Nature's ESG Power Player: How Natural Graphite Outshines Synthetic in Lithium-Ion Batteries

G6 Energy Corp
Public and Investor Relations
February 8, 2023
4 Min

Lithium-ion batteries have become the backbone of modern energy storage, powering various devices from smartphones to electric vehicles. Graphite is a crucial component of the anode in these batteries, providing the necessary storage capacity for lithium ions. However, there is a significant distinction between synthetic and natural graphite, both in terms of their production methods and their environmental impact. This article delves into the importance and differences of synthetic and natural graphite in lithium-ion batteries, considering factors such as carbon intensity, pricing, and the evolving market dynamics.

Synthetic Graphite: Origins and Environmental Impact

Synthetic graphite is derived from fossil fuels, such as petroleum coke or coal tar pitch, through a complex high-temperature manufacturing process. This process requires substantial energy inputs, resulting in a higher carbon footprint compared to natural graphite production. Studies suggest that synthetic graphite production is approximately four times more carbon-intensive than natural graphite production, exacerbating concerns about climate change and sustainability.

Natural Graphite: Lower Environmental Impact and Emerging Demand

Natural graphite, on the other hand, is extracted from graphite ore deposits, typically through mining or flake graphite processing. Compared to synthetic graphite, the environmental impact of natural graphite is significantly lower. The mining process, though not without its own challenges, generally has a lesser carbon footprint and is less energy-intensive.

In the context of increasing environmental, social, and governance (ESG) considerations, the demand for low-carbon materials is rising. Battery makers are increasingly recognizing the importance of reducing carbon intensity in the entire supply chain, including the anode materials. As a result, the emphasis is shifting towards natural graphite, which offers a more environmentally friendly alternative to synthetic graphite.

Pricing Dynamics and Market Outlook

The carbon-intensive nature of synthetic graphite production, coupled with potential future carbon pricing mechanisms, creates upward pressure on graphite prices. As the prices of fossil fuels, particularly oil, increase, the cost of producing synthetic graphite also rises. On the other hand, the lower environmental impact and sustainable production methods associated with natural graphite make it a more attractive option for battery manufacturers aiming to meet ESG goals.

According to projections by Benchmark Minerals, the composition of anode materials is expected to undergo significant changes by 2030. The current average mix of 63% synthetic and 35% natural graphite is anticipated to shift to 45% synthetic and 50% natural graphite. This substantial increase in the usage of natural graphite highlights the growing recognition of its advantages and the shifting market dynamics.


The choice between synthetic and natural graphite in lithium-ion batteries is becoming increasingly crucial as the industry aims to address environmental concerns and embrace sustainable practices. Natural graphite, with its lower environmental impact and compatibility with ESG goals, is gaining prominence as an alternative to carbon-intensive synthetic graphite. The projected shift in anode material composition towards a higher proportion of natural graphite reflects this evolving market landscape. By prioritizing the adoption of natural graphite, battery manufacturers can contribute to the development of cleaner, more sustainable energy storage systems for a greener future.