ENERGY WATCH #4 - September 18, 2018
EV sales are accelerating – lithium-ion will dominate batteries for long time
by Karel Beckman
Readers who have grown alarmed about the possibility of an early fossil fuel demand peak (LINK TO EPW109-1c) should get more alarmed when they read the latest numbers on EV sales from Bloomberg New Energy Finance (BNEF).
According to the latest figures from Bloomberg New Energy Finance (BNEF), cumulative passenger EV sales have now passed the 4 million mark. The figure includes battery electric passenger vehicles and plug-in hybrid passenger vehicles, but not e-buses.
Some highlights from the BNEF report:
- At the end of June 2018 there were more than 3.5 million passenger EVs sold globally and about 421,000 e-buses, bringing the total cumulative EVs sold to 3.97 million. China played a major role in reaching this milestone, and is responsible for around 37% of passenger EVs sold around the world since 2011 and for about 99% of the e-buses.
- There are several new EV models that we expect to come to the market before the end of 2018, which should help increase sales numbers globally. We also expect the Tesla Model 3 to arrive in Europe in mid-2019, which will likely boost EV sales in the region further. China’s so-called NEV quota kicks in in 2019 and will also push sales forward.
- The next million EVs will take just over 6 months. We expect the five-millionth EV to be sold in March 2019.
- Unsurprisingly, around 42% of those upcoming EV sales will be in China, with Europe contributing 26% and North America 25%. However, if Tesla Model 3 sales continue to accelerate, North America could catch up with Europe quite quickly, with both regions having roughly 1.3 million EVs sold by then.
- The time needed to reach each consecutive million EVs sold is shrinking. The first million, which was reached in 4Q 2015, took around 60 months to achieve. North America and Europe were the largest contributors to that first million, contributing 39% and 33%, respectively. China supplied only 15% of the first million EVs on the road.
- With changes to the support offered to EVs in China, sales have increased dramatically. It took 17 months to get to 2 million EVs sold globally, and 10 months to get to 3 million. By 1Q 2018 – when the three-millionth EV was sold – around 35% of cumulative EV sales globally were in China.
- We estimate it will take just over 6 months to hit 5 million EVs sold. The acceleration aligns with the major markets – China, Europe and North America – approaching or exceeding EVs accounting for a 2% share in new car sales. In 2Q 2018, the share of EVs in new car sales was at 4%, 2.3% and 1.6% in China, Europe and North America, respectively.
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Chances are that most of these EVs will be using lithium-ion batteries, but not necessarily lithium-ion batteries with cobalt in them.
MIT Technology Review reports that he US Department of Energy is launching “a major research effort to develop a new generation of lithium-ion batteries largely free of cobalt, a rare and expensive metal delivered through an increasingly troubling supply chain.”
The three-year program is “part of a broader effort to accelerate advanced vehicle technologies”, notes MIT, “which could eventually lead to cheaper, longer-lasting consumer gadgets, electric cars, and grid storage.”
MIT interview materials scientist Gerd Ceder of Lawrence Berkeley National Lab, who is overseeing one project, aimed at developing “disordered rock salts” as an alternative material for cathodes, which “typically require cobalt to create and retain a layered structure in the electrode, which allows lithium ions to easily flow through it. But several years ago, Ceder and his colleagues found that this new class of materials could store more lithium, potentially boosting energy density while avoiding the need for cobalt entirely (see Disordered materials hold promise for better batteries).”
Ceder, although he is positive that research into alternative battery technologies will bear fruit in the long term, nevertheless believes that lithium-ion will dominate the market for a long time to come – including in grid storage.
“Grid storage is quite the wild card, in my opinion”, he says. “In the short term, I just see that all being lithium-ion. The reason is it’s reliable and you can buy it from reliable vendors today. You can have a philosophical discussion about whether that’s the best form of energy storage for the grid or not. But if you’re PG&E, who are you going to buy from? Startup XYZ, who may not be there in three years, or are you going to buy from LG Chem, CATL, or Samsung? So I’m not excluding that other technologies can penetrate into the grid, but they should not underestimate the competition from the incumbent. The incumbent is always a powerhouse.”
He also notes that “nobody’s actually ever come up with a great way of manufacturing solid-state batteries.”
