Investissement Québec has significantly contributed to steering the development of the battery sector, a project that its president and CEO, Guy LeBlanc, describes as “the most important since James Bay”. During a meeting with chambers of commerce in Mauricie and Centre-du-Québec, Mr. LeBlanc discussed with Le Devoir the long road that remains to be covered for the sector to materialize.
What are the key elements of the battery sector?
What will really be a big asset for the Quebec economy is to have the complete chain. We are perhaps one of the only states in the world which will have this complete sector, from the mine to the battery, and which will also do recycling. Ontario does not have this complete chain. It may work to do so or simply feed from us for its cell factories. According to the English media Benchmark MineralQuebec should be able to supply approximately 28% of the cathode needs of North American automobile manufacturers by 2030.
Public and private investments in the sector, currently worth 15 billion, could double in the coming years, you judge. What are the next steps ?
The fundamental elements are in place, but there are small components that would be good to have in Quebec. There is, for example, manganese and the electrolyte, which is the liquid that circulates ions between the anode and the cathode. These are products that can be obtained without difficulty on the international market, but that we would like to have here, as long as we have this complete chain. But the bulk of the additional sum would come from phases two and three of projects already announced. Most of these factories will double their capacity. These new phases will be subject to an examination by the BAPE [Bureau d’audiences publiques sur l’environnement]because it exceeds the limit set by the Ministry of the Environment.
In which sector could there be projects that have not yet been announced?
Saguenay–Lac-Saint-Jean would have the potential to welcome big names. We’re not there yet. It’s premature to talk about it at this point. But we have all the elements that look a bit like Bécancour, a deep water port and industrial land. It could be in the anode and cathode sector.
Is it necessary to invest so much public money to develop this sector?
Thanks for the question. That’s what makes me start my days in a bad mood, when I hear about “all these subsidies” on the radio. Of the 15 billion, there is approximately 20% funding from the Quebec government and approximately the same share from the federal government. There is therefore 60% private money invested in these projects. Concerning Quebec’s money, approximately 3 billion, the majority is made up of loans to be repaid with an interest rate. There are also equity investments in these companies. The smallest part is made up of forgivable loans, which will be forgiven when the company has delivered what it was supposed to deliver. So yes, there is public money, but it is structured to obtain a return for Quebec.
Are there any risks associated with these investments?
The answer is yes, for sure. But it is certain that the battery sector will exist in 10 years. Not only because of electric transportation, but also because of the shortage of clean energy. There will need to be more and more storage in batteries to compensate for the intermittency of wind and solar power. When it comes to technologies, we did our studies with people who know about it, including the Hydro-Québec Research Center. The type of batteries produced here will remain the most sought after and the most popular for autonomy and rapid recharging. Factories can be adapted to certain technological changes.
Today we see that the electric vehicle manufacturer Lion Électrique is making significant layoffs. Are we putting this industry on a pedestal?
We talk about it a lot, that’s for sure. We give the impression that we put all our eggs in one basket. But there is still money to increase productivity and innovation in Quebec businesses, in all sectors. The risks are mainly in execution. All we have managed so far is to make announcements and start construction. What keeps me awake is construction and completion times, being able to find and house workers. Currently, there is an economic slowdown. It is certain that this can delay certain projects by 6 to 12 months. But I have no concerns about the sector as a strategic choice.
We learned that there is no threshold for Quebec content that will be requested by the government and that Northvolt will bring in workers from abroad. What will be the local economic benefits?
To make batteries, it takes critical minerals, labor and clean energy. We have all that in Quebec. So we don’t need to put in place any requirements. It looked like we were wearing suspenders with our belt. As for construction, look at what is currently happening in Bécancour: 90% of the contracts awarded to date have been to Quebec companies, half of which are from the Bécancour region. The role we play at Investissement Québec is to put suppliers in touch with project managers.
What role do municipalities and citizens play?
Social acceptability is the primary responsibility of municipal councils, which must fully understand the needs of their citizens. I don’t have the pulse of the people of Bécancour, but Lucie Allard, the mayor, has that pulse. At the start of the project, we met, and she explained to me what was important for the people of Bécancour. They are skeptical. The industrial park has been promising projects for 45 years. There is nothing that has materialized yet. So we want to reassure them, tell them that we are not selling them air.