pure lithium. The same is true for the case of nickel with similar steps in the process. The flows of the current battery supply chain are mapped based on Section 3.1 and visualized in figure 3.5. Lithium is shown in a teal color and the nickel material flows are visualized in red. Through this visualization, it becomes clear how the material flows are separated and drawn from different parts of the world. A clear node in Asia, and more specifically China, can be seen in the flows. China has built downstream capabilities in the supply chain after the extraction of raw material which was discussed in chapter 3.1.3. This is clearly seen in the production and refinement of lithium. 23 3. Current battery supply chain Figure 3.4: Schematically mapped supply chain. The pure materials of lithium and nickel sulfate are used for the production of cathodes and anodes after extraction and refining. Thereafter, the cathodes and anodes are used in the production of the battery cells, used for the production of EV-batteries and electric vehicles. Figure 3.5: Largest actors and flows in mining and refining. Lithium is shown in a teal color and the nickel material flows are visualized in red. 24 3. Current battery supply chain 3.2 SDG impact analysis of the current supply chain This section describes the results of the SDG-analysis. Only the largest countries within the supply chain have been considered to lower the complexity of the analysis and to provide a holistic view of the sustainable development goals of the supply chain (see chapter 2). 3.2.1 SDG1 - No poverty We argue that the final impact assessment of SDG1 in the current supply chain is an indirect positive impact. However, SDG8 (see section 3.2.8) might provide a better understanding of how the supply chain impacts economic development. The indicators for target 1.4 is broad and aim at measuring the proportion of a population that has access to basic services and the ratio of adult populations with secure rights to land (United Nations, 2015). This definition explains why economic development might be a more relevant indicator for this goal in the context of the battery supply chain. SDG1 aims at ending all forms of poverty across the world and consists of seven different targets (United Nations, 2015). Target 1.4 "ensuring equal rights for re- sources" (United Nations, 2015) is of most relevance to the Li-Ion battery supply chain. SDG1 aims at ensuring equal rights to economic resources. In the context of the Li-Ion battery supply chain, this includes not only access to raw materials and nat- ural resources but also to technology and the end product. Mineral deposits are concentrated in small geographical areas which inherently makes their disposition unequal across the world. Furthermore, access to technology is highly nationalized, and in a further respect, in the control of private companies. With technology, geo- graphical areas, and resources being in the control of private companies, this brings competition where the resources are located through land use as exemplified in the salt flats in South America (United Nations Conference on Trade and Development, 2020). Within this region, local farmers have to compete for water and land use with companies extracting lithium from brines (United Nations Conference on Trade and Development, 2020). However, Loayza and Rigolini (2016) found that the min- ing district in general have lower poverty than districts without mining. Therefore mining might help combat poverty. 25 3. Current battery supply chain 3.2.2 SDG2 - Zero hunger We argue that the final impact assessment of the current supply chain is no impact because of the risks are mostly positioned in the future and the connections are not clear for SDG2 with the connected targets. SDG2 could be considered to have indirect connections with the current supply chain in terms of pollution and drought caused by extraction as well as increased electricity prices from production but assessed not clear enough in the context of SDG2. SDG2 is defined as ”End hunger, achieve food security and improved nutrition and promote sustainable agriculture” by the United Nations (2015). The focus of the targets of SDG2 is increasing food production in a sustainable way and ensuring nutritious food for all people. Supporting a resilient and robust food production in terms of both pricing and protection against climate change is also one main area within the targets (United Nations, 2015). One example seen is the waste from the extraction of both nickel and lithium is at risk of polluting the surrounding groundwater and soil (Nevskaya, Seleznev, Masloboev, Klyuchnikova, & Makarov, 2019; Sadik-Zada, Gatto, & Scharfenstein, 2023). This has a direct negative impact if there is surrounding agriculture, which may pollute food production. Lithium brine’s extensive water usage might also cause drought, negatively impacting surrounding livestock and farms. However, these kinds of con- flicts are currently rare (Sadik-Zada et al., 2023). Therefore, drought risks from lithium production are currently not considered to have an impact on SDG2. Electricity usage for battery production has an indirect negative impact on food production. The total global battery capacity is estimated to account for 15% of the total dispatchable energy capacity in 2030 (International Energy Agency, 2022k). This could indirectly affect food producers by increasing the price of electricity due to an increase in demand for electricity. However, we argue that this effect on electricity prices has no impact as there is extensive work towards increasing the electricity generation capacity following the increase in demand, which is shown in International Energy Agency (2022k). 