As the price of lithium has skyrocketed over 400% in the past year, the demand for lithium-ion batteries appears more intense than ever. Lithium has earned the ‘white petroleum’ label due to its dramatic need for supplies from the rise of battery giga-factories, electric vehicles, powerwalls and energy storage businesses.
Battery makers including Tesla, Panasonic and LG Chem, have to budget for the rising cost of lithium. Batteries that go into electric cars require lithium. More battery makers will need to expand production to keep up with demand from electric cars.
“The demand for lithium-ion batteries is higher than ever,” said Chris Berry, President and strategic metal consultant at House Mountain Partners. “Lithium’s lightness helps it store a lot of energy which is very useful for electronics.” As the price has jumped to nearly $50,000 per ton, some battery manufacturers have raised prices.
Despite microchip shortages and changing demand from customers, the clean energy revolution appears well underway. Volvo Cars committed to putting one million electrified cars on the road by 2025. In addition, 50% of its sales volume will come from fully electric vehicles. France plans to end sales of all gas and diesel cars by 2040. Whereas Germany has mandated that all new cars will go electric by 2030.
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