The steelmaking staple is set to take off as a new industry hits Australia’s shores.
Vanadium has a long history in steelmaking.
The silver-grey metal is commonly alloyed with iron to make high-strength steel, and its slag by-products have typically acted as a cost-offset for producers.
But the vanadium tide may be turning in a different direction.
As the mining industry gears up to support Australia’s goal of net-zero by 2050, vanadium may offer a unique solution in a future powered by renewables.
China is by far the largest global producer of the metal, with more than 60 per cent of the world’s vanadium produced and consumed on the country’s mainland. The majority of the world’s remaining supply is produced between Russia and South Africa.
But a downturn in China’s construction industry and the resulting slump in demand has seen vanadium quickly becoming known for another reason: batteries.
Vanadium flow batteries (VFBs), sometimes known as vanadium redox flow batteries, are electrolyte baths capable of immediate-release power supply on a large scale. Unlike lithium batteries, VFBs are non-flammable and can be recycled indefinitely.
Australian Mining checked in with two emerging players in Australia’s vanadium landscape: Yadlamalka Energy, which launched the first commercial VFB in Australia in July 2023; and Australian Vanadium, which opened a vanadium electrolyte processing facility in Perth at the start of 2024 and has plans to begin mining vanadium in Western Australia.
Australian Vanadium kicked off with the delivery of a VFB destined for regional service utility provider Horizon Power’s solar power site in Kununurra, WA.
“We’ve been seeing a lot of interest in vanadium ramping up across Australia,” Australian Vanadium chief operating officer Todd Richardson told Australian Mining.
“Vanadium batteries offer an alternative to lithium batteries suited to take on large-scale energy grid storage.”
Shortly after the battery landed, Australian Vanadium opened the doors to its new vanadium electrolyte manufacturing facility in Perth. The facility is set to produce up to 33 megawatt hours of high-purity electrolyte for VFBs per year.
The up-and-comer has now set its sights on the next step in its dream of becoming a vanadium player: mining. There are currently no active mines for the commodity in the country, but Australian Vanadium plans to become the country’s first and largest supplier of vanadium electrolyte from its project in the Murchison region of WA.
The goal is to produce five per cent of the world’s current vanadium supply from the site.
“You can take vanadium from ore all the way through to manufacturing VFBs in Australia fairly easily,” Richardson said. “It’s not as complex as the lithium supply chain, where you have other elements involved like nickel and cobalt.”
Australian Vanadium foresees over half of the world’s vanadium being used in VFBs by the end of the decade.
At the completion of its merger with Technology Metals Australia, Australian Vanadium will consolidate the two company’s extensive orebodies into 15 tenements across 200 square kilometres of vanadium-rich land.
“The next step for us is looking at the best parts of both orebodies and the best parts of the engineering from both sides and combining that into an integrated project,” Richardson said.
“This merger allows us to increase our project life from 25 years to 50 years, which gives us a long runway to be able to supply vanadium both domestically and internationally.
“Our goal is to start from the pit and produce vanadium oxides at our processing facility which can be sold into steel and vanadium electrolyte for batteries.”
While there are no vanadium producers currently operating on Australian soil, Richardson said there are several companies in various stages of development poised to take off in the sector.
“There’s about one billion tonnes of JORC (joint ore reserve committee) compliant reserve and resource in the mid-west of WA alone,” he said. “Australia is second only to China in vanadium resources.”
Australia’s history of mining vanadium for steelmaking petered out by the turn of the century, but Richardson sees a strong future in batteries.
“I think the reason mining vanadium wasn’t successful in the past was because it was dependent upon steel production around the world, which means the commodity price for vanadium fluctuated quite a bit,” he said.
“And there were a lot of times when the production prices for vanadium were below the cost to produce vanadium here in Australia.
“Vanadium batteries are not tied to the steel industry, they’re tied to energy storage, which means that the vanadium prices should not fluctuate as they did in the past. That’s where the future of vanadium is.”
Another company with an eye on the needs on the growing renewables sector is Yadlamalka Energy. The renewable technology solutions manufacturer launched Australia’s first commercial VFB in July last year.
