In their report Roskill forecasted the medium term outlook for lithium consumption as strong with a base case overall growth rate at 6.4% per annum to 2025 resulting in a demand of 328,000tpa LCE.
Furthermore, a high case scenario of surging demand for lithium secondary batteries in electric vehicles and stronger global economic growth could result in an average growth rate of 9.3% per annum and a demand in 2025 of 440,300tpa LCE.
More recent studies by Roskill and Benchmark Minerals Intelligence indicate that a more rapid EV penetration driven by government policy will considerably increase lithium demand over these numbers.
Most of the large car manufacturers are launching models that integrate lithium ion battery technology whilst Tesla is aiming to bring electric vehicles to the mass market by lowering costs and entering into battery manufacture with their ‘Gigfactory’ in Nevada which will initially produce 500,000 units per annum. Volkswagen have publicised their intent to have 30% of vehicle production as EV by 2025.
It will invariably take time for leading car manufacturers and society to adopt electric vehicles to a point which will impact the lithium market. However, there is growing concern by governments to take action to reduce global warming and pollution of cities by use of fossil fuels and the adoption of electric vehicles can play a significant role. The market for lithium ion batteries has grown markedly following the adoption by consumer technologies – and car batteries require substantially more lithium to power electric vehicles.
Increased use of lithium ion batteries for heavy duty power storage particularly linked to sources of renewable energy off-grid was also projected by Roskill. The increasing use of lithium-aluminium alloys in aircraft manufacture to lighten weight and improve fuel efficiency has good growth potential.