Why is the Novonix share price jumping 13% today?

Why is this beaten down battery materials share jumping today?

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The Novonix Ltd (ASX: NVX) share price is rebounding from yesterday's heavy decline.

In morning trade, the battery materials and technology company's shares are up 13% to 82 cents.

Why is the Novonix share price rebounding?

Investors have been buying the company's shares this morning after it released the results of an engineering study on its proprietary all-dry, zero-waste cathode synthesis process.

The company notes that the cathode active materials market is projected to be greater than $100 billion in 2030. As a result, the opportunity to deploy this new process to the battery industry could be significant if the results are positive.

The good news is that the global engineering consultancy firm, Hatch, has evaluated the process and given it the thumbs up.

According to the release, the Hatch study found that Novonix's process may potentially reduce power consumption by an estimated 25% and practically eliminate waste by-product generation over the conventional process.

These factors contributed to a potential processing cost reduction of an estimated 50% (excluding material feedstock costs) and potentially lower capital costs by an estimated 30%.

Furthermore, based on the scoping study comparing processes, Novonix's process is estimated to consume fewer natural resources, likely requiring essentially no reagents, and generating fewer waste streams. As a result, it is likely to be a more environmentally friendly and sustainable process than the conventional process.

Significant opportunity

Novonix CEO, Dr. Chris Burns, commented:

Hatch's study supports our expected outcomes of our all-dry, zero-waste cathode synthesis process, which shows the potential for significant cost reductions and environmental benefits. The cathode active materials market is projected to be greater than $100 billion in 2030 and the opportunity to deploy this new process to the battery industry is significant.

Importantly, NOVONIX's process is aligned with our mission of providing revolutionary clean energy solutions to the battery industry and further extends our competitive strengths in battery materials. Several potential customers and partners have already shown significant interest and this study validates the operating and capital cost savings achievable with our novel cathode synthesis process.

The Novonix share price remains down 64% over the last 12 months.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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