Don’t underestimate lithium-ion battery demand for nickel
The focus on lithium-ion batteries seems to reflect supply and demand of lithium and cobalt and the growth rates of EVs and ESS but it would be very wrong not to include nickel. If EVs are to replace petrol/diesel vehicles, they will require battery packs that can deliver the ranges that drivers are used to.
First-generation EVs relied on lithium-ion batteries that were made using lithium iron phosphate (LFP) and lithium manganese oxide (LMO), neither of which used nickel in their chemistries. Since range anxiety has been a factor putting people off buying EVs, the industry has developed batteries that have higher energy densities and therefore greater ranges. These second-generation lithium-ion batteries have a different chemistry, one that use nickel manganese and cobalt (NMC).
China announced earlier this year changes to its subsidies for EVs; these were aimed at EVs that have greater ranges, which encouraged the use of NMC batteries over LFP and LMO. Although all battery chemistries are still used, new models are likely to be designed around NMC chemistries as and when they are developed. As well as NMC, Tesla uses its own lithium-ion battery, which has yet another chemistry – nickel, cobalt and aluminium (NCA).
Quadruple-positive whammy for nickel demand
Given the need for greater range, we expect most EVs will ultimately use NMC and NCA batteries so more nickel will now be used in EV battery cells. But as well as more EVs now having nickel in the battery cells, two other factors look set to increase the amount of nickel in EVs.
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