Will electric cars ignite a lithium boom?

Some suggest the lithium supply could eventually be tighter than oil is today

Will electric cars ignite a lithium boom?During last year’s American presidential campaign, John McCain laid out his plan to jump-start the electric car industry with a US$300-million reward for whomever could build a better battery. His then rival, Barack Obama, roundly mocked the scheme, calling it a “gimmick.” But it turns out that Obama’s biggest problem with the plan may have been there weren’t enough zeros in the prize.

Any day now, the U.S. Department of Energy is expected to announce the winning recipients of grants to foster a domestic automotive battery industry, and this time the pot is worth US$2.4-billion. Washington has already handed out US$8 billion in loans to Ford, Tesla and Nissan to promote cleaner vehicles—which the latter plans to tap to build an automotive battery plant in Tennessee. And just last week Ontario jumped in to pledge incentives of as much as $10,000 per car to lure drivers into buying electrics.

With such vast sums sloshing around, it’s no surprise that companies and investors are rubbing their hands over the prospect of a boom in the market for lithium. This unique metal, so soft you can cut it with a knife and so reactive it can become explosive when it comes in contact with water, is a key ingredient in the next generation of car batteries, and as plug-in hybrids and electric cars hit the mass market, some are wondering where all that lithium will come from. “There have been a lot of worries out there that all this money that is being spent on lithium-ion battery technology is going to create shortages,” says Jacob Grose, an analyst at Lux Research. In other words, if the fear now is Peak Oil, could the crisis next decade be Peak Lithium?

Lithium-ion batteries are far from new. For two decades they’ve increasingly found their way into iPods and laptops, which now account for 20 per cent of the lithium market. (The rest goes to ceramics, glass and pharmaceuticals.) For the same reasons gadget-makers use them—lithium-ion batteries are lighter than other types, and kick out twice the power—more and more car companies plan to put them into their plug-in hybrids and electric cars.

Along with the environmental benefits, a key driver in this push is to reduce the West’s dependence on Middle East oil. But it turns out that with lithium-ion batteries, the U.S. will still be forced to rely on foreigners. China is a major source of the mineral, as are Chile and Argentina, where it is extracted from brine pools. The world’s largest undeveloped lithium deposit is located in Bolivia, which has already indicated it won’t let foreign companies mine its reserves, and that could be a problem. Bolivia is hardly a friend to the U.S.—the government of President Evo Morales recently accused America’s ambassador of trying to break up the country and expelled him. In a report to Congress last month, the U.S. Government Accountability Office warned that by switching from gas-powered cars to lithium battery cars the U.S. could simply “substitute reliance on one foreign resource for another.”

This could be a major concern if supplies become strained—and some say they will be as electric cars catch on. Obama aims to have one million electric cars on U.S. roads by 2015, while JPMorgan predicts hybrid sales will reach 9.6 million three years later. Japanese carmaker Mitsubishi has said demand for electric cars could surpass supply by 2015, and a commonly-cited 2006 report by William Tahil of Meridian International Research, entitled The Trouble With Lithium, suggests the lithium supply could eventually be tighter than oil is today.

However, others question such predictions. For one thing, though Tahil’s report is repeatedly referenced in news reports, there are good reasons to be suspicious of its contents. An earlier study by Tahil on the 9/11 terrorist attacks offered “incontrovertible proof” the towers were destroyed by “nuclear explosions.” Even ignoring Tahil’s bizarre research history, his report assumes virtually every car sold each year—all 60 million of them—will be electric.

“People who argue we’ll have peak lithium make huge assumptions about the size of the market,” says Kent Furst, an analyst at the Freedonia Group. The U.S. Geological Survey’s lithium analyst, Brian Jaskula, agrees. Should electric cars become wildly popular, he says, there is still enough supply to meet demand for the next decade. That doesn’t include the lithium in Bolivia, a large Nevada lithium mine proposed by Vancouver-based Western Lithium, or potential deposits in Canada.

Besides, while engines constantly consume oil, a lithium battery can power a car for years. If lithium supplies do become an issue some day, by then other battery technologies may have taken over, says Bob Kruse, a executive with GM’s clean energy vehicle program. While the Chevy Volt electric car debuts next year, the company is already working on the second- and third-generations of the car, testing other types of batteries. “I don’t think we’re in danger of running out of lithium any time soon,” he says.




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Will electric cars ignite a lithium boom?