26 3. Current battery supply chain 3.2.3 SDG3 - Good health and well-being The final impact assessment of SDG3 is that the cur- rent supply chain has an indirect negative impact on the goal. We argue that even though there are pro- posed regulations that could have a positive impact on SDG3, these have directly followed the negative impacts on both environment and workers from the battery sup- ply chain. SDG3 covers a variety of issues for good health and well-being. Two targets is iden- tified as most relevant to the battery supply chain. First, target 3.9 ”By 2030, sub- stantially reduce the number of deaths and illnesses from hazardous chemicals and air, water and soil pollution and contamination”. Second, target 3.D ”Strengthen the capacity of all countries, in particular developing countries, for early warning, risk reduction and management of national and global health risks” (United Nations, 2015). Analyzing the battery supply chain from a health aspect, the large amount of toxic minerals handled increases the risk of negative effects on workers and the environ- ment. Nickel is considered one of the most toxic minerals in the world (Parmar & Thakur, 2013). Workers in contact with the mineral can experience the most com- mon health effect dermatitis, commonly known as ”nickel-allergy”, which causes itching and sore skin (Parmar & Thakur, 2013). When exposed to higher levels of nickel, there are further risks, such as the development of bone, lung, and nose cancer (Parmar & Thakur, 2013). Negative aspects can be caused by lithium as well. Lithium is considered highly toxic at high concentrations (Bolan et al., 2021). The chemical properties of lithium allow it to have high mobility when released in nature and groundwater. This could direct it into both drinking water as well as plants that have the ability to more easily absorb lithium, causing increased toxicity within these (Bolan et al., 2021). Large exposure to lithium can cause disruptive heart rates, whereas overdoses can lead to coma (Bolan et al., 2021). However, lithium is also a well-used treatment for bipolar disorder (Łukasz, Rybakowska, Krakowiak, Gregorczyk, & Waldman, 2023). There are also established health risks connected to this treatment, which among others affect kidney function Łukasz et al. (2023). Bolan et al. (2021) states that there is an urgent need for further research. We argue that this is strongly connected with the need to analyze the actual impacts of the increased waste followed by the increased demand for EV batteries. Within the EU there are several initiatives that have affected the worldwide bat- tery supply chain. One of them is the ”The European Green Deal” which also has strong connections with new proposed regulations that EV batteries, Light means of transport (LMV), as well as industrial batteries with capacities above 2kWh, will 27 3. Current battery supply chain be required to have a ”digital battery passport” (European Parliament, 2022, 2023). This implies that battery manufacturers need to adhere to standards for traceabil- ity of the minerals used in a specific battery together with information such as capacity, performance, durability, and chemical composition (European Parliament, 2022). This applies pressure on battery manufacturers worldwide to openly share information about their mineral composition, which also aspire these companies to ensure a clean battery supply chain. These new regulations have a clear positive impact, where worldwide battery production is required to meet these standards. 3.2.4 SDG4 - Quality education The final impact assessment of SDG4 and the con- nected targets is an indirect positive impact. Both the mining and educational initiatives from the companies mentioned are shown to have positive impacts, however these initiatives in relation to SDG4 are hard to mea- sure. SDG4 is defined as ”Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all” (United Nations, 2015). The connected targets have an overall focus on establishing an infrastructure to ensure quality education for all citizens, for children as well as increasing knowledge towards sustainability and technology advancements (United Nations, 2015). Studies have shown that mining industries create a positive impact on education in the surrounding local area. This is explained in Hajkowicz, Heyenga, and Moffat (2011) where case studies have been made on the Australian mining industry. The result from the study shows that mining is positively associated with several areas of life improvement, including educational attainment (Hajkowicz et al., 2011). This should also be considered a positive impact in the context of the battery supply chain as both nickel and lithium are produced for the battery industry in Australia. However, we argue that this should be considered an indirect positive impact on SDG4 as this is an effect of the existence of the mining industry as a whole and not specifically nickel and lithium. The second area which has a positive impact on SDG4 is the direct work of larger companies within the battery supply chain that embrace education for the employees or through other initiatives. This is shown by Contemporary Amperex Technology Co., Limited (CATL), one of the world’s largest battery manufacturers that provides opportunities for education within the company, without any earlier experience re- quired (CATL, 2023). The goal of the education program is to offer a position at the company when it is finished (CATL, 2023). Another example is LG Chem, also one of the largest manufacturers in battery production. The company has several initiatives not only connected with company education but also an additional focus on youth education which is part of their social contribution activities (LG Chem 28 3. Current battery supply chain Ltd., 2019). These two examples show a direct positive impact on SDG4 and the targets because of the active work from these major companies. 