Lithium Drives EV, Grid Storage as Industry Scrambles To Fill Supply Deficit

Abstract

What fossil fuel was to the industrial revolution, lithium is to today’s energy transition. Often referred to as the oil of the 21st century, this strategic commodity is essential to the manufacture of batteries, from the 35- to 100-kWh type that power electric vehicles (EVs) to grid-size 100-MW (and larger) battery energy storage systems (BESS) such as those at Tesla’s Gambit Energy Storage Park near Houston, whose power capacity is among the highest in the US. Because lithium-ion batteries charge quickly and last longer due to their higher power density, it is not surprising that as the energy transition picks up the pace, the demand for lithium is rapidly outstripping supply, leaving the industry scrambling to find new sources—whether that means opening new mines or devising new technologies to extract lithium from brines, including brines found in water produced from oil and gas operations. In the EV arena, Deloitte forecast a 29% compound annual growth rate in EV sales over this decade, predicting that EVs will comprise 32% of new car sales by 2030 with China commanding 49% of the market, Europe holding 27%, and the US at 14%. The US Environmental Protection Agency attributes 30% of US greenhouse-gas emissions to transportation, a fact that has prompted the automobile industry to shift into transformational mode to make this decade the tipping point when EVs become mainstream. Catching the Vibe at CES In her keynote at the 2022 Consumer Electronics Show (CES) in Las Vegas, Nevada, in January, General Motors CEO Mary Barra announced that in 2023, GM will launch production of its long-anticipated electric Chevrolet Silverado pickup truck, a move made possible by the company’s $35-billion investment strategy announced last summer to compete with Tesla. GM’s investment plan through 2025 targets, among other things, “on lining” four new, US-based lithium-ion cell production plants with a combined cell production capacity of 140 GWh/year, based on the company’s proprietary Ultium platform. Ultium Cells LLC, a joint venture with LG Energy Solution, announced in late January it would build its third plant in Lansing, Michigan. The JV is currently constructing plants in Lordstown, Ohio, and Spring Hill, Tennessee; the location of the fourth plant has yet to be announced. Back in Las Vegas, Sony grabbed headlines at CES by reaffirming it will open its own automobile unit, Sony Mobility Inc., in the spring of 2022, and Chrysler, a part of the Netherland’s Stellanis group, treated CES visitors to a look at its first EV concept car which is planned to launch in 2025. From that standing start, Stellanis said it expects to convert 70% of its European vehicle sales and 40% of its US sales over to the EV category by 2030.