Growing Demand for Lithium ion Batteries Copper Supply deficit looming with existing mines at full capacity China concentrate and scrap imports still rising Grades declining and lack of new projects BHP forecast that by 2035 demand for copper in charging and distribution upgrades will reach 1.2m tonnes. The Future of Copper: 1. Electric Vehicle Demand Drives Copper Demand One in six cars is expected to be electric by 2025. EV technology is heavily reliant on copper, and copper demand for EVs is expected to increase from 185,000 tonnes in 2017, to 1.74 million tonnes in 2027. EV manufacturing requires copper for multiple key components, such as batteries, motors, charging stations, and supporting infrastructures. The more advanced the EV technology becomes, the more copper is required. Internal combustion engines typically use 23 kg of copper, while hybrid electric vehicles (HEVs) use 40 kg of copper, plug-in hybrid electric vehicles (PHEVs) use 60 kg of copper, and battery electric vehicles (BEVs) use 83 kg of copper. 2. The Future is Electric According to the published World Energy Outlook 2017by the International Energy Agency (IEA), growing electrification implies that electricity is going to sectors previously confined to fuels, including vehicles, heating and cooling systems. The global demand for electricity is set to grow as rising incomes enable millions of households to use electrical appliances and cooling systems. Progress in India and Indonesia has been particularly impressive, and in sub-Saharan Africa electrification efforts outpaced population growth for the first time in 2014. Electricity requires a great deal of copper for production, distribution, and transmission. Copper is an excellent electrical conductor and operates well at higher temperatures to help electrical systems connect to the larger grid. 3. Renewable Energy Gains Momentum Global electricity generation from wind and solar was 23 percent in 2015, and thanks to increases in wind- and solar-generating capacity, that number is expected to grow to 30 percent by 2020. A strong appetite for renewable energy sources remains at the global level. From wind turbines to solar panels, copper is a critical component of renewable energy technologies. Wind turbines use copper for grounding wires, power cables, transformers, inverters, lightning protection, and as part of generators and control systems.12 A single wind farm can contain 4–15 million pounds of copper. Copper is also a key component of solar energy systems, increasing the efficiency, reliability, and performance of photovoltaic cells and modules. Copper’s superior electrical and thermal conductivity are vital in the collection, storage, and distribution of solar energy. Cobalt Cobalt alloys form part of the lithium ion battery’s cathode material and is major input metal to rechargeable lithium-ion batteries for EV market which is expected to grow from current 10% to 40% by 2025. Auto makers pledging to stop manufacturing internal combustion engine cars and focus solely on electric vehicles. Global demand for Cobalt expected to exceed 100,000t in 2017 and forecast to increase by more than 30% in the next three years. Cobalt prices have risen 270% to over $80,000/t since early 2016. Use of lithium ion batteries in grid scale energy storage, allowing households or entire communities to store electrical energy (when it is inexpensive) and consume it (when it is expensive), is forecast to grow strongly. Major market for Cobalt is mobile phone and other non EV batteries – currently at around 45% of total Cobalt market. China’s pipeline of planned battery plants is about triple the rest of the world at 130.4 GWh with the rest of the world at around 42.2 GWh (Bloomberg New Energy Finance). China is now the largest market for new energy vehicles (battery, plug in hybrid and fuel cell) at around 777,000 cars (China Association of Automobile Manufacturers). Chinese administration is offering generous incentives for consumers buying non internal combustion engine vehicles and all manufacturers (including European manufacturers) are encouraged to use Chinese made batteries. China’s Contemporary Amperex Technology Ltd (CATL) is planning a $2bn IPO for 10% of the company to value the company at around $20bn to finance building the second largest battery factory in the world (behind Tesla’s Gigafactory in Nevada). Mercedes Benz and Smart cars to offer electric versions of all models by 2022. They are building a global battery network of 6 factories in 3 continents and have announced plans to invest $1bn to build a new EV SUV in the US.