  1. The billions of dollars world wide currently pledged for production and research on Lithium ion batteries implies that there is an abundance of low cost lithium. Even though lithium shows great promise of two to ten times its current energy density there are other competitors with promising potential. We are at the front end of an amazing transformation of land, sea and air transportation. This is bigger than the industrial revolution.

  2. you said it… and I am reorganizing my stock portfolio accordingly, dumped all my tech and retail and bought some abat – lithium batteries and zaap – electric vehicles. it's gonna be a wild ride!

  3. "could the crisis next decade be Peak Lithium?"

    Yes.

    All nonrenewable resources follow the same bell shaped discovery, extraction, consumption and depletion curve. Its called Hubberts Peak.

    As oil and other nonrenewable resources decline, global economies and populations must too. We've just barely entered a period of contraction that will eventually see the global population decline to somewhere around a billion people. No idea what that means economically but I doubt it is what we would currently call good.

    • We can completely skip non-renewable resources and go right to a renewable energy economy, and we can do so within a few years of getting started. The trouble is not that there is no political will to do so, but that big money interests refuse to let go of their profits in their existing markets.

      If you were to take the time to find out the best possible solution (see: http://JackHerer.com for more and very detailed information on this) you would quickly see that the solutions to the vast majority of the world's problems has not only existed, but was known for millennia, and has deliberately been removed from possibility of use by making the solution illegal and keeping the public ignorant of the truth.

      We need to look at REAL renewable resources that have worked very well in the past, and which can be pressed into service to clean the environment while restoring the global energy supply in a decentralized and non-corporate-controlled manner.

      Lack of political will and corporate profiteering be damned…it's time that The People got off their collective lard reservoirs and did something about it themselves!

    • Actually all non-renewable resources do not follow the same curve. One of the chief criticisms of the USGS estimates for vast oil resources that would defer peaking for several more decades is that they were made by mineral geologists who didn't appreciate the differences between oil resources and other mineral resources.

      Minerals typically follow a distribution curve in which the amount of resource in ores at a given concentration level increases exponentially with decreasing concentration. In the case of lithium, moving from the high grade ores found in places like Bolivia to "ores" whose supply is, for all practical purposes, unlimited is not even very difficult. There is a huge amount of lithium in sea water. In fact, the high grade lithium ores, as I understand it, are nothing but old salt deposits. Possibly there's been some leaching process which has preferentially concentrated the lithium salts over the usual sodium, potassium, calcium, and magnesium salts in sea water, but it's still very feasible to obtain lithium from sea water. The price wouldn't even be much higher than it is now.

      • Also I imagine that eventually there will be a lithium battery recycling industry returning old lithium back to the supply side and this would also ensure lithium didn't follow the clasic depletion curve.

  4. Lithium won't run out, just in the same way that oil won't run out, what is more worrying is the amount of energy that will be used to extract lithium in the future once all the easy to reach lithium has been exhausted. Also on the idea of substitutes – most of the main resource contenders to take over from lithium are even more sparse than lithium. Perhaps we will have electric powered shuttles soon to mine the asteroid belts for resources.. makes about as much sense as going electrical does today.

    If a news reader one more time calls electricity 'a fuel'…

  5. "If a news reader one more time calls electricity 'a fuel'… "

    Kind of like how in BC and Ontario electricity is called Hydro even though Ontario has nuclear power and one of the worst coal plants in NA. Calling electricity Hydro doesn't respect where it came from.

    • In BC the name is appropriate. 90% of BC Hydro's power generation comes from hydro-electrics.

  6. While I'm glad that there won't be any new nuclear reactors for the forseeable future (with the 240,000 year half-life of radiactive waste, and the obvious costs to store anything for that length of time) I think that there are better alternatives than trashing the entire established auto industry for no other reason than that there is a need for a better, less toxic source of fuel to run those engines on.

    ALL engines were once made to run with whatever fuel was available, and all farmers grew whatever they needed to run their engines.

    We need to return to the roots of the auto industry to give ourselves a change at a future auto industry. I've been saying it for 30 years…maybe now someone will listen?

  7. While I'm glad that there won't be any new nuclear reactors for the forseeable future (with the 240,000 year half-life of radiactive waste, and the obvious costs to store anything for that length of time) I think that there are better alternatives than trashing the entire established auto industry for no other reason than that there is a need for a better, less toxic source of fuel to run those engines on.

    ALL engines were once made to run with whatever fuel was available, and all farmers grew whatever they needed to run their engines.

    We need to return to the roots of the auto industry to give ourselves a change at a future auto industry. I've been saying it for 30 years…maybe now someone will listen?

