Jamie Speirs is based in Imperial College’s Centre for Energy Policy and Technology (ICEPT), where he conducts research on the social, technical and economic issues affecting energy policy in the UK, Europe and globally. His work has included research into global oil depletion, shale gas resources and the availability of critical metals.
Electric vehicles, like many low carbon technologies, use a number of different exotic metals in their design. Many of these metals are considered ‘critical’ in that they are necessary to the development of the electric vehicle market, and yet the availability of sufficient quantities of these metals for future market demands has been questioned.
A number of different types of vehicle design utilise electricity for drive, including hybrids, plug-in hybrids, fuel cell vehicles and battery electric vehicles. Common to these designs are electric motors and batteries, both of which contain critical metals. While a number of competing battery technologies exist, lithium-based battery chemistries are the current batteries of choice for electric vehicle manufacturers and lithium has been raised as a critical metal. Many electric motors use high-powered magnets in their design. These magnets contain neodymium and dysprosium, which are both rare earth elements often cited as critical metals.
Opinion is divided on whether the availability of these metals could become a ‘showstopper’ for the electric vehicle market. While this topic is beset by a number of uncertainties a greater exposition of the important issues for electric vehicle materials can shed some light on these emerging concerns.
First it is important to understand the nature of future demand for electric vehicle materials. A number of scenarios project significant increases in future electric vehicle sales. For example, the International Energy Agency estimates that by 2050 annual sales of battery electric vehicles will reach ~50 million vehicles a year1. These scenarios, and the prospects for future electric vehicle sales, are dependent on climate policies, and the changing nature of our future aspiration to decarbonise is an uncertainty that could significantly affect the electric vehicle market. Nevertheless, projected electric vehicle market growth suggests that future demand for lithium and neodymium could become many times current lithium or neodymium supply2.
The electric vehicle market must also compete for access to critical metals with several other uses. Lithium batteries are increasingly used in consumer electronics, and lithium is also used as an additive to ceramics and glass. In the US these end uses account for 56% of lithium consumption3. Magnets containing neodymium can be found in many consumer products including computer hard drives and audio speakers and headphones. Other metal alloys, magnet uses and use in catalysts represented ~60% of neodymium demand in 20104.
Opportunities exist to reduce the demand for critical metals in electric drive vehicles. Different vehicle designs have different metal requirements and favouring vehicle designs that use less critical metals could mitigate availability constraints for certain metals. For example, battery electric vehicles are likely to have the highest demand for lithium, as they require larger batteries, while fuel cell vehicles may require significantly smaller batteries and therefore less lithium5. However, hydrogen fuel cells require platinum, and switching between vehicles may just be substituting one critical metal for another. Alternatively, substitution within vehicle components may provide similar demand-reducing effects. While permanent magnet motors are widely used in electric vehicle designs, induction motor designs also exist, and do not require neodymium magnets.
When looking at critical metal supply a great deal is expected of producers if they are to keep up with the significant increases expected in demand. Lithium is recovered from mineral deposits and brines found in salt flats. The U.S. Geological Survey (USGS) cites a significant and growing quantity of economically-recoverable reserves, and also a large quantity of resources potentially economic in the future. A range of other reserve and resource estimates indicate that known quantities of lithium appear to be increasing over time2. In contrast neodymium, like many other critical metals, is recovered with a number of other metals, and the economics of its extraction are therefore dependant on these other metals. As a result, producers may not respond to price signals in the way expected in other commodities markets, and a high neodymium price might not be sufficient to encourage increased rare earth metals production4. However, producers can favour rare earth ore that has particularly high concentrations of certain high demand metals to help balance with the priorities of the end use markets.
Geopolitical issues also impact on availability of these metals. For example, China produced over 90% of global rare earth metal in 20136, with some suggestion that the global rare earth market is therefore overexposed to Chinese export policy. However, global reserve endowment is much more balanced, with less than 40% of global reserves thought to exist in China. Rare earth extraction projects in regions outside China will begin to impact on the geographical distribution of rare earth metals production6.
Metal recycling is another way to reduce the burden on mining production. However, the contribution that electric vehicle recycling can make will take some time to realise, as the metal components may be tied up in electric vehicles for many years. Once these vehicles reach the end of their usable lives their metals will become recoverable, but recovery rates will be less than 100%, reducing the impact that recycling can make to annual production5.
Historical production data indicates that production of many critical metals, including lithium and neodymium, is on an increasing trajectory. However, how long into the future these trajectories can be maintained and whether growth will be sufficient for future electric vehicle demand is uncertain. Whether or not the debate over critical metals in electric vehicles is resolvable, there does appear to be a number of mitigating factors that will aid electric vehicle manufacturers in the face of constrained metal supply. On the demand side, several substitution opportunities give manufacturers a way to avoid constrained metal supply chains and the high metal prices that will follow. For supply, the rate of production growth and the growth in estimated reserves and resources holds some optimism for meeting future demand. In addition, recycling can play a part in meeting this future demand.