Panasonic’s EV Battery Factory Will Demand So Much Energy That In Order To Power It a Coal Power Plant Is Required.
Evergy, a utility provider serving eastern Kansas and western Missouri, is bracing for a formidable energy challenge as it prepares to meet the substantial electricity demands of the forthcoming Panasonic electric vehicle (EV) battery factory in De Soto, Kansas. This $4 billion megaproject, unveiled in July 2022, stands as a pivotal component in advancing the Biden administration’s EV ambitions. Nevertheless, the factory’s voracious appetite for energy has triggered concerns, prompting Evergy to explore the possibility of keeping a coal-fired power plant operational to meet the surging demand.
In response to the Panasonic battery plant’s energy needs, Evergy is strategizing to request a rate increase in Kansas, pending approval from state regulators. Documentation submitted by Evergy to the Kansas Corporation Commission (KCC), the regulatory body overseeing utilities, unveils the staggering electricity consumption projected for Panasonic’s sprawling facility, covering nearly 4 million square feet in Johnson County. This demand is anticipated to double that of Evergy’s most substantial existing customer in the state. To accommodate this surge, the plan entails constructing two new substations, enhancing three existing substations, and executing considerable work on 31 miles of transmission lines.
Coal Plant Extension
Additionally, Evergy plans to extend the operation of a coal power plant in Lawrence until at least 2028, postponing its transition to natural gas. This decision has drawn criticism from environmental advocates concerned about its ecological impact. Consequently, there is a prospect that Kansas ratepayers may be called upon to share the financial responsibility of providing power to the Panasonic plant.
The demand is anticipated to double that of Evergy’s most substantial existing customer in the state.
The financial dimension adds intricacy to the equation, considering Panasonic is poised to receive substantial incentives from federal, state, and local sources, potentially amounting to $8 billion. This package includes a discounted electric rate typically offered to economic development projects like the Johnson County battery plant.
In April, Evergy initially unveiled plans to raise rates by 5.9% in specific areas of Kansas, with rates potentially climbing by up to 24.9% in regions encompassing Topeka, Wichita, and sections of Johnson County. The KCC is expected to decide on this rate increase by late December, with ongoing public hearings. Any prospective rate hike tied to Panasonic would be an additional imposition on top of the proposed expansion. While precise details of this increment remain undisclosed, Evergy spokeswoman Gina Penzig indicated that the allocation of costs among customers would be determined during the ongoing proceedings.
Lithium based EV batteries, demand massive minerals and energy – a 15-pound battery consumes around 7,000 pounds of minerals, resulting in higher carbon emissions than traditional vehicles
Infrastructure Challenges
Kayla Messamore, Evergy’s Vice President of Strategy and Long-Term Planning, emphasized the formidable electrical requirements posed by the expansive Panasonic plant. She underscored the urgency of procuring capacity and energy to fulfil the plant’s projected energy usage schedule, with energy needs expected to escalate from 2024 and reach complete load requirements by 2026. When fully operational, the Panasonic plant is anticipated to demand around 200 to 250 megawatts of power, equivalent to that of a small city.
While Panasonic assumes responsibility for a portion of the infrastructure upgrades needed to supply power to the plant, Evergy commits to ensuring the reliability of the power system and is therefore seeking a “special contract rate” through negotiations with Panasonic. This rate would encompass investments associated with the heightened power load, a critical component in maintaining customer reliability.
Environmental Controversy
The construction of Panasonic’s $4 billion battery plant in De Soto has been positioned as a linchpin in the Biden administration’s push for EVs. Nevertheless, it has sparked controversy due to its substantial energy demands and the extended operation of a coal plant in Lawrence. Environmentalists argue that the environmental cost of EV production, driven by energy-intensive manufacturing processes and resource extraction, challenges the perception of EVs as inherently eco-friendly.
Using lithium-ion technology, EV batteries necessitate vast quantities of minerals and energy. The production of a 15-pound lithium-ion battery requires approximately 7,000 pounds of minerals extracted from the earth. Consequently, EV production emits more carbon dioxide than conventional vehicles, necessitating significant mileage to achieve a net reduction in carbon emissions.
Grid Pressure
As the United States witnesses the proliferation of EV-related factories, the pressure on the power grid is poised to intensify. Emily Arthun, CEO of the American Coal Council, shed light on the growing acknowledgement of coal’s pivotal role in supplying baseload power to meet mounting energy demands. Policymakers and regulators are beginning to recognize that emerging green industries command substantial energy requirements, necessitating a reevaluation of the premature shutdown of coal-fired power plants.
Panasonic plant is anticipated to demand around 200 to 250 megawatts of power, equivalent to that of a small city.
Baseload Power Importance
This recognition of the necessity for reliable baseload power extends to accommodating the charging demands of the expanding EV market. While renewables like wind and solar play essential roles, a dependable energy supply requires a solid baseload to ensure grid stability. The transition to cleaner energy sources must factor in the critical role of coal in upholding a resilient power supply.
As EV-related industries continue to expand in the United States, the colossal energy demands they impose on the grid raise questions about energy provision and the sustained operation of coal-fired power plants. The tension between environmental aspirations and the need for dependable energy sources underscores the intricate challenges confronting utility companies and policymakers as they strive to attain a sustainable energy future.
