The Battery Series
Part 4: Critical Ingredients Needed to Fuel the Battery Boom
The Battery Series is a five-part infographic series that explores what investors need to know about modern battery technology, including raw material supply, demand, and future applications.
The Critical Ingredients Needed to Fuel the Battery Boom
We’ve already looked at the evolution of battery technology and how lithium-ion technology will dominate battery market share over the coming years. Part 4 of the Battery Series breaks down the raw materials that will be needed for this battery boom.
Batteries are more powerful and reliable than ever, and costs have come down dramatically over years. As a result, the market for electric vehicles is expected to explode to 20 million plug-in EV sales per year by 2030.
To power these vehicles, millions of new battery packs will need to be built. The lithium-ion battery market is expected to grow at a 21.7% rate annually in terms of the actual energy capacity required. It was 15.9 GWh in 2015, but will be a whopping 93.1 GWh by 2024.
Dissecting the Lithium-Ion
While there are many exciting battery technologies out there, we will focus on the innards of lithium-ion batteries as they are expected to make up the vast majority of the total rechargeable battery market for the near future.
Each lithium-ion cell contains three major parts:
1) Anode (natural or synthetic graphite)
2) Electrolyte (lithium salts
3) Cathode (differing formulations)
While the anode and electrolytes are pretty straightforward as far as lithium-ion technology goes, it is the cathode where most developments are being made.
Lithium isn’t the only metal that goes into the cathode – other metals like cobalt, manganese, aluminum, and nickel are also used in different formulations. Here’s four cathode chemistries, the metal proportions (excluding lithium), and an example of what they are used for:
|Cathode Type||Chemistry||Example Metal Portions||Example Use|
|NCA||LiNiCoAlO2||80% Nickel, 15% Cobalt, 5% Aluminum||Tesla Model S|
|LCO||LiCoO2||100% Cobalt||Apple iPhone|
|LMO||LiMn2O4||100% Manganese||Nissan Leaf|
|NMC||LiNiMnCoO2||Nickel 33.3%, Manganese 33.3%, Cobalt 33.3%||Tesla Powerwall|
|LFP||LiFePO4||100% Iron||Starter batteries|
While manganese and aluminum are important for lithium-ion cathodes, they are also cheaper metals with giant markets. This makes them fairly easy to procure for battery manufacturers.
Lithium, graphite, and cobalt, are all much smaller and less-established markets – and each has supply concerns that remain unanswered:
- South America: The countries in the “Lithium Triangle” host a whopping 75% of the world’s lithium resources: Argentina, Chile, and Bolivia.
- China: 65% of flake graphite is mined in China. With poor environmental and labor practices, China’s graphite industry has been under particular scrutiny – and some mines have even been shut down.
- Indonesia: Price swings of nickel can impact battery makers. In 2014, Indonesia banned exports of nickel, which caused the price to soar nearly 50%.
- DRC: 65% of all cobalt production comes from the DRC, a country that is extremely politically unstable with deeply-rooted corruption.
- North America: Yet, companies such as Tesla have stated that they want to source 100% of raw materials sustainably and ethically from North America. The problem? Only nickel sees significant supply come from the continent.
Cobalt hasn’t been mined in the United States for 40 years, and the country produced zero tonnes of graphite in 2015. There is one lithium operation near the Tesla Gigafactory 1 site but it only produces 1,000 tonnes of lithium hydroxide per year. That’s not nearly enough to fuel a battery boom of this size.
To meet its goal of a 100% North American raw materials supply chain, Tesla needs new resources to be discovered and extracted from the U.S., Canada, or Mexico.
Raw Material Demand
While all sorts of supply questions exist for these energy metals, the demand situation is much more straightforward.
Consumers are demanding more batteries, and each battery is made up of raw materials like cobalt, graphite, and lithium.
Today, about 40% of cobalt is used to make rechargeable batteries. By 2019, it’s expected that 55% of total cobalt demand will go to the cause.
In fact, many analysts see an upcoming bull market in cobalt.
- Battery demand is rising fast
- Production is being cut from the Congo
- A supply deficit is starting to emerge
“In many ways, the cobalt industry has the most fragile supply structure of all battery raw materials.” – Andrew Miller, Benchmark Mineral Intelligence
There is 54kg of graphite in every battery anode of a Tesla Model S (85kWh).
Benchmark Mineral Intelligence forecasts that the battery anode market for graphite (natural and synthetic) will at least triple in size from 80,000 tonnes in 2015 to at least 250,000 tonnes by the end of 2020.
Goldman Sachs estimates that a Tesla Model S with a 70kWh battery uses 63 kilograms of lithium carbonate equivalent (LCE) – more than the amount of lithium in 10,000 cell phones.
Further, for every 1% increase in battery electric vehicle (BEV) market penetration, there is an increase in lithium demand by around 70,000 tonnes LCE/year.
Lithium prices have recently spiked, but they may begin sliding in 2019 if more supply comes online.
The Future of Battery Tech
Sourcing the raw materials for lithium-ion batteries will be critical for our energy mix.
