The slow-motion demand for electric vehicles and the ‘sprint’ to generate factories with greater capacity to supply the transition to zero-emission mobility have translated into a reality that few had foreseen, at least in 2023: batteries have reached historic lows. in their prices.
$139 per kWh, according to the latest report published by Bloomberg NEF, the agency’s energy analysis arm. This represented a 14% decrease in its price compared to 2022, when historical highs were reached in the price of lithium.
Now, the critical mineral has lost value – and, with it, the price per kWh. The reason is mainly due to the fact that the main battery manufacturers indicated that they were not reaching the full capacity of their plants, which led them to review their production objectives.
Examples of this, from the side of car manufacturers, are those of Ford, which has paralyzed electrification plans in Almussafes; or those of the Volkswagen Group, which has lowered its profit margin forecasts for 2023.
Looking ahead to the end of the year, it is estimated that the energy storage industry will grow by 53% year-on-year, with a capacity of 950 GWh in 2023. Sales of electric vehicles are also progressing, but not at the desired pace.
However, this growth is underutilized, according to analysts, who also point to further declines in the price of lithium, nickel and cobalt for the next year.
In the world of electric cars, the price fell to $128 per kWh in terms of a weighted average. A cell cost “only” $89 per kWh, which represents 78% of the value of the battery, exceeding the traditional 70%.
This is mainly due to the reduction of construction costs, with architectures such as “cell-to-pack”, in which the cells themselves are part of the external assembly and allows connections to be saved at a modular level.
China continues to occupy a hegemonic position in the battery market, with prices of $126 per kWh, 11% more affordable than in the US and 20% lower than in Europe. In the Asian country, the industry has taken longer to develop and there is greater competition between different manufacturers.
A technology that is increasingly common to find, especially in more affordable models, is lithium-ferrophosphate (LFP), both complete batteries and cells had the lowest prices on average, with 130 and 95 dollars per kWh, respectively. It is the first time in history that a figure less than $100 has been recorded with this chemical composition.
Looking to the future, Bloomberg expects that prices of 133 dollars per kWh will be reached in 2024 and that in 2025, these can be reduced to 113 in 2025 and 80 in 2030.
However, the ambition to locate production in regions such as Europe or the US could be an influence that drives prices up in the future. According to the director of Energy Storage at Bloomberg, Yayoi Sekine“We have to see how industrial incentives and critical materials legislation will impact prices. “These have been on a roller coaster the last few years.”
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