3.2.5 SDG5 - Gender equality The final impact assessment on SDG5 is assessed as an indirect negative impact. There is substan- tial work remaining for gender equality to reach the goals of Agenda 2030 and to achieve gender equality for the countries active within the supply chain. SDG5 is defined by the UN as ”Achieve gender equality and empower all women and girls ” (United Nations, 2015). This goal consists of 9 different targets (United Nations, 2015). Many of the targets for SDG5 are not directly impacted by the Li- Ion-battery supply chain, however, we hypothesize that the supply chain certainly does have indirect effects. Abrahamsson et al. (2014) explain that women face a variety of problems in mining which go against SDG5 such as harassment, and discrimination due to mining be- ing male-dominated and restrictive norms. Abrahamsson et al. (2014) argues that this negatively impacts local communities as well as the workers who are a part of those communities. Harassment and discrimination hinder a diversity of lifestyles and hamper the development of gender equality (Abrahamsson et al., 2014). SDG5 can be tracked via the Gender Inequality Index (GII). The index tracks empowerment, reproductive health and labor (United Nations Development Pro- gramme, 2023). A lower score in the index is more equal, and a higher score is less equal. The largest producing countries in terms of nickel and lithium within the current supply chain ranks as follows in table 3.2. Table 3.2: Gender Inequality Index (GII) rank and value for the largest actors within the Li-Ion-battery supply chain. Data from 2021 and via United Nations Development Programme (2023). GII Rank GII Value Canada 17 0.069 Australia 19 0.073 Chile 47 0.187 China 48 0.192 Russia 50 0.203 Indonesia 110 0.444 Australia and Canada rank highly and quite close in the GII whilst Chile, China, 29 3. Current battery supply chain and Russia rank quite a bit lower, all with fairly similar GII values as seen in table 3.2. Last is Indonesia which ranks at place 110 with a GII-the value of 0.444 which is low and indicates severe inequality. Although indices are general across each country, the GII gives an indication of the differences as the largest actors operate within these countries in the battery supply chain. This in turn can provide an indication of the severity of structural inequality across genders. Furthermore, as the supply chain itself is diverse and spans across industries, the index provides an understanding on an aggregated level regarding SDG5. Data from the GII is used by the UN to track the progress of SDG5 as well. 3.2.6 SDG6 - Clean water and sanitation The final impact assessment on SDG6 from the cur- rent supply chain is assessed as having a direct neg- ative impact. Extensive water usage and pollu- tion from the extraction of minerals are shown to be areas with the most negative impact. Mit- igation is required in order to meet these chal- lenges. Clean water and sanitation consist of a number of targets where target 6.3 is the most relevant target for the battery supply chain. This target is defined by the United Nations (2015) as "improve water quality by reducing pollution, eliminating dumping and minimizing release of hazardous chemicals and materials, halving the proportion of untreated wastewater and substantially increasing recycling and safe reuse globally". The negative impacts can be seen in the surrounding areas of mining operations. One study made by Nevskaya et al. (2019) on the Allarechensk Copper-Nickel Min- ing Waste Dump showed extensive nickel pollution in all of the closely positioned water bodies. The examinations showed that the nickel concentration was between 3 and 79 times higher than the Maximum Permissible Concentration (MPC), with the highest observed value at 4736 times higher than the MPC (Nevskaya et al., 2019). One large challenge regarding lithium brines is extensive water usage (Sadik-Zada et al., 2023). Lithium brines are saltwater themselves, however in the evaporation process, freshwater is flowing into the brine from below (Sadik-Zada et al., 2023). This leads to a decrease in groundwater levels, which in turn could lead to droughts for the surrounding inhabitants, as well as endangering their livestock. Further- more, according to Sadik-Zada et al. (2023), rainwater and groundwater are directly used in lithium extraction. Conflicts in rural areas where extraction is taking place have less demand for water because of the scarce number of inhabitants. However, Sadik-Zada et al. (2023) argues that with an increase in lithium extraction, future conflicts may arise. 