The battery and charging infrastructure market is experiencing rapid growth due to the demand for electric vehicles. However, there are certain challenges and nuances to consider. In this article we will discuss the lithium battery industry and the outlook for the future, drawing on data from the latest reports.
Keys to the market for lithium batteries and electric vehicles
Demand for EV batteries is expected to continue to increase, with shipments in 2021 94% higher than in 2020. EV battery demand is projected to reach 3.486 GWh in 2030, and manufacturers are expected to increase capacity to meet this demand.
However, the price of battery packs is still a challenge. Prices were expected to fall below $100/kWh by 2024, but rising material prices have affected costs.
The adoption of new technologies and battery pack designs, as well as the use of new chemical mixtures, will help to reduce costs in the future.
In terms of battery materials, the supply of lithium, cobalt, manganese and nickel is expected to be limited in the next decade. Investment in new refining facilities and extraction of raw materials will be necessary to meet growing demand.
A significant increase in demand for lithium and nickel is expected, and collaborative approaches between governments, manufacturers, miners and recyclers will be needed to ensure adequate supply.
The expected scenario for 2050 requires huge increases in the supply of raw materials for batteries and beyond.
Without large-scale battery recycling, the cumulative demand for lithium, nickel and cobalt exceeds currently known reserves during this period.
However, with the recycling of batteries, the door is open to building a circular economy by the middle of this century.
What about the necessary charging infrastructure?
In terms of charging infrastructure, it is estimated that a cumulative investment of more than $1 trillion will be needed in EV charging infrastructure over the next 20 years. A rapid expansion of the public charging network will be required to meet the growing EV fleet.
In the mass market for electric vehicles, many drivers are less likely to have the ability to charge their vehicles at home. Instead, they rely more on public charging infrastructure.
As the use of charging infrastructure and average energy delivery capacity increases, the number of electric vehicles per public charging connector also increases.
Currently, there are between 5 and 20 electric vehicles per public charging connector in most markets, but this number is expected to increase to between 30 and 45 in the future.
The installation of fast chargers will be crucial, and is expected to account for 60% of charging infrastructure investment.
An increase in vehicles with bi-directional charging (V2G) capability is also foreseen, which will allow for greater integration of renewable energy and cost reductions in the electricity system.
In summary, the battery market and charging infrastructure are experiencing significant growth due to the increasing demand for electric vehicles.
That said, the challenges related to material prices and the need to rapidly expand the freight network require collaboration between various actors to ensure adequate supply and a robust freight infrastructure.