Demand for battery metals surges on the back of a global appetite for electric vehicles
At the beginning of 2017, $32,500 (£26,300) would buy you one tonne of cobalt. Today you’d have to fork out $81,000. Since 2016, cobalt’s price has spiked enormously, and it’s all because of batteries.
Cobalt is an essential component of the lithium ion batteries that power our phones and laptops, and which are expected to be a key part of the world’s energy mix. ‘In 2017, we saw demand from the battery sector at 102 GWh, but we expect that to increase to 709 gigawatt hours by 2026,’ says Caspar Rawles, market analyst at Benchmark Minerals Intelligence.
That demand comes from consumer electronics and using batteries as grid storage for renewable energy sources. But by far the biggest driver is electric vehicles, with governments around the world looking to make the switch from petrol and diesel.
In July 2017, the UK announced plans to phase out sales of new petrol and diesel cars by 2040, and the EU is tightening carbon dioxide limits to incentivise a shift to electric vehicles. Meanwhile, India plans to replace its entire car fleet with electric models by 2030.
In California, the official target for electric vehicles is 5 million by 2030. And in China, where electric vehicles are seen as a solution to its smog-ridden cities, subsidies are offered to consumers and a reward system for manufacturers is being introduced.
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