By M. Marin

NASDAQ:NVX

READ THE FULL NVX RESEARCH REPORT

Novonix’s Anode Material Outperforms in Direct Testing

Novonix (NASDAQ:NVX) is focused on producing high performance long lasting materials that meet evolving specifications and are produced in more sustainable and efficient ways compared to competitors. Novonix has developed an efficient, low-cost process to produce synthetic graphite anode material that is designed to be competitive with the current supply sourced primarily from China and in testing its materials, the company has found that they are as or more effective compared to other products. In a study comparing its synthetic anode graphite material to that supplied from China, the Novonix material demonstrated a roughly 30% to 60% decrease in GWP (global warming potential) when compared to synthetic graphite produced in two key regions in China that account for a combined 79% of global production of synthetic anode material, according to the study.

All in all, the company has tested its anode materials compared to industry leading materials including a Tesla Model S cell used as a reference benchmark and based on test results, the company believes that its anode material outperforms in direct head-to-head testing.

Cathode critical for lithium-ion batteries; Recent funding earmarked to advance cathode development…

The Novonix Cathode Materials unit is also key to the company’s strategy, as is the BTS unit, which will continue to be the company’s R&D and technology testing group. The company had commissioned global engineering consultancy firm Hatch Ltd. and Hatch recently delivered its report evaluating NVX’s all-dry, zero-waste cathode synthetic process compared to the conventional process. The study concluded that Novonix’s process potentially could reduce power consumption by an estimated 25% and nearly eliminate waste byproduct generation. Reflecting these and other factors, the company also estimates its process could lead to processing cost reduction of about 50% (excluding material feedstock costs) and potentially lower capital costs by an estimated 30%. The company therefore views it as a greener and more cost efficient production process compared to the conventional.



… And to develop AI-enabled technology to help optimize battery performance & lifespan

NVX has earmarked a portion of up to CAD$3 million (USD$2.23 million) in R&D funding and advisory services the BTS division is receiving from the National Research Council of Canada Industrial Research Assistance Program (NRC IRAP) to advance the development of the all-dry, zero-waste cathode materials and pilot line. Another portion of this funding will be earmarked for new technology to predict the lifespan of lithium-ion batteries following the company’s recent collaboration with SandboxAQ.

SandboxAQ is an enterprise SaaS company that combines artificial intelligence (AI) with quantum analysis, leveraging SandboxAQ’s AI-driven chemical simulation software. Specifically, NVX and SandboxAQ intend to collaborate to to leverage SandboxAQ’s AI-driven chemical simulation software combined with NVX’s proprietary technology to predict the lifespan, performance and efficiency of lithium-ion batteries. With demand for lithium-ion batteries expected to grow dramatically, optimizing battery performance and lifetime and reducing battery costs are critical. NVX believes the two partners can improve on assessment models currently in use, leveraging its technology, AI and machine learning (ML) algorithms to, in turn, accelerate innovation.

Many strategic relationships secure demand, funding, access to networks…

The company has formed many agreements to secure demand for its anode materials, including with Kore Power and LG Energy Solution (LGES), a leading provider of battery technologies to the green automotive and mobility, IT and ESS & other areas. Supply agreements with Kore and LGES are key components behind the company’s strategy to ramp production capacity at its Riverside facility in Tennessee. Novonix expects to begin delivering 3,000 TPA of synthetic graphite to KORE in 2024 and LGES will have the option to purchase up to 50,000 tons of artificial graphite anode material over a 10-year period once mass production commences at NVX’s Riverside facility.

Moreover, with LGES, as with Philips 66 earlier, NVX also secured partner funding. The Kore, LGES and other strategic relationships underscore the positives of Novonix’s business plan and growth strategy, in our view. We would anticipate similar measures for the Cathode Material unit, as cathode development and testing progress.

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