The breakthrough battery was established as part of the company’s Spencer Energy project at the Bungama sub-station in Port Pirie, South Australia.
The project saw the battery connected to a grid of solar panels and charged with the excess electricity they produce. Under cloud cover or when the sun goes down, Yadlamalka’s VFBs power up.
“VFBs offer a number of important advantages,” Yadlamalka Energy founder and managing director Andrew Doman told Australian Mining. “Most importantly, the amount of power that you can produce from them does not deteriorate significantly over time.
“Over 25 years later, you can expect the batteries to be just as effective as they were on day one.”
Doman suggested the current needs of Australia’s energy grid are primed for the kind of coverage VFBs have to offer. When energy sources like solar and wind are less effective, vanadium can fill in the gaps in electricity coverage.
“We have identified in our modelling a four-hour time slot in the evenings when the sun has gone down and there’s a high demand for support to the grid,” Doman said.
“That’s where VFBs come into their own.”
When demand dips during the day and supply outstrips the needs for the grid, energy prices enter the negative. That’s when Doman said Yadlamalka can strike.
“When electricity prices are negative, we’ll be buying the electricity and that will help stabilise the grid, and when prices are high, we’ll be selling power into the grid,” he said. “That margin will have the effect of reducing prices.”
Stability is key as Australia’s energy consumption increases. Doman is confident VFBs are up to the task of keeping the lights on should Australia’s power needs change.
“Adding duration is quite easy with vanadium batteries,” he said. “The batteries are basically two bathtubs with vanadium electrolyte in them, and if you want to increase the duration of the battery, all you do is just add more electrolyte.”
Doman said Yadlamalka is looking to the future of mining in Australia, where reliable power is needed in some of the most remote areas of the country.
“Vanadium overcomes a medium-duration storage problem,” he said. “These are the ideal batteries for those sorts of applications where you’ve got fairly reliable sun and wind, but you need back-up in the hours when the sun goes down and the wind dies out.”
Vanadium offers a reliable solution to sites looking to decrease their carbon footprints while ensuring operations continue around the clock.
Yadlamalka worked with UK-based energy systems company Invinity to establish its Spencer project in SA, sourcing its vanadium from overseas suppliers.
Yadlamalka is now breaking ground on a new project north of Port Augusta, SA, as it turns to sourcing vanadium on home soil – an area where Australian Vanadium is leading the charge.
“Australia is set to become a major producer of vanadium,” Doman said. “It’s worth reminding ourselves that this technology was invented in Australia in the 1970s – it’s homegrown technology. We will be using Australian vanadium.”
Not only suitable to supply energy to the grid and to remote mining projects, VFBs show promise after the battery completes its life cycle.
“Vanadium electrolyte is a fluid which is 100 per cent recyclable,” Doman said. “At the end of the life of the battery, you simply suck out the vanadium electrolyte and resell it or it can be converted back into vanadium.”
It’s that ability to indefinitely fill in the gaps in renewable power that makes VFBs attractive for investment. Australian Vanadium welcomed a $49 million Modern Manufacturing Initiative grant from the Australian Government last year for its vanadium projects.
In addition, the Queensland Government invested $75 million in the Queensland Resources Common User Facility in Townsville in early 2023 for the development of VFBs.
“These batteries will be made in Queensland, right here in Townsville, and will change the game for renewable energy storage,” then Queensland Premier Annastacia Palaszczuk said.
Critical minerals developer Vecco Group produces nine megalitres of vanadium electrolyte at the facility per year, with plans to expand as demand increases.
Other states are currently offering millions to companies developing energy generation and storage projects. SA, where Yadlamalka has seen such success, has taken up the challenge with more than $20 billion in large-scale energy storage projects in the investment pipeline.
With such a swell of support rising behind a home-grown vanadium boom, more and more companies are taking up the mantle.
Now, more than ever, Australia is relying on the mining industry to supply essential minerals and metals to achieve its decarbonisation goals.
Vanadium is poised to establish itself as a strong foundation in that future.
This feature appeared in the March 2024 issue of Australian Mining.
