Battery industry revenues to surpass $168 billion by 2030

01 May 2022

The battery industry revenues may surpass $168 billion by 2030 but severe global shortages are highly expected from 2025.

The battery industry is set to be one of the most important over the next 10 years. A compound annual growth rate (CAGR) of 14% is anticipated by 2030, mostly driven by lithium-ion battery sales.

However, according to data and analytics company GlobalData, extraction of raw materials will not satisfy soaring demand unless capital markets change course in the face of environmental, social, and governance (ESG) pressures and invest heavily in new mines.

An analyst in the thematic intelligence team, Daniel Clarke, told the media that governments must play a more significant role in incentivising mining, refining, and battery cell production.

The causes for this are two-fold. Firstly, an emerging challenge for the next decade will be whether the natural resources and raw materials extraction such as lithium, cobalt, nickel, and graphite can satisfy the high demand for batteries.

More gigafactories may be declared, but where will all the raw materials come from? Despite being limited, these materials are not rare, and huge investment is required, said Clarke.

Secondly, while much of the world concentrates on today's geopolitical tug of war over energy between Russia and the Western world, a new clean energy geopolitical war is being battled throughout the lithium-ion battery supply chain.

Clarhe told the media that western governments have woken up to their possible weakness versus China, and are heavily and actively incentivising firms to create a regionalised lithium-ion battery supply chain. Lithium is abundant, but significant investment is needed in new hard rock mines to meet robust growing demand.

China has a very strong place in mining, refining, and cell production, with a near-monopoly in different supply chain stages.

China-based battery manufacturer Contemporary Amperex Technology Co Limited (CATL) is part of the 'China Inc master plan' to conquer the highly strategic global battery industry, said analyst Michael Orme.

The government's incentivisation for mining and refining of raw materials is essential to the world fulfilling its climate goals, alongside battery recycling initiatives.

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Also read: Attero Recycling to invest Rs 300 cr in lithium battery capacity

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