The Lithium Revolution
How the shift to clean energy has opened a window of opportunity for energy metals.
“The Lithium Revolution” infographic presented by: Dajin Resources Commodity investors know that it in recent years, the sector has had a rough ride. Recently, factors such as China’s slowdown have weighed on short-term prices of industrial commodities like fuels and base metals. However, not all of the energy sector has struggled. The rise of clean energy has continued to gain momentum, which could be a boon for energy metals producers and explorers.
Energy Metals
Simply put, energy metals are metals used in the creation or storage of energy. Here are some examples of energy metals needed to make lithium-ion batteries, which are the storage mechanism of choice for many green energy producers: Lithium: Lithium is the main ingredient to lithium-ion batteries – the metal’s ions move back and forth to charge and discharge the battery. Cobalt: Widely used in lithium-ion cathodes Graphite: The most common anode material for lithium-ion batteries. Note: Uranium is also used for nuclear power, and copper is fundamental for creating and transporting energy around the world. However, in this infographic we focus on specialty metals. Electric cars and energy storage for renewable sources have been driving the increases in price and demand for these sectors. Let’s take a look at the specific momentum that has been growing since 2014.
The Momentum
Political and social: 2014
Obama reveals clean energy plan: The push will involve more than $1 billion in government funds to back new clean energy and energy efficiency projects along with funding research and development of new energy technologies. Who were the biggest investors in renewable energy in 2014? China ($83.3 billion), USA ($38.3 billion), and Japan ($35.7 billion)
2015
Volkswagen DieselGate scandal causes uproar, as it becomes clear that millions of the company’s vehicles have cheated emissions tests for years Elon Musk announces a mandate for Tesla Motors to acquire raw materials from the USA when possible. 4,000 people die, each day, of pollution related deaths in China alone. The United States deems lithium as a strategic metal and doesn’t give any statistics of its reserves or production.
Business: 2014
Tesla reveals plans to build $5 Billion Gigafactory in the Southwestern US. Tesla announces Nevada as the site of its already-famous Gigafactory project.
2015
The 1 millionth electric car is built in September 2015. Report surfaces that Apple plans to ship driverless cars by 2019. Google’s self-driving cars reach the milestone of 1 million miles driven autonomously. Tesla takes $800 million in orders for its new home batteries in just two weeks. A TSX-V traded company was the most recent recipient of an off take agreement to supply Tesla with Lithium Hydroxide. Volkswagen’s stock price gets crushed over 30% in the aftermath of DieselGate. FMC recently announced an “across the board 15% increase in price” in all finished lithium products. Lithium Hydroxide rose from $9,500 per ton, up to $10,870. Lithium Carbonate from $6,500 per ton up to $7,475 USD.
General Trends:
Charging stations have increased rapidly around the world. Every major auto manufacture has more than one fully electric car. Some automakers mandate is to have an electric version of every model. The oil price has hit a 6.5 year low, yet electric vehicle sales have held momentum. Lithium battery manufacturing costs are dropping in price while lithium battery technology is getting better. New technology is decreasing the charge time for electric cars. Meanwhile, “miles per charge” is rising, and some cars can even recharge wirelessly. There’s a greater interest in looking after the environment with a continued scare of global warming. Wind and solar storage needed to regulate output of electricity back to the grid. China is a nation now giving priority to EV cars on their highways and parking lots.
Green Shift
The above momentum means energy metals like lithium could continue to buck the general trend of global commodities. So far, the price of lithium has increased steadily since 2011.
on
#1: High Reliability
Nuclear power plants run 24/7 and are the most reliable source of sustainable energy. Nuclear electricity generation remains steady around the clock throughout the day, week, and year. Meanwhile, daily solar generation peaks in the afternoon when electricity demand is usually lower, and wind generation depends on wind speeds.As the use of variable solar and wind power increases globally, nuclear offers a stable and reliable backbone for a clean electricity grid.
#2: Clean Electricity
Nuclear reactors use fission to generate electricity without any greenhouse gas (GHG) emissions.Consequently, nuclear power is the cleanest energy source on a lifecycle basis, measured in CO2-equivalent emissions per gigawatt-hour (GWh) of electricity produced by a power plant over its lifetime. The lifecycle emissions from a typical nuclear power plant are 273 times lower than coal and 163 times lower than natural gas. Furthermore, nuclear is relatively less resource-intensive, allowing for lower supply chain emissions than wind and solar plants.
#3: Stable Affordability
Although nuclear plants can be expensive to build, they are cost-competitive in the long run. Most nuclear plants have an initial lifetime of around 40 years, after which they can continue operating with approved lifetime extensions. Nuclear plants with lifetime extensions are the cheapest sources of electricity in the United States, and 88 of the country’s 92 reactors have received approvals for 20-year extensions. Additionally, according to the World Nuclear Association, nuclear plants are relatively less susceptible to fuel price volatility than natural gas plants, allowing for stable costs of electricity generation.
#4: Energy Efficiency
Nuclear’s high energy return on investment (EROI) exemplifies its exceptional efficiency. EROI measures how many units of energy are returned for every unit invested in building and running a power plant, over its lifetime. According to a 2018 study by Weissbach et al., nuclear’s EROI is 75 units, making it the most efficient energy source by some distance, with hydropower ranking second at 35 units.
#5: Sustainable Innovation
New, advanced reactor designs are bypassing many of the difficulties faced by traditional nuclear plants, making nuclear power more accessible.
Small Modular Reactors (SMRs) are much smaller than conventional reactors and are modular—meaning that their components can be transported and assembled in different locations. Microreactors are smaller than SMRs and are designed to provide electricity in remote and small market areas. They can also serve as backup power sources during emergencies.
These reactor designs offer several advantages, including lower initial capital costs, portability, and increased scalability.
A Nuclear-Powered Future
Nuclear power is making a remarkable comeback as countries work to achieve climate goals and ultimately, a state of energy utopia. Besides the 423 reactors in operation worldwide, another 56 reactors are under construction, and at least 69 more are planned for construction. Some nations, like Japan, have also reversed their attitudes toward nuclear power, embracing it as a clean and reliable energy source for the future. CanAlaska is a leading exploration company in the Athabasca Basin, the Earth’s richest uranium depository. Click here to learn more now. In part 3 of the Road to Energy Utopia series, we explore the unique properties of uranium, the fuel that powers nuclear reactors.
