Research by clean energy newswire Bloomberg New Energy Finance forecasts that global demand for lithium iron phosphate (LFP) which is used in electric car batteries and stationary batteries will grow by over 680% over the course of this decade. It is expected to expand to 633 gigawatt hours by 2030, up from a 2021 base level of 81 GWh.
Given the hard deadlines for the introduction of electric cars in Europe, UK, some US states and China and other global emission reduction targets which are staggered between 2030 and 2050, the five years between 2030 and 2035 will see even more explosive growth leading to a demand increase of 1,220% by 2030 compared with the 2021 level.
This is positive news for clean technology companies like Nano One Materials Corp. [TSX:NANO/FRA:LBMB], the company with a patented process for the production of high-performance cathode materials used in lithium-ion batteries. Lithium iron phosphate are used for stationary storage of electricity, passenger and commercial electric vehicles as well as two- or three-wheeler applications. The value of this market can be measured in tens of billions of dollars.
Nano One chief operations officer Alex Holmes said, “The rise in LFP demand is being driven by automotive OEMs and other markets pushing for a localized and diversified battery supply chain in North America, Europe and India.”
Base and minor metals prices have shot up
Prices for base and minor metals used in EV batteries such as nickel and cobalt have shot up since the start of the conflict in Ukraine as sanctions on Russia disrupted the supply of metals and minerals. In addition, the nickel market recently suffered from a massive squeeze – rising from around $17,000 a tonne to $47,000/t in the space of weeks – when the owner of one of China’s largest stainless steel and nickel companies was caught out with nickel short positions in an upward moving market. Lithium-ion batteries have avoided that type of price volatility as they don’t use either nickel or cobalt.
“LFP is also the safest, longest lasting and most affordable lithium-ion battery chemistry, making it perfect for mass market and industrial applications, leaving nickel and cobalt rich chemistries for high-margin long-range vehicles and consumer electronics,” said Holmes.
The company is planning on building a team of engineers and market specialists in British Columbia and tapping an experienced talent pool in Québec.
Why Nano One stands to benefit
The company received funding from various government programs and the current “Scaling of Advanced Battery Materials Project” is supported by Sustainable Development Technology Canada (SDTC) and the Innovative Clean Energy (ICE) Fund of the Province of British Columbia.
The company has also benefited from the recent additions of Denis Geoffroy as commercialization lead and Dr. Yuan Gao as cathode technology advisor. They both come with decades of cathode manufacturing and leadership know-how, particularly in LFP.