But, the future is also bright for many other battery technologies that could help in solving our most pressing energy issues.
Part 5 of The Battery Series will look at the newest technologies in the battery sector.
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How Affordable is Gas in Latin America?
This graphic looks at gas affordability in Latin America, showing how much a liter of gas costs in 19 countries, relative to average incomes.
How Affordable is Gas in Latin America?
As gas prices have risen around the world, not each region and country is impacted equally.
Globally, the average price for a liter of gas was $1.44 USD on June 13, 2022.
But the actual price at the pump, and how affordable that price is for residents, varies greatly from country to country. This is especially true in Latin America, a region widely regarded as one of the world’s most unequal regions in terms of its income and resource distribution.
Using monthly data from GlobalPetrolPrices.com as of May 2022, this graphic by Latinometrics compares gas affordability in different countries across Latin America.
Gas Affordability in 19 Different Latin American Countries
To measure gas affordability, Latinometrics took the price of a liter of gas in 19 different Latin American countries and territories, and divided those figures by each country’s average daily income, using salary data from Statista.
Out of the 19 regions included in the dataset, Venezuela has the most affordable gas on the list. In Venezuela, a liter of gas is equivalent to roughly 1.3% of the country’s average daily income.
|Country||Gas price as of May 2022 (USD)||% of average daily income|
|🇩🇴 Dominican Republic||$1.41||12.6%|
|🇸🇻 El Salvador||$1.14||9.2%|
|🇨🇷 Costa Rica||$1.42||5.9%|
|🇵🇷 Puerto Rico||$1.35||2.2%|
This isn’t too surprising, as Venezuela is home to the largest share of proven oil reserves in the world. However, it’s worth noting that international sanctions against Venezuelan oil, largely because of political corruption, have hampered the once prosperous sector in the country.
On the other end of the spectrum, Nicaragua has the least affordable gas on the list, with one liter of gas costing 14% of the average daily income in the country.
Historically, the Nicaraguan government has not regulated gas prices in the country, but in light of the current global energy crisis triggered in large part by the Russia-Ukraine conflict, the government has stepped in to help control the situation.
As the Russia-Ukraine conflict continues with no end in sight, it’ll be interesting to see where prices are at in the next few months.
Mapped: Which Ports are Receiving the Most Russian Fossil Fuel Shipments?
Russia’s energy exports have become a hot topic. See which ports received fossil shipments during the first 100 days of the Ukraine invasion
As the invasion of Ukraine wears on, European countries are scrambling to find alternatives to Russian fossil fuels.
In fact, an estimated 93% of Russian oil sales to the EU are due to be eliminated by the end of the year, and many countries have seen their imports of Russian gas plummet. Despite this, Russia earned €93 billion in revenue from fossil fuel exports in the first 100 days of the invasion.
While the bulk of fossil fuels travel through Europe via pipelines, there are still a number marine shipments moving between ports. The maps below, using data from MarineTraffic.com and Datalastic, compiled by the Centre for Research on Energy and Clean Air (CREA), are a look at Russia’s fossil fuel shipments during the first 100 days of the invasion.
Russia’s Crude Oil Shipments
Much of Russia’s marine shipments of crude oil went to the Netherlands and Italy, but crude was also shipped as far away as India and South Korea.
India became a significant importer of Russian crude oil, buying 18% of the country’s exports (up from just 1%). From a big picture perspective, India and China now account for about half of Russia’s marine-based oil exports.
It’s important to note that a broad mix of companies were involved in shipping this oil, with some of the companies tapering their trade activity with Russia over time. Even as shipments begin to shift away from Europe though, European tankers are still doing the majority of the shipping.
Russia’s Liquefied Natural Gas Shipments
Unlike the gas that flows along the many pipeline routes traversing Europe, liquefied natural gas (LNG) is cooled down to a liquid form for ease and safety of transport by sea. Below, we can see that shipments went to a variety of destinations in Europe and Asia.
Fluxys terminals in France and Belgium stand out as the main destinations for Russian LNG deliveries.
Russia’s Oil Product Shipments
For crude oil tankers and LNG tankers, the type of cargo is known. For this dataset, CREA assumed that oil products tankers and oil/chemical tankers were carrying oil products.
Huge ports in Rotterdam and Antwerp, which house major refineries, were the destination for many of these oil products. Some shipments also went to destinations around the Mediterranean as well.
All of the top ports in this category were located within the vicinity of Europe.
Russia’s Coal Shipments
Finally, we look at marine-based coal shipments from Russia. For this category, CREA identified 25 “coal export terminals” within Russian ports. These are specific port locations that are associated with loading coal, so when a vessel takes on cargo at one of these locations, it is assumed that the shipment is a coal shipment.
The European Union has proposed a Russian coal ban that is expected to take effect in August. While this may seem like a slow reaction, it’s one example of how the invasion of Ukraine is throwing large-scale, complex supply chains into disarray.
With such a heavy reliance on Russian fossil fuels, the EU will be have a busy year trying to secure substitute fuels – particularly if the conflict in Ukraine continues to drag on.
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