CarbonScape, a New Zealand-based developer of forestry-derived battery-grade graphite, has entered a strategic investment and partnership with CATL, the world’s largest EV and energy storage battery manufacturer, to accelerate commercial scale-up of its bio-based anode material. The deal gives CATL and co-investor Lochpine Capital a combined 20% shareholding in CarbonScape, along with board representation. CarbonScape’s process converts forestry by-products into battery-grade biographite, offering a regional, lower-carbon alternative to today’s oil-based synthetic graphite supply. The partnership pairs CarbonScape’s technology with CATL’s manufacturing and industrialization experience to push biographite toward gigafactory-scale deployment.
Highlights
- CATL and Lochpine Capital together hold a combined 20% shareholding in CarbonScape, with board representation.
- Battery-grade graphite demand is expected to grow six- to 30-fold by 2040. The EV Report
- Graphite represents up to 50% of a lithium-ion battery cell by volume, with each EV containing roughly 50–100 kg.
- More than 75% of battery graphite today comes from oil-based synthetic feedstock, per CarbonScape.
Why Graphite Is the Bottleneck CATL Wants to Fix
Graphite is the single largest raw material by weight in a lithium-ion battery, with a typical EV containing roughly 50 to 100 kg of it — more than its lithium, nickel and cobalt combined. Despite that scale, supply is concentrated: around 95% of the world’s battery-grade graphite is processed in China, and more than 75% of the graphite used in batteries today is synthetic, made from oil-based feedstocks through an energy-intensive process that CarbonScape says emits an estimated 10 to 35 tonnes of CO2 for every tonne produced.
CarbonScape’s biographite is designed to sidestep both problems at once. The company’s proprietary process converts forestry residues — woodchips and sawdust — into graphite the company says matches the performance of leading synthetic material while carrying a carbon-negative lifecycle footprint.
What CATL Brings to the Partnership
The collaboration is structured around two tracks. On the technical side, CarbonScape and CATL will validate the technology at demonstration scale at CATL facilities and refine the process ahead of full-scale commercial plants. On the financing side, CATL and Lochpine become strategic shareholders, with equity-based incentives tied to successful commercial deployment of the technology.
Ivan Williams, CEO of CarbonScape, said the deal delivers more than funding: “This partnership is about far more than capital. It provides access to CATL’s unparalleled expertise in scaling and mass production, world-class facilities, global market reach, and a clear pathway to gigafactory-scale deployment.” He added that the companies aim to bring commercial biographite production online by the end of the decade.
Oscar Luo, Executive President and Global Head of BD, Licensing & Venture Management at CATL, framed the deal as part of the battery giant’s broader sustainability push, calling CarbonScape’s approach to producing graphite from renewable resources “a true breakthrough in material science.”
Vincent Ledoux-Pedailles, Chief Commercial Officer of CarbonScape, called graphite “the forgotten giant of the battery supply chain” and said the company has built “the only proven pathway to produce battery-grade graphite from forestry residues, at target cost parity with conventional graphite and with a carbon-negative footprint.”
A Push Toward Regional, Lower-Carbon Supply Chains
The timing lines up with a broader shift among automakers and regulators. CarbonScape’s model creates a regional, lower-carbon supply chain that doesn’t depend on oil-based feedstocks or a single processing geography — a pitch aimed squarely at automakers and policymakers seeking low-carbon, locally sourced, cost-competitive anode materials for the US and European supply chain. That pressure isn’t unique to CarbonScape; other suppliers, including Graphite One, have been racing to build out domestic graphite capacity as automakers look to de-risk a supply chain concentrated almost entirely in China.
Blake Niu, Lead Partner at Lochpine Capital, said the firm is “committed to supporting innovative technologies relevant to the global energy transition” and pleased to back CarbonScape “alongside CATL as it advances its technology and commercialisation plans.”
Juuso Konttinen, SVP and Head of Growth Business Unit at Stora Enso — an existing CarbonScape shareholder — said CATL’s investment, combined with Stora Enso’s continued backing, positions CarbonScape to build “an integrated value chain from sustainably managed forests all the way to the batteries powering the energy transition.”
Market Backdrop
The deal arrives against a backdrop of surging graphite demand. Demand for battery-grade graphite is expected to grow six- to 30-times higher by 2040, driven by electric vehicle and energy storage growth, and the market will need substantial new capacity from sustainable, cost-competitive sources to keep pace. For CATL, which has been expanding its own battery and materials portfolio aggressively, the CarbonScape stake adds a lower-carbon anode source to a supply chain strategy that already spans cell chemistry, charging infrastructure, and manufacturing scale.
CarbonScape currently operates a pilot plant in New Zealand and is scaling the technology with CATL ahead of potential commercial deployment in Europe and elsewhere.
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