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How low could LFP costs go?

There are countless ways cost reduction can be achieved within gigafactories, ranging from procurement, cell design and local price reductions. Here we explore 3 of them: a reduction in cathode active material (CAM) price due to LFP oversupply, halving of electricity/gas pricing due to local subsidies, and halving the workers required via increased factory optimisation.

Procuring cost-effective CAM is critical to reducing the cost of the cell. In the base case LFP CAM price is $8.5/kg, reducing to $6.2/kg in the optimised case, resulting in savings of almost $5/kWh. Short-term savings to this extent are feasible due to the oversupply of Chinese LFP which suppliers have been attempting to offload at severely discounted prices.

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