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As a general
rule, the most successful man in life is the man who has the best information
Current global leaders
in advanced electric vehicle batteries are based, for the most part, in Asia.
President Obama
made global warming one of the main planks in his election platform. Included
in his Clean Energy Agenda were pledges to
eliminate oil imports from the Middle East and Venezuela within a decade and
to slash his country’s carbon dioxide emissions by more than 30 per
cent by the year 2020.
I wrote the
following early in 2009;
“Lithium battery technology is absolutely critical to
President Obama’s energy plan. Lithium-ion is the leading battery
technology and a hugely important first step towards transforming electric
cars from a niche curiosity into a major clean energy revolution for the
transportation sector.
Lithium batteries
could be part of the answer to increasingly expensive oil, energy dependence
on foreign suppliers and global warming. Now, with the big push to renewable
energy and far less reliance on fossil fuels, a market is starting to develop
in the United States for more advanced batteries. This, combined with loan
guarantees, will act as an incentive that could very well jumpstart the
advanced battery industry in the US.”
The Obama
administration tagged $1.5 billion of the $2.4 billion in electric technology
development funds for battery manufacturing projects and in a direct response
to the Gulf oil spill asked (late June 2010) Congress for an additional $6
billion.
“I
don’t want to have to import a hybrid car, I want to build a hybrid car
here.” President Obama
Obama has put
taxpayers money where his mouth is - this huge and continuing investment has
placed the US on track towards becoming the globe's major supplier of
advanced batteries for plug-in vehicles. This mountain of taxpayer’s
money has helped to finance 26 of the 30 electric-vehicle battery and
component plants now under construction – this includes nine
lithium-ion battery manufacturing plants of which four are expected to be
producing batteries by year's end.
The US Department
of Energy has said that those 30 factories, by 2012, could have enough
capacity to supply 20 percent of the worlds advanced battery needs and
furthermore that their share of the world market could rise to 40 percent by
2015.
There’s
billions and billions of dollars, courtesy of the government’s stimulus
package, still to come for advanced battery technology R&D companies and
battery manufacturers. The auto industry is gearing up to make its first real
go at marketing plug-in vehicles for the masses. The start flag has dropped
and the race to build lithium-ion batteries for vehicles has started.
The consulting firm Pike Research estimates the global market
for lithium-ion batteries could grow from $877 million in 2010 to $8 billion
by 2015 - they also expect the North American market to expand from $287
million this year to $2.2 billion in 2015.
A March 2010 report issued by Deutsche Bank says “We
continue to believe that the market underestimates the potential for growth
in this segment…..we’ve noted evidence of steeper than-expected
battery price declines which will likely bolster the consumer value
proposition and potentially lead to stronger demand than we originally
envisioned.”
Deutsche Bank’s report also claims automakers are seeing bids for $450
per kwh from battery companies for delivery contracts in the 2011/2012 time
frame. They also predicted an additional 25% decline in price over the next 5
years and a 50% decline over the next 10 years along with a doubling of
performance over the next 7 years.
Conclusion
Electric
vehicles (EVs) have far fewer moving parts than Internal Combustion Engine
(ICE) gasoline-powered cars - they don't have mufflers, gas tanks, catalytic
converters or ignition systems, there’s also never an oil change or
tune-up to worry about getting done. Plug and go, pretty convenient and very
green!
But the clean and green doesn’t end there - electric drives are more
efficient then the drives on ICE powered cars. They are able to convert more
of the available energy to propel the car therefore using less energy to go
the same distance. And applying the brakes converts what was simply wasted
energy in the form of heat to useful energy in the form of electricity to
help recharge the car’s batteries..
The
first DVD players, the first flat panel widescreen TV’s, the first
production runs of any advanced technology are always more expensive than
later unit costs will be. That is a fact, but this author believes that
Hybrid and fully Electric Vehicle prices will soon be very affordable and
offer cost advantages over their polluting gas guzzling ICE second cousins.
But the real story behind all electric vehicles is that they are totally
emission free.
The
rechargeable power needs of our modern society has made lithium a serious
player in the commodity markets. Lithium
miners should be on every investors radar screen.
Are
they on yours?
Richard Mills
Aheadoftheherd.com
Richard is host of www.aheadoftheherd.com and invests in the junior
resource sector. His articles have been published on over 60 websites
including - Wall Street Journal, 24hGold, Kitco, USAToday, Safehaven,
SeekingAlpha, The Gold/Energy Reports, Gold-Eagle and Financial Sense. If
you're interested in learning more about specific junior gold/silver stocks
and the junior resource market in general please come and visit his site at
www.aheadoftheherd.com
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