Vice presidential candidate Gibran Rakabuming Raka mentioned lithium iron phosphate (LFP) during the debate on Jan. 21. (Photo: Prabowo Subianto's Facebook)
During the fourth debate of the Indonesian presidential elections, discussions were ignited on the country’s social media after the vice-presidential candidate from the Great Indonesia Movement Party (Partai Gerakan Indonesia), Gibran Rakabuming Raka, mentioned lithium iron phosphate (LFP) electric vehicle batteries.
This sparked widespread concern, especially considering Indonesia has the largest nickel reserves in the world. Worries emerged regarding the potential loss of advantage for the country with the development of lithium iron phosphate batteries.
Batteries containing precious metals such as nickel and cobalt, particularly lithium-ion batteries, have been favored by many electric vehicles manufacturers due to their excellent overall performance in terms of range, size, as well as power. However, their relatively higher cost has led the market to actively seek alternatives. The emergence of this lithium iron phosphate batteries, which are not rely on nickel, has gained prominence, especially with the endorsement of giant electric vehicle company, Tesla.
A report from the International Energy Agency (IEA) reveals that the proportion of Tesla electric vehicles using lithium iron phosphate batteries increased from 20% in 2021 to 30% in 2022.
Fahmy Radhi, an energy observer from Gajah Mada University (UGM) in Indonesia, stated that the production cost of lithium iron phosphate is cheaper than nickel. Therefore, during the development process, if the price becomes more affordable and the quality surpasses that of nickel, there’s a possibility that the entire world may abandon the use of nickel in favor of lithium iron phosphate.
Lithium battery pack module for EV. (Photo: iStock)
According to statistics from the Institute for Energy Economics and Financial Analysis (IEEFA), Indonesia’s electric vehicle market in 2022, 75% of vehicles utilize lithium iron phosphate batteries, including models like the China’s Wuling Air EV. Moreover, with the major China’s electric vehicle manufacturer BYD entering the Indonesian market, it is anticipated that the adoption rate will increase even further. BYD is a significant user of lithium iron phosphate batteries, constituting 50% of the global demand. In addition, approximately 95% of the world’s lithium iron phosphate batteries are produced in China.
The IEEFA Energy Analyst Putra Adhiguna states, “The current development of electric vehicles seems to not heavily rely on nickel-based batteries. Whether Indonesian electric vehicles will use nickel remains a question.”
However, there are also experts who hold a different opinion. Jodi Mahardi, the Minister of Maritime Affairs and Investment Coordination for the Coordinating Ministry of Maritime and Investment of Indonesia, stated at the press conference of “International and Indonesian Carbon Capture and Storage (IICCS) Forum 2024” that batteries with nickel elements have greater power and smaller size, offering a better efficiency compared to lithium iron phosphate batteries.
The director from Indonesian Center of Economic and Law Studies (Celios), Bhima Yudhistira also believes that nickel is more suitable for electric vehicles’ batteries, because “nickel have longer battery life compared to other alternatives, such as lithium iron phosphate,” he stated.
