In 2022, there were 603 gigawatt hours of demand for lithium-ion batteries, almost double the level of the previous year. Supply chains are struggling to keep up. Lithium-ion battery pack prices vary significantly in different regions.
Supply chains are struggling to keep up. Lithium-ion battery pack prices vary significantly in different regions. In China they cost $127 per kWh on average, while in the US and Europe prices are 24 and 33 per cent higher respectively.
Albemarle, the world’s largest lithium producer, expects high prices for the key battery metal to persist for years even as they spark a rush to expand supply. The lithium market crashed between 2018 and 2020 as it was swamped by oversupply and demand was hit after cuts to subsidies for electric vehicles.
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter. The price of lithium-ion batteries rose for the first time in more than a decade this year, with surging raw material costs expected to challenge the car industry’s efforts to turn electric vehicles into a mass-market product.
BloombergNEF’s annual battery price survey finds prices increased by 7% from 2021 to 2022 New York, December 6, 2022 – Rising raw material and battery component prices and soaring inflation have led to the first ever increase in lithium-ion battery pack prices since BloombergNEF (BNEF) began tracking the market in 2010.
While prices for key battery metals like lithium, nickel and cobalt have moderated slightly in recent months, BNEF expects average battery pack prices to remain elevated in 2023 at $152/kWh (in real 2022 dollars).