Volkswagen-backed Northvolt will develop wood-based batteries for electric vehicles.

This 2007 image shows logs and wood chips near the Stora Enso paper mill in Finland. The firm claims to be “one of the largest private forest owners in the world.”

Suzanne Plunkett | Bloomberg | Getty Images

Northvolt will become a partner Stora Enso to develop batteries that include components made from wood sourced from forests in the Northern Region.

A joint development agreement between the firms will allow them to work together to produce a battery containing an anode made from something called lignin-based hard carbon. The anode is an important part of the battery, along with the cathode and electrolyte.

In a statement Friday, electric vehicle battery makers Northvolt and Stora Enso, which specialize in packaging and paper products among others, described lignin as “a plant-derived polymer found in the cell walls of plants on land.” According to the companies, trees are 20-30% lignin, which acts as a binder.

“The goal is to develop the world’s first industrial battery with [an] the anode is completely obtained from European raw materials,” the companies said.

As a setback, Stora Enso will supply Lignode, a lignin-based anode material. Northvolt will focus on cell design, process development and technology scaling.

The companies said Lignode will come from “sustainably managed forests”. Stora Enso claims it is “one of the largest private forest owners in the world”.

Johanna Hagelberg, Stora Enso’s EVP of Biomaterials, said its lignin-based solid carbon “will provide a strategic supply of anode raw materials to Europe” and will meet “the need for sustainable batteries for applications ranging from mobile devices to stationary energy storage.”

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The attempt to develop battery materials from a range of sources comes at a time when major European economies are making plans to move away from on-road vehicles using diesel and petrol fuels.

The UK wants to stop selling new diesel and petrol cars and vans by 2030. From 2035, all new cars and vans must have zero exhaust emissions. The European Union, from which the UK left on 1 January. 31, 2020 — pursues similar goals.

As the number of electric vehicles on our roads increases, the supply of batteries will become an increasingly important and competitive factor in the automotive sector.

Earlier this year CEO Volvo Cars told CNBC he thought battery power was “is going to be one of the things that will be in short supply in the coming years.”

Sweden-headquartered Northvolt recently announced that its first gigafactory, Northvolt Ett, has begun commercial deliveries to European customers. The firm says it has over $55 billion worth of contracts with companies such as Volvo Cars, bmwas well as Volkswagen.

Gigafactories are businesses that produce batteries for electric vehicles on a large scale. Tesla CEO Elon Musk is widely credited as the originator of the term.

Northvolt recently announced a $1.1 billion funding increase.while a number of investors, including Volkswagen and Goldman Sachs Asset Management, are involved in raising capital.

Electric vehicle sales reached 6.6 million in 2021, according to the International Energy Agency. Electric vehicle sales reached 2 million in the first quarter of 2022, up 75% from the first three months of 2021.