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The Future of EVs and Lithium ion Batteries

June 11, 2018 0 Comments

As it stands, of the 1 billion cars in the world, 2 million are electric. As costs diminish and governments around the world encourage EV development and adoption to cut down on carbon emissions and urban pollution, the age of electric vehicles could be here sooner than we think.

By 2040, according to Bloomberg, EVs will make up 54 percent of new car sales. The millions of new EVs will “take a big bite” out of oil demand, potentially displacing 8 million barrels daily.

The biggest factor? Lithium ion batteries.

Lithium (“white petroleum”) is becoming the most sought-after mineral in the world, with Jonathan More of Power Metals Corp. calling it the largest commodity boom “in a generation.” According to More, the world will need “mountains of lithium, from all over the world, to satisfy the global hunger for batteries.”

And many lithium ion batteries will be needed for EVs. Major oil companies have estimated the number of EVs on the road hitting 20 million by 2030, and such a number will require 1.2 million tons of batteries – six times the current production levels.

Thanks to tiny and concentrated initial sales, mostly in the luxury market, there were many skeptics when EVs first rolled off assembly lines. In March 2018, however, over 40,000 EVs were sold in Europe, a 41 percent increase from 2017.

European automakers, including Volvo, are wanting to concentrate on EV production, with plans to have EVs make up over 50 percent of total sales by 2025. Porsche set its goal of 50 percent reached by 2023, and American automaker GM and Japanese automaker Toyota have set goals to sell 1 million EVs a year by 2025.

China is set to stay the “real juggernaut” in the global EV market over the next 5-7 years, with half of total EVs in use on its roads. Global EV sales are expected to rise to 1.6 million this year, reaching 2 million by 2019.

According to a report from the Boston Consulting Group, hybrids and EVs are estimated to cut the market share of combustion cars in half by 2030.

Such numbers won’t be possible without lithium ion batteries; there’s a reason Elon Musk built a “gigafactory” in Nevada to manufacture them.

In 2017, the worldwide battery market was at $5.1 billion, and could expand to $58.8 billion by 2024. Battery production costs less money than it used to, but you still need enough lithium to keep up with demand.

Luckily, new lithium deposits are being uncovered: Ontario’s Lake Paterson, the property owned by Power Metals Corp., has thousands of tons of lithium locked away in pegmatite. The company launched an “aggressive” 15,000m drilling program to get at the mineral.

The lake has a “staggering amount of pegmatite dykes” and “huge potential of finding more lithium mineralization,” said PMC’s head geologist Dr. Julie Selway.

PMC, along with other Canadian firms like Nemaska Lithium and Quantum Minerals Corp., “will help feed the world’s lithium demand and facilitate the surge in EVs by the 2020s” alongside South America, Europe, and Australia.

In 2015, EV demand picked up and battery manufacturers bought up all the lithium they could get their hands on, driving up the prices (which hold strong today).

An analysis from August last year predicted the global lithium ion battery market hitting $93 billion by 2025, a 17 percent increase every year. It makes sense; manufacturers will need a lot of lithium to satisfy the demand for lithium batteries.

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