The World Economic Forum (WEF) has described how energy storage, and the batteries that will make this possible on a mass scale, are key to a fourth industrial revolution.
During the annual meeting of the forum in Switzerland, WEF founder Klaus Schwab explained how a blending of “physical, digital and biological spheres” is well underway, igniting the biggest transformation in the way we live our lives in over 150 years.
Lithium-ion batteries – and two predominant cathode chemistries of nickel cobalt aluminium and nickel manganese cobalt – have taken the limelight, however other designs such as vanadium flow, lithium sulphur and lithium air batteries are also coming to the fore.
While to many the components of a fourth industrial revolution may seem a distant reality, it’s a world which raw material suppliers are already having to acclimatize to rapidly with developments in autonomous vehicles, 3D printing, nanotechnology, advanced materials and energy storage.
For example, the price of the battery raw material lithium carbonate jumped another 20% on average in January 2016, after a year of rising prices in 2015 on the back of strong lithium-ion battery demand.
There appears no sign of this price rise turning into a crash, leaving many to ask whether a fundamental shift in demand has occurred.
“The speed of current breakthroughs has no historical precedent”, Schwab noted ahead of the annual meeting of the world’s economic and political leaders two weeks ago.
A lack of historical precedent often fuels pessimism but when not properly accounted for, can lead to the biggest periods of turbulence.
As Nicholas Taleb stated in his 2007 book The Black Swan, “Our human race is affected by a chronic underestimation of the possibility of the future straying from the course initially envisioned”.
With a number of critical and minerals and metals slowly straying from the course of traditional bulk commodities, questions are quickly arising about how suppliers meet this new reality and safeguard against potential disruption to emerging supply chains.
Energy storage: powering the wider economy
While the forum heard how the productivity improvements from new technologies threaten to suppress inflation, boost unemployment and create a widening income gap, energy storage is arguably one of the few emerging industries which promises to empower both the individual and the wider economy both in EVs and, most critically, the utility sector.
The ability to produce efficient and affordable energy storage systems has not only the potential to liberate homes and businesses from their dependency on energy superpowers, but alongside renewable power solutions could provide energy to entire new markets (think rural parts of India, China and Africa to mention a few).
The batteries required for these types of systems are not only exponentially bigger than those we use today, but they are on the brink of commercial uptake with the developments which are underway in China, Japan, South Korea and the U.S.
2016 is unlikely be the year that this exponential growth comes to fruition, nor the year that the industry unifies around a particular energy storage technology, but it will almost certainly be the year that battery producers lay the raw material foundations for their future growth.
How existing and striving producers of these battery raw materials react to this evolution in demand could determine their place not only within an industry, but within a completely new global economic structure.
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