30 3. Current battery supply chain Another challenge of the extensive water usage required can be seen in Chile (Liu & Agusdinata, 2020). The stored water level, which includes soil moisture, surface water, and groundwater of Chile decreased by 1.16mm per year between 2002 and 2017. The mining industries use 50 times the total water usage of the country (e.g. 50 times the water usage of the country with the mining industry excluded), and 100 times the amount of the tourism industry Liu and Agusdinata (2020). We argue that this is a direct negative impact on SDG6 even though the measurement is for the mining industry as a whole. This is because Chile is one of the largest producers of lithium, which makes the extensive water usage of lithium brines a large part of the total mining water usage. 3.2.7 SDG7 - Affordable and clean energy The final impact assessment on SDG7 from the current supply chain is assessed to have a direct negative impact. This is assessed by analyzing the energy mix in the coun- tries where the largest actors are active. It is assumed that all actors use the average energy mix within the country and that no special contracts for renewable en- ergy for the actors’ production are used. As shown in table 3.3, the average energy mix for the largest countries is highly varied. How- ever, the average of renewable energy sources in the energy mix over the largest countries is 31.5%. China is the main location for many of the largest actors, where the share of renewable energy sources is 26.7%. As all different stages of the supply chain consume electricity, everything from the extraction of the ores to the refinement and the production of battery cells, it can be concluded that the lack of renewable energy sources has a large effect on SDG7. SDG7 is defined by the UN as ”Ensure access to affordable, reliable, sustainable and modern energy for all” (United Nations, 2015). This is a highly relevant goal for all the parts of the supply chain ranging from the extraction of raw materials to the production of batteries for electric vehicles as all these parts are energy intensive. Note that the definition of the goal specifically denotes the attributes: affordable, reliable, sustainable, and modern. The targets for SDG7, include target 7.2 which defines modern energy as renewable energy with the specific target of substantially increasing the share of renewable energy in the energy mix (United Nations, 2015). Based on this target, the notions of sustainable and modern can be joined together and analyzed based on the data in table 3.3. The United Nations defines renewable energy as solar, wind, geothermal, hydro, ocean, and bio-energy (UN, 2022). 31 3. Current battery supply chain Table 3.3: The energy mix of the largest countries in the current battery supply chain for lithium and nickel. Data from The International Energy Agency (International Energy Agency, 2022a, 2022b, 2022c, 2022d, 2022f, 2022i). Australia Canada Chile China Indonesia Russia Coal 53% 5.7% 30% 63.4% 62% 16.1% Natural gas 18.8% 12% 18% 3% 16.4% 43% Hydro 5.7% 59.2% 19.2% 17.4% 8.3% 19.7% Wind, solar, etc. 19.2% 6.3% 20% 9.3% 5.5% 0.3% Biofuels and waste 1.2% 16.4% 6.5% 1.8% 5% 0.4% Oil 1.8% 0% 5.2% 0% 2.7% 0.6% Nuclear - 14.4% - 4.7% - 19.7% In all the countries where the largest actors are active in the supply chain, 99.6% to 100% of the populations have access to electricity based on the available data (International Energy Agency, 2022a, 2022b, 2022c, 2022d, 2022f, 2022i). It can be determined from this data that all the largest actors have access to reliable energy. 3.2.8 SDG8 - Decent work and economic growth We argue that the final impact assessment of SDG8 from the current supply chain should be assessed as indirect positive. There are benefits and drawbacks to the cur- rent supply chain. Workers’ safety is a clear negative part of the supply chain. However, the current develop- ment seen in the industry will create further employment opportunities and economic growth, which is positive. SDG8, Decent work and economic growth aim at promoting sustainable and inclu- sive economic growth together with productive employment and work for all (United Nations, 2015). The goal consists of 12 targets in relation to work, labor rights, eco- nomic growth, economic productivity, employment, and safe working environments (United Nations, 2015). Hajkowicz et al. (2011) found that the mining industry in Australia is positive for income and employment. We argue that the same can be assumed in the rest of the world - that the mining industry provides jobs and economic growth, especially combined with the increasing demand for materials required for EVs. Walser (2002) shows that mining increases local opportunities for employment. This is not only economic benefits, but also positive social effects for the surrounding communities (Walser, 2002). The downstream parts of the supply chain, mainly industrial man- ufacturing, also provide these benefits to the surrounding local area. 32 3. Current battery supply chain The UN (n.d.) explains that the current economic recovery from the negative eco- nomic effects in the wake of covid-19 is further slowed down by inflation, uncertain- ties, challenges in the labor market, and supply chain disruptions. One of the main risks for supply chain resilience within the Li-Ion-battery supply chain is geopolitical risks connected to 90% of lithium reserves being located in only five countries (as discussed in chapter 1.4.3). A strong supply