Tesla to spend over $1bn on battery minerals from Australia

Tesla has said it expects to spend in excess of $1 billion a year on purchasing raw materials for batteries from Australia, given the country's reliable and generally responsible mining practices.

Tesla chair Robyn Denholm said that Australia was now in a good position to benefit from the rapidly developing electric vehicle battery supply chains - thanks to being rich in minerals such as lithium and nickel - as well as from the increased investor and consumer focus on environmental, social and governance (ESG).

"We expect our spend on Australian minerals to increase to more than $1 billion per annum for the next few years," Denholm told a Minerals Council of Australia event in Canberra.

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She added that Australia is the source for around 75% of Tesla's lithium feedstock and more than a third of its nickel.

"Australian mining companies do have a good reputation, great expertise, professionalism and are preferred by manufacturers increasingly concerned about meeting both today’s and the future’s ESG requirements," she said.

Denholm's comments align with a new policy enacted by the Biden administration in the US, which relies on allies for the majority of the metals and minerals required for electric vehicles.

The policy would see the US then process the raw materials domestically into battery parts. It is a strategy meant to placate environmentalists, strengthen ties with allies and also promote employment in US industry.

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Canada and Brazil are likely to benefit from the policy, as well as Australia.

It is expected that Australian exports of hard rock lithium - also known as spodumene - are likely to reach AU$1 billion (€635 million) in 2021, with nickel exports predicted to reach AU$4 billion (€2.5 billion).

Tesla also supplies energy storage batteries to Australia to store solar power captured from rooftop panels. Australia has the world's highest per capita density of rooftop solar panels.

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