    To be blunt, we no longer need oil as a fuel source, but first we need to recognize this fact for what it is, and start moving in an intelligent direction.

    Note: Henry Ford built a car with hemp-plastic body panels that ran on hemp oil, and now Lotus has done the same, in the Eco-Elise. How long will it be before the rest of the industry catches up to Henry Ford's century-old idea?

  8. While I'm glad that there won't be any new nuclear reactors for the forseeable future (with the 240,000 year half-life of radiactive waste, and the obvious costs to store anything for that length of time) I think that there are better alternatives than trashing the entire established auto industry for no other reason than that there is a need for a better, less toxic source of fuel to run those engines on.

    ALL engines were once made to run with whatever fuel was available, and all farmers grew whatever they needed to run their engines.

    We need to return to the roots of the auto industry to give ourselves a change at a future auto industry. I've been saying it for 30 years…maybe now someone will listen?

    To be blunt, we no longer need oil as a fuel source (nor did we ever, technically), but first we need to recognize this fact for what it is, and start moving in an intelligent direction.

    Note: Henry Ford built a car with hemp-plastic body panels that ran on hemp oil, and now Lotus has done the same, in the Eco-Elise. How long will it be before the rest of the industry catches up to Henry Ford's century-old idea?

    • Do you have a good link that gives some detail about the amount of nuclear waste created in a typical Ontario nuclear reactor. I would also be interested to know exactly what it is in nuclear waste that makes it so dangerous to handle for so many years.

      • The total radioactive waste inventory for Canada figures for up to 1998 are in this report.
        A quote;

        In 1998, the 14 operating power reactors produced 78,138 bundles of nuclear fuel waste. This
        represents approximately 313 m3 of waste based on a volume of 0.004 m3 for a typical CANDU
        fuel bundle. The accumulated nuclear fuel waste inventory to the end of 1998 for the power
        reactors was 1,347,141 bundles or approximately 5,389 m3 of waste.

        Here is a document on the toxicity of nuclear waste over time.
        And a Wiki on High Level Radioactive waste.
        And a <a href="http://www.google.ca/search?hl=en&rlz=1C1GGLS_enCA315CA316&q=candu+nuclear+waste+&btnG=Search&meta="&gt; Googleful of Candu nuclear waste.

        Not impossible technical challenges but I fear we lack the political wisdom to do it right.

      • The total radioactive waste inventory for Canada figures for up to 1998 are in this report.
        A quote;

        In 1998, the 14 operating power reactors produced 78,138 bundles of nuclear fuel waste. This
        represents approximately 313 m3 of waste based on a volume of 0.004 m3 for a typical CANDU
        fuel bundle. The accumulated nuclear fuel waste inventory to the end of 1998 for the power
        reactors was 1,347,141 bundles or approximately 5,389 m3 of waste.

        Here is a document on the toxicity of nuclear waste over time.
        And a Wiki on High Level Radioactive waste.
        And a &lt;a href="http://www.google.ca/search?hl=en&rlz=1C1GGLS_enCA315CA316&q=candu+nuclear+waste+&btnG=Search&meta=&quot; Googleful of Candu nuclear waste.

        Not impossible technical challenges but I fear we lack the political wisdom to do it right.

      • The total radioactive waste inventory for Canada figures for up to 1998 are in this report(1 MB .pdf).
        A quote;

        In 1998, the 14 operating power reactors produced 78,138 bundles of nuclear fuel waste. This
        represents approximately 313 m3 of waste based on a volume of 0.004 m3 for a typical CANDU
        fuel bundle. The accumulated nuclear fuel waste inventory to the end of 1998 for the power
        reactors was 1,347,141 bundles or approximately 5,389 m3 of waste.

        Here is a document on the toxicity of nuclear waste over time.
        And a Wiki on High Level Radioactive waste.

        Not impossible technical challenges but I fear we lack the political wisdom to do it right.

  9. An amazing number of stories on the net about this recently. Experts say no shortage likely , however this does not deter the press from helping inflate another commodity bubble similar to the Palladium bubble after the cold fusion frenzy of the late '80s early '90s.
    I suspect a lot of commodities traders have a stake in Lithium and just want to make a quick buck.

  10. I am one who is not convinced the full electric cars are the solution. The effect this may have on the energy consumption and over load to the grid it going to cause long term issues and restriction to using power to charge the vehicle. I too like the concept of building vehicles to use whatever fuel source is locally available. This may then real revolutionize travel.

  11. Maybe that’s the solution but it depends on the car itself. Quality is the good basis.

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