chain resilience to avoid supply chain disruptions is therefore paramount to sustainable economic growth. With supply chain disruptions such as Russia’s invasion of Ukraine (The Visual Journalism Team BBC News, 2022) and the recent US-China trade war (Kapustina, Lipkova, Silin, & Drevalev, 2020), some countries where top actors within the supply chain are located are currently engaging in activities that hamper economic growth. The ge- ographical concentration of lithium could therefore lead to future negative impacts on the resilience of the supply chain and SDG8 Target 8.8 aims at promoting safe working environments and protecting worker rights (United Nations, 2015). Nickel itself is highly toxic and the extraction of nickel can be potentially harmful if not handled correctly, not only for workers but also for the surrounding environment (Sadik-Zada et al., 2023). This impact can in turn have negative consequences for the local community as well, as seen in Norilsk where lung cancer is 1.2-2.5 times more common (Lavelle M, 2021). With these facts in mind, the safe working environments of nickel extraction can be questioned and should be considered when discussing the current attributional impact on SDG8. 3.2.9 SDG9 - Industry, innovation and infrastructure The final impact assessment of SDG9 from the cur- rent supply chain is a direct positive impact. A united front is seen, bringing the research of technological de- velopment and infrastructure for EVs and batteries for- ward. SDG9 is described by the United Nations (2015) as ”Build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation”. Almost all of the targets in this goal are considered to be relevant since battery technologies are being further developed and researched worldwide in several different contexts (International Energy Agency, 2022e). A clear example of technological development in the battery supply chain is the development of HPAL nickel processing. Developments of HPAL processing are made possible by larger companies due to the extensive capital cost (Meshram et al., 2019). This can be seen in Indonesia where a large HPAL plant started oper- ating in 2021, financed through a joint venture between Harita Group and Chinese company Ningbo Lygend Mining Co. (International Energy Agency, 2022e). An 33 3. Current battery supply chain additional HPAL plant is expected to be finished in Indonesia in 2025 and is consid- ered to become the world’s largest plant (Reuters, 2023). However, the processing of the low-grade laterite ores releases three times the amount of ghg compared to the processing of sulfide ores (International Energy Agency, 2022e). We argue that the emissions should be considered outside the scope of SDG9. Therefore, this solution allows more efficient use of resources through innovation, together with possibilities for further developments on HPAL, which therefore has a direct positive impact on SDG9. Innovation of HPAL can be seen in companies such as Clean Teq in Australia. The company has focused on making the HPAL processing clean by powering the plant through solar panels instead of the normally used coal-fired boilers (International Energy Agency, 2022e). Heat and steam generated from the HPAL plants can be recovered and could be used to power other activities (International Energy Agency, 2022e). This is a clear example where the battery supply chain development has a direct positive impact on SDG9. The development of the EV supply chain has seen extensive support from gov- ernments worldwide. Masiero, Ogasavara, Jussani, and Risso (2016) presents that the government of China has subsidized EVs in order to decrease pollution, generate jobs and bring technological development forward since the country took a leading position in the development of EVs back in 2009. Masiero et al. (2016) discusses that tax benefits are one specific supporting factor that has encouraged EV pro- ducers to continue EV-development. These tax benefits have been made available both from the central government as well as local districts (Masiero et al., 2016). However, Li, Yang, and Sandu (2018) discusses that currently the authorities are fragmented within the country which can pose challenges due to different standards, depending on the geographical position. A centralized decision unit therefore could have a positive impact on coordination (Li et al., 2018). The governmental support through policies and tax benefits shows a direct positive impact on SDG9, bringing incentives for further developments within the industry. Further examples of government support can be seen in China’s infrastructure. One example is the rapid growth of charging stations within China. The number of charging stations has gone up from 440,000 in 2017 to 3,521,000 in 2021 (Lau, An- drew Wu, & Wing Yan, 2022; Li et al., 2018), which may have been the result of the implementation of policy incentives. This should also be considered a positive impact. 