⭐️ Lithium’s satisfying over expansion
There was never going to be a shortage. And there isn’t.
A couple of years ago, concerns about lithium scarcity and skyrocketing prices dominated the conversation around the clean energy transition. Many wondered how we would secure enough lithium to power the growing demand for electric vehicles and energy storage. Fast forward to the beginning of 2024, and the landscape has shifted dramatically. Prices of lithium-ion batteries are plummeting and may drop by as much as 50% this year. The industry now faces a significant overcapacity in lithium battery production. This overcapacity has been matched by oversupply and low prices of lithium ores. (Prices are 80% off their 2022 peak.)
The numbers are staggering: 7.9 terawatt hours of battery manufacturing capacity has been announced by the end of 2025, according to Bloomberg. The firm estimates demand of 1.6 TWh for that year, a number which will prove far too low. Another analyst, IHS Markit forecast total plant capacity for batteries a tad over 3TWh for 2025. Looks like they will be off by 163…