The European Commission contemplates to classifying lithium as toxin hampering EV revolution

The European Commission (EC) contemplates classifying lithium as Category 1A reproductive toxin means that the substance is adverse to human reproductive abilities. Sources said that enlisting lithium as a toxin material can significantly hinder Europe’s Electric Vehicle market by restricting the battery materials supply chain.

Reportedly, the European Chemical Agency’s Risk Assessment Committee has agreed with the French proposal to classify lithium carbonate, lithium hydroxide, and lithium chloride as category 1A reproductive toxins in 2021. The proposal is currently being reviewed and a report is expected to be published between October and December this year.

International Lithium Association Secretary-General Roland Chavasse said, “The risk is that if lithium salts are incorrectly reclassified as 1a/SVHC it would introduce great uncertainty to long-term business viability planning of investments around these three salts.” He also added that the Category 1A classification of substances under the EU makes it a high-concern subject that can be restricted by the EU’s Chemical Strategy for Sustainability.

The classification of lithium as a toxin material can diminish the EU lithium battery supply chain. Lithium is extracted via mining, processing, cathode production, and recycling. The proposed restriction can discourage lithium extraction and impact the processing of lithium. It can also discourage the miners to work in the lithium extraction process affecting its public support.

Mr. Chavasse said, “The impact on refining projects would be very negative, but it would again depend on which risk management measures will be developed.” The EU’s domestic battery chain will be forced to produce less lithium while China would be at a great advantage. This can significantly increase the value of lithium increasing its costs across the EU and thwarting the local supply chains.

However, there is no indication of whether the proposal will be approved. The Vulcan Energy Resources Chief Commercial Officer Vincent Ledoux Pedailles said that the EU is planning to become self-sufficient by 2025 in EV lithium-ion battery productions. They are planning to increase almost 80% domestic lithium production by the next five years along with a target of 35% lithium recycling by 2019. The proposal is counterproductive to their target and opposes the EV market directly. He has also mentioned that there are officials working on canceling the proposal in the EC as well.