34 3. Current battery supply chain 3.2.10 SDG10 - Reduced inequalities The final impact assessment on SDG10 from the current supply chain is assessed as no impact. The current supply chain does have an impact on equality in the world, how- ever, we argue it is negligible. The most relevant targets within the supply chain are the equalization of income for the bottom 40% of the population (target 10.1) and the promotion of social, economic, and political inclusion (target 10.2). SDG10 aim at reducing inequality among and within countries (United Nations, 2015). The goal consists of ten separate targets which focus on reducing inequality based on income, inclusion, opportunities, improving regulation, representation, and immigration (United Nations, 2015). The targets of SDG10 intersect with SDG5, Gender Equality, and SDG1, No Poverty as the targets of SDG10 carry similarities. This can be seen in SDG5 how women face discrimination within the mining industry which goes against the goal of re- duced inequality as well (Abrahamsson et al., 2014). The extraction of raw materials and their deposits provide unequal opportunities in different communities which is problematic in terms of SDG1 (Loayza & Rigolini, 2016). Furthermore, there are unequal opportunities in terms of who controls the land, resources, and water which intersects with the targets of SDG1 (United Nations Conference on Trade and De- velopment, 2020). 3.2.11 SDG11 - Sustainable cities and communities We argue that the final impact assessment of SDG11 from the current supply chain is indirectly negative. The nodes in the supply chain are highly differentiated and the nodes are therefore conducive to a variety of issues. For example, nickel production can lead to highly pol- luted air as seen in Norilsk, Russia, where the amount of sulfur dioxide in the air is around the same as from a currently erupting volcano (Lavelle M, 2021). This in turn has increased the risk of lung cancer by 1.5-2 times which negatively affects nearby communities (see Section 1.4.2). SDG11 aims at making cities inclusive, safe, resilient, and sustainable (United Na- tions, 2015) and consists of 10 targets (United Nations, 2015). Cammarano, Perano, Michelino, Del Regno, and Caputo (2022) argue SDG11 is one of the most relevant goals for supply chain management. Although this can be true for supply chain management in general, it is not necessar- 35 3. Current battery supply chain ily the most relevant SDG for the Li-Ion battery supply chain as many of the areas in which supply chain management has its’ largest impact are from ghg emissions in last-mile solutions1 (Cammarano et al., 2022). The most relevant targets of SDG11 include target 11.6 which aims at reducing the per capita environmental impact of cities (United Nations, 2015). One of the largest risks to consider for nearby cities and communities for lithium extraction is water quality. The pollution of lithium into groundwater can have negative health consequences which can impact nearby communities as discussed in the context of SDG3 (see Section 3.2.3). The largest risk for open-pit lithium mines is possible water pollution and can therefore negatively impact nearby communities (Crespo-Cebada et al., 2020) (see Section 1.4.3). The factors which impact SDG11 are highly interconnected with SDG3, SDG6, SDG7, SDG8 and SDG12 (See sections 3.2.3, 3.2.6, 3.2.7, 3.2.8, 3.2.12). 3.2.12 SDG12 - Responsible consumption and production We argue that the final impact assessment on SDG12 from the current supply chain is a direct positive impact. Sustainable solutions are required in order to create a balance of consumption as the battery industry grows. There are clear examples of initiatives towards reaching the targets of for example waste management and solu- tions within the battery supply chain and maximizing material and mineral efficiency. SDG12 focuses on sustainable consumption and production which is highly rele- vant in the context of the growing battery demand. The targets most relevant to the battery supply chain are ”12.2 By 2030, achieve the sustainable management and efficient use of natural resources”, ”12.5 By 2030, substantially reduce waste generation through prevention, reduction, recycling and reuse” and ”12.A Support developing countries to strengthen their scientific and technological capacity to move towards more sustainable patterns of consumption and production” (United Nations, 2015). Governments are motivated to contribute with policies that bring the battery in- dustry within the country forward. China’s dominance in the downstream produc- tion of batteries has been made possible by favorable support with policies from the government as discussed in SDG9 (See section 4.4.9. Monteiro, da Silva, and Moita Neto (2019) shows that companies who collaborate with the government pro- mote campaigns connected to waste management more willingly and in a more prac- tical approach. Furthermore, Monteiro et al. (2019) discusses that a more proactive approach to waste management generates value both from decreased waste, but also 1Last mile is defined as the last part of the delivery of products to a customer. This part is often characterized by a short distance (Hayes, 2022). 36 3. Current battery supply chain together with the value from minerals that otherwise might be considered as waste. The increased focus on waste management is a direct positive impact on the goal, especially targets 12.2 and 12.5. There is a further need to drastically increase mineral production as demand for battery minerals is growing. HPAL is one of the technologies brought forward in order to transform low-grade nickel into high-grade, which can be used in batter- ies International Energy Agency (2022e). However, HPAL has three times higher emissions of ghg compared to the processing of nickel from sulfides (International Energy Agency, 2022e). This has a direct negative impact on the goals. There are