Giant Chinese nickel and steel producer plans suite of renewable energy plants

A Chinese group aiming to supply nickel for electric vehicles (EVs) is planning a suite of renewable energy plants in Indonesia to clean up its metal smelters and meet demands from carmakers for greener battery materials.

Tsingshan Holding Group, top producer of nickel and stainless steel, will build 2,000MW of solar and wind capacity in the next three to five years in Indonesia, it said on WeChat on Monday. It is planning 5,000MW of hydropower, it said without giving a timeline.

The company wants its battery materials operations to be netzero on carbon emissions.

The group last week unveiled plans to make battery-grade nickel from material previously reserved for stainless steel, a route that now depends on smelters that consume much coal-fired power.

“Green metal is very important for the EV market, especially for example in the US or Europe,” Ellie Wang, analyst at CRU Group in Shanghai, said.

“If Tsingshan can stop depending on coal in Indonesia and get electricity from renewable sources, it could address concerns” over emissions, she said. Tesla’s Elon Musk has repeatedly flagged the need for environmentally sound sources of nickel. Last year, he promised a “giant contract” to companies that could offer the right kind of supplies. Last month, he said nickel was the company’s biggest concern for scaling up battery output.

Nickel last week suffered its biggest two-day loss in a decade after Tsingshan’s latest batteryfocused project was unveiled. The move opens up a big, new source of supply in Indonesia, which is trying to attract global EV and battery giants to set up factories. “Tsingshan aims to provide sustainably produced nickel to the battery sector,” Allan Ray Restauro, analyst at BloombergNEF, said. “EV and battery manufacturers are increasingly more concerned about the nickel that enters their supply chains.”

Tsingshan said its plants in Indonesia producing nickel pig iron are among the world’s cleanest of their kind. Almost 100% of similar producers in the world rely on coal power,. Tsingshan’s method, in which hot metal is fed directly to stainless steel plants, cuts power use 30%, it said.