A Critical Element
Lithium is integral to the realization of decarbonization goals and the sustainable future that is being built around the world. Already omnipresent in consumer electronics, lithium-ion batteries are powering electric vehicles and being used as energy storage for renewables. With demand continuing to increase, the rare earth metal is considered one of the most critical elements to the transition towards a low-carbon economy. As the latest Intergovernmental Panel on Climate Change (IPCC) report explains, the window is rapidly closing to reduce carbon emissions before we begin to face the consequences of a planet warming above 1.5 °C. However, in the face of growing lithium demand, the question has often been asked: is there enough lithium to meet these targets?
Running Out of Lithium
An inability to produce enough lithium would result in severe delays to the roll out and implementation of electric transport and renewable power – as such, it is fair to question whether there is enough of the prized element to meet global needs. The damage caused by traditional lithium mining methods has raised concerns over the sector’s sustainability, and a lack of supply would certainly exacerbate them. However, we are able to put all these concerns to rest.
Global lithium reserves are estimated at over 14 million tons, and (depending on who you ask) the amount of lithium needed to meet current goals is somewhere between 0.5 and 1.3 million tons. In 2021 lithium extraction peaked at an industry record of 100,000 metric tons. These statistics alone can inspire confidence in the lithium industry’s future, but there are many other reasons to feel bullish. Technological breakthroughs in the sector mean that lithium can be extracted more sustainably from brines in addition to increasing yields, while the development of a lithium recycling industry is a foregone conclusion. This ensures that the world will not be in a position to run out of lithium.
Asking the Right Questions
While lithium reserves are not a problem to the immediate and long-term needs for low-carbon mobility and power, there is one question that does not get asked nearly as much: can we meet demand with current infrastructure? “Unfortunately, battery capacity can be built much faster than lithium projects,” Global Lithium president Joe Lowry tells S&P Global, “The lack of investment in lithium capacity over the past five years will extend the supply shortage. Even well-capitalized major lithium companies have struggled to meet their expansion targets.”
Lowry believes that there could be a deficit by 2027 and believes supply projections past this cannot be trusted to be accurate. FastMarkets corroborates Lowry and Global Lithium’s fears, but indicates that supply would collapse by 2026. It is for this reason that countries are seeking to secure domestic lithium supplies – Mexico, Chile, China, the United States and the United Kingdom have all made moves in 2021 and 2022 that indicate an interest in developing their own supply chains.
Lithium Extraction in 2023
Lithium extraction projects are multiplying in 2023, with spodumene (ore-based lithium) mine sites set to open in Australia, Africa, and France. Brine sites in Chile, Argentina and Bolivia are seeing an increase in production, with talks of emerging technologies being adopted to be able to meet rising lithium demands. This follows a year where climate technology funding reached new heights with nearly $3 billion of investments in Q4 2022 alone. Yet, in the United States, domestic lithium supply chains are hampered by regulations and lack of infrastructure – key issues that must be addressed soon if the U.S. is to reach its climate goals.
Supply chains for renewable energy, electric vehicles, and climate-critical technology are a major topic of discussion at the 2023 World Economic Forum in Davos. “A deeper understanding of the risks arising from the imbalance between supply and demand of critical minerals, as well as the implications of these risks, is necessary and certainly a first step towards action,” summarizes Benedikt Sobotka, CEO of the Eurasian Resources Group (ERG), “We already know the importance of the mining and metals sector for the energy transition, but it is still necessary to think about strategies that unite the actions of the different sectors affected by the mineral gaps.”
What is the future of lithium?
From Davos in Switzerland to the brines of South America’s Lithium Triangle, all eyes are on new climate tech capable of bridging the gaps in production and supply of battery minerals. Countries with large deposits such as Australia, Argentina and Bolivia can still be expected to produce for international markets, but there will be a need for major investments and a rapid scaling up of infrastructure to increase extraction activities. What is needed is efficient technology capable of reducing the risks of a bottlenecking of lithium supply from brine to battery – something EnergyX is specializing in.
The sheer amount of battery minerals needed to reach net-zero targets and achieve the sustainable economic system we are transitioning to will require a lot of extraction activity. Considering the environmental footprint of rare earths, lithium, and the other components needed for electric vehicle batteries and energy storage systems, we need to actively find solutions to reduce the impact of the mining industry. As a 2023 report from the Climate and Community Project and University of California-Davis outlines, U.S. demand for lithium alone could have global repercussions unless steps are taken to address sustainability and efficiency issues in the sector.
Climate Technology Solutions
EnergyX LiTAS™ Direct Lithium Extraction (DLE) technology and SoLiS™ batteries are disrupting the market and showcasing the innovation needed to solve the real issues within our industry. Increasing lithium yields, reducing the need for heavy chemicals, metals, and large amounts of water for brine processing while producing lithium at a much faster rate than current methods, LiTAS™ is the future of lithium extraction. This was proven by third-party evaluators in Bolivia, who were able to extract 94% of the lithium in local brines in commercial conditions using LiTAS™. Our next generation of DLE technology will be brine agnostic, meaning it will be capable of processing brines regardless of their concentration and chemical properties – an issue that can limit other technologies.
SoLiS™ meanwhile, is redefining lithium-ion batteries, with initial testing showing it is more durable, charges faster, stores more, and provides more versatility than anything on the market. These batteries will be markedly more efficient and provide new opportunities for electric micro mobility, which is why SoLiS™ will be tested at scale on Mobi LATAM’s fleet of bikes later this year. This is only just a sample of the technology currently being developed in our labs. EnergyX has lodged over 50 patents in just four years of existence and seeks to fix the issues within the lithium industry, and plan to prove it by tackling the supply issues facing the sector.