Perth-based Talga, which develops battery material, revealed its partnership on Tuesday, making it the first Australian firm to join Polestar's effort.
The Polestar 0 project aims to build a vehicle that produces no greenhouse gas emissions in its supply chain, during its production, or at the end of its life, saving tonnes of carbon emissions.
The car brand, which has ties to Volvo, said the project was designed to provide "a full reset" for the automotive industry and prove to other companies it could be done.
Talga will be tasked with researching and developing graphite for the carbon neutral vehicle's battery and managing director Mark Thompson called the challenge inspiring.
"We support our customers in their goal to decarbonise the automotive industry and share their commitment to sustainability," he said.
The Western Australian firm produces a low-emission form of graphite, called Talnode-C, that produces 92 per cent less carbon than synthetic anodes.
Graphite, which is the largest component of an electric vehicle battery, is produced using fossil fuel by-products.
Polestar 0 project lead Hans Pehrson said the companies would collaborate on solutions to remove another source of carbon from the car.
"Partnering with Talga in this research collaboration is an exciting development and another step towards realising Polestar's ambition of developing a climate-neutral car," he said.
"Production of the anode in battery modules is an essential topic for an electric vehicle so our research together with Talga is very important in our effort to eliminate greenhouse gas emissions."
Polestar announced its carbon neutral car project in 2021 and has signed up more than 20 partners to participate in its development.
The company plans to conduct research until 2025, test technology between 2025 and 2027 and produce the vehicle by 2030.
Most of the carbon emissions produced by electric vehicles are created during their production, with a report from consultancy firm Ricardo finding 8.8 tonnes of C02 is created to produce an average EV and nearly half is produced during the production of its battery.
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