Lithium is a soft, silver-white metal which, under normal conditions is the lightest of all metals and the least dense solid element. It has a wide range of industrial applications including ceramics, lithium-aluminum alloys, lubricants and glass, but the largest global lithium market is its use in the manufacture of lithium-ion batteries. Lithium has the highest energy storage to weight ratio of any mineral.
There is a strong movement to develop electric vehicles and energy storage devices based on lithium-ion battery technology. This movement is being driven automakers and companies requiring energy storage devices for renewable energy installations.
Tesla Gigafactory – Reno, Nevada
In July 2014, Tesla announced the development of a large lithium-ion battery manufacturing facility called the Tesla Gigafactory to meet its expected rise in demand for lithium-ion batteries.
Tesla held a grand opening in July, 2016 of the operational facility, having only three of the final 21 blocks of the Gigafactory built out, or approximately 14% of the final factory size expected by 2020.
The factory started limited production of Powerwalls and Powerpacks in the first quarter of 2016 using battery cells produced elsewhere, and began mass production of cells in January 2017.
Tesla expects that capacity for 2018 is 50 GWh/yr of battery packs and its final capacity upon completion of entire factory is 150 GWh/yr. This would enable Tesla to produce 1,500,000 vehicles per year, significantly up from its current production of approximately 100,000 vehicles per year.
Lithium Demand Growth
It is thought that battery use will drive lithium demand in the future. Even using conservative forecasts overall lithium demand should more than double from present levels through 2025.
Lithium Price Forecasts
It is likely that lithium prices will continue to rise. Lithium has been one of the few commodities to enjoy price appreciation over the last five or six years. Battery grade lithium carbonate and lithium hydroxide should see strong price increases.