clean

sustainable

energy

WhY LITHIUM?

“Lithium is the New Gasoline”
Goldman Sachs’ Bob Koort

Hydrocarbons powered the world for over a century. The lithium-ion battery provides a tremendous energy storage capacity relative to size/weight. By having that energy available when we need it, we can capture energy when we don’t need it, storing it efficiently in a usable format, and delivering it at the point of consumption. Wind, tidal, solar, geothermal – all these sources of energy become much more viable now that the issue of storing that energy for as-needed use is solved.  The promise of electric vehicles (EV) is the most visible aspect of the profound changes happening in the world today due to lithium-ion battery technology, but they have application in all aspects of life.

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Lithium shares are on a roll after investment bank Macquarie (ASX: MQG) joined peers in predicting a further increase in prices driven by increasing demand from the electric vehicles (EVs) sector, which is expected to push the market into undersupply.

Analysts at the bank are now forecasting prices to rise by between 30% and 100% over the next four years.

  • EU sounds the alarm on critical raw materials shortages. The EU estimates that to meet its climate neutrality goal, it will need up to 18 times more lithium and five times more cobalt in 2030. The forecasts rise to 60 times more lithium and 15 times more cobalt by 2050. (Reuters)
  • Striving for green recovery, EU adds lithium to critical materials list. (Reuters)
  • BMI – Simon Moores: At present, Benchmark is tracking 211 lithium ion battery megafactories in the pipeline to 2028: 12 are in the US, 156 are in a China and 22 in Europe. (Benchmark Mineral Intelligence – Simon Moores)
  • Nearly 800 kt LCE of additional lithium would need to come online in the next five years as EVs are expected to make up around 40% of passenger car sales by 2030. (Wood Mackenzie)
  • Tesla expects significant (battery) shortages in 2022 and beyond. Tesla’s Nevada lithium plan faces stark obstacles on path to production. (Reuters)

LITHIUM SUPPLY VERSUS ELECTRIC VEHICLE AND BATTERY DEMAND

According to Bloomberg NEF’s Electric Vehicle Outlook, by 2025 EVs will hit 10% of global passenger vehicle sales, rising to 28% in 2030 and 58% in 2040.  But you can’t have electric vehicles without lithium-ion batteries.

At the current projected pace, available hydroxide supply is being outstripped by electric vehicle demand.

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