Lithium News

According to the latest Bloomberg New Energy Finance’s forecast – New Energy Outlook 2018 – falling battery prices will significantly affect the energy market.

It’s estimated that lithium-ion battery prices decreased by 80% between 2010 and now. That was a major force behind the progress in the electric vehicle market, but it will also pull solar and wind generation.

BNEF predicts that by 2050, 50% of electricity is to be generated by wind and solar. Batteries will be key to solve issues of variable power output from renewables and will open the way for broader adoption. Power will be more often produced closer to where there’s demand (like solar on the roofs of factories or homes).

The report predicts up to $548 billion will be invested in battery energy storage systems by 2050 – two thirds at the grid level and the rest by households and businesses.

“Wind and solar are set to surge to almost “50 by 50” – 50% of world generation by 2050 – on the back of precipitous reductions in cost, and the advent of cheaper and cheaper batteries that will enable electricity to be stored and discharged to meet shifts in demand and supply. Coal shrinks to just 11% of global electricity generation by 2050.”

The electric vehicle market, ESS, solar and wind electricity generation markets all will expand in parallel thanks to more affordable batteries.

It’s also important to note that there is a fundamental synergy between plug-ins, ESS and renewable electricity. EVs needs to be powered from renewable electricity to unleash full environmental potential, renewables need energy storage and local consumption. For example, UPS London expanded its fleet of 65 electric delivery trucks to 170 without an expensive upgrade to the power supply grid, because of utilization of smart grid management and energy storage system. The battery gives flexibility that allows more solar or wind electricity into the mix.

The Indian Government has signalled its intention to launch the largest tender for new solar power capacity in the world.

Power Minister R K Singh told an event in New Delhi this week that the government plans to launch an unprecedented bid for 100,000 megawatts (MW) of new clean energy.

“The biggest tender was floated in Spain. We brought out a single tender of 10,000 MW which would be opened in July. Now we will bring out a bid of one lakh MW which would also include solar manufacturing and storage,” he told the event, according to The Economic Times. One lakh represents 100,000 units.

The 100,000MW tender, or 100 gigawatts (GW), would far exceed anything that has ever been constructed, although the minister didn’t provide exact timings for the project.

Saudi Arabia has announced similar plans to build a $200 billion solar project, with the first phase coming in at 7.2GW.

Mr Singh also told the audience that India has already brought forward 70 GW of renewable energy capacity, and has another 12.5 GW in development.

The minister has previously spoken of his confidence that India would surpass its target to build 175 gigawatts of renewable energy “well before 2022”.

It’s clear that India has started to accelerate its renewable energy ambitions in response to climate change and air pollution concerns. Last month it approved a 5,000 megawatt solar farm in the state of Gujarat, which will become one of the largest in the world. It has also adopted new targets this week to greatly increase the amount of offshore wind in the country.

A World Health Organisation report ranked India as having some of the most dangerously polluted cities in the world, something which hasn’t gone unnoticed within the government.

Samsung Electronics focused on solid-state batteries as the next generation of lithium-ion batteries at an open forum on related technologies, it said Friday.

The South Korean tech titan held the event to keep track of the latest progress in development of the new batteries and share industry cases. The forum held at Seoul National University was attended by renowned experts, including professor Lee Se-hee of the University of Colorado and Yukinari Kotani, executive vice president of the Toyota Research Institute.

Solid-state batteries are expected to replace the lithium-ion batteries currently used in most smartphones and electric cars. As the batteries are made of solid electrolytes instead of liquid electrolytes, they have a significantly lower risk of ignition or explosion. A battery usually explodes when the liquid inside flows out and comes into contact with air or water outside.

Samsung Electronics’ affiliate Samsung SDI and other battery makers are conducting research and development projects on the new batteries.

“High interfacial resistance, a well-known problem of solid-state batteries, could be addressed with new coating technologies,” said Lee. “Process technologies for mass production will be a major issue with solid-state batteries.”

Samsung has been hosting open forums on future technologies since last year, particularly on artificial intelligence and quantum dot technologies.

Its second forum on AI will be held on Sept. 12 and 13.

Electric car maker Tesla’s move last week to cut 9 percent of its workforce will sharply downsize the residential solar business it bought two years ago in a controversial $2.6 billion deal, according to three internal company documents and seven current and former Tesla solar employees.

The latest cuts to the division that was once SolarCity — a sales and installation company founded by two cousins of Tesla CEO Elon Musk — include closing about a dozen installation facilities, according to internal company documents, and ending a retail partnership with Home Depot that the current and former employees said generated about half of its sales.

About 60 installation facilities remain open, according to an internal company list reviewed by Reuters. An internal company email named 14 facilities slated for closure, but the other list included only 13 of those locations.

Tesla declined to comment on which sites it planned to shut down, how many employees would lose their jobs or what percentage of the solar workforce they represent.

The company said that cuts to its overall energy team — including batteries to store power — were in line with the broader 9 percent staff cut.

“We continue to expect that Tesla’s solar and battery business will be the same size as automotive over the long term,” the company said in a statement to Reuters.

The operational closures, which have not been previously reported, raise new questions about the viability of cash-strapped Tesla’s solar business and Musk’s rationale for a merger he once called a “no-brainer” — but some investors have panned as a bailout of an affiliated firm at the expense of Tesla shareholders. Before the merger, Musk had served as chairman of SolarCity’s board of directors.

The installation offices that the internal email said were targeted for closure were located in California, Maryland, New Jersey, Texas, New York, New Hampshire, Connecticut, Arizona, and Delaware.

The company also fired dozens of solar customer service staffers at call centers in Nevada and Utah, according to the former Tesla employees, some of whom were terminated in last week’s cuts. Those employees spoke on condition of anonymity because making public comments could violate the terms of their severance packages.

“It’s been a difficult few days — no one can deny this,” a Tesla manager wrote in a separate internal email, sent to customer service employees shortly after the cuts were announced.

Tesla has been burning through cash as it tries to hit a target of producing 5,000 Model 3 electric sedans per week after production delays. The company faces investor pressure to turn a profit without having to tap Wall Street for additional capital.

The total number of cuts to the solar workforce remained unclear. Some personnel at facilities closing down were being transferred to other sites, the current and former employees said. SolarCity employed about 15,000 people at the end of 2015 but has since cut thousands of workers.

Ending the Home Depot partnership, which allowed for solar sales in about 800 stores, is part of Tesla’s larger effort to absorb SolarCity into its high-end brand and sell through 90 of its 109 U.S. retail stores and its website, the company said.

“Tesla stores have some of the highest foot traffic of any retail space in the country,” Tesla said.

Analysts questioned Tesla’s plans for the solar business in light of the latest cuts to staff and retail operations.

“In effect, they seem to be saying, We have no strategy for selling solar,” said Frank Gillett, an analyst at Forrester Research, adding that the SolarCity purchase “looks pretty awful right now.”

Falling sales

In the first quarter of this year, Tesla installed 76 megawatts of solar systems – down from SolarCity’s more than 200 MW a quarter in early 2016, when it was the leading player in the industry. In announcing quarterly results in February, Tesla said growth in solar deployments would resume later this year.

Tesla’s falling solar sales also could jeopardize the future of a joint venture with Panasonic, announced as Tesla moved to acquire SolarCity in 2016, to produce solar modules at a new factory in Buffalo, New York.

Tesla has an agreement with New York state requiring the company to spend $5 billion within 10 years. If Tesla fails to meet that obligation and others, the company may be required to pay tens of millions of dollars in penalties at various milestones, could lose its lease, or be forced to write down the assets, the company told investors in a May filing.

In response to questions from Reuters, Tesla said it is meeting its hiring and spending commitments for the factory.

In March, a Delaware judge ruled against a Tesla motion to dismiss a lawsuit by the company’s shareholders over the SolarCity deal. The lawsuit alleged Tesla’s board of directors breached its duties to shareholders by approving the merger.

SolarCity founder Lyndon Rive, who is Musk’s first cousin and left Tesla last year, did not respond to a request for comment.

High marketing costs

The move to end the longstanding Home Depot partnership blindsided many staffers because Tesla had announced an expansion of the arrangement as recently as February.

GTM Research analyst Austin Perea estimated the partnership has recently accounted for about half of sales, in part because of previous Tesla moves to cut back on other sales and marketing costs.

Such third-party retail partnerships are among the most expensive means of generating solar sales, according to the clean energy research firm, in part because retailers take a cut of each sale.

The cost of winning a customer through a store like Home Depot can be up to $7,000 per system, according to GTM Research, compared with a national average of $4,000 per installation.

Home Depot spokesman Stephen Holmes said the retailer’s relationship with Tesla would last through the end of the year, adding that Home Depot would continue a partnership with Tesla competitor Sunrun in an undisclosed number of stores.

Over the past year, Tesla has stepped up efforts to sell solar and batteries for energy storage in its retail stores, something Musk said last year was “a much more efficient channel for demand generation.”

At the same time, Tesla stopped door-to-door sales, once among SolarCity’s most successful means of reaching new customers, and salespeople were no longer allowed to hold local events or buy online leads, the former employees said.

Such tactics are standard practice across most of the competitive residential solar industry.

The Home Depot partnership was costly but also integral to Tesla’s solar panel sales, a former employee told Reuters.

“It’s an expensive account,” the former employee said, “but it does bring in all the revenue.”

Solar energy and energy storage are rapidly being adopted by homeowners and Fortune 100 utilities alike. The speed of this adoption is unheard of for any type of electric energy technology.

Solar energy and energy storage are rapidly being adopted by homeowners and Fortune 100 utilities alike. The speed of this adoption is unheard of for any type of electric energy technology. Together, solar and storage offer a carbon neutral path to greater electrification throughout the economy — think electric vehicles and advanced manufacturing.

The results are impressive. More than 50,000 megawatts of generating capacity are now in place in the U.S. Over the past decade, solar installations have grown by nearly 60 percent a year on average. And in the past five years alone, prices have fallen by more than 50 percent.

Storage is reaping the benefits of growing electric vehicle demand through increased investment in storage technologies. What’s more, in early 2018 federal energy regulators cleared the way for even more storage on the grid.

These changes are also reflected in the programming offered by national solar industry leaders the Solar Energy Industries Association (SEIA), and the Smart Electric Power Alliance (SEPA), who host North America’s largest solar and storage event, Solar Power International (SPI) and Energy Storage International (ESI). The events help attendees see future trends about the energy industry on a whole. As we see more integration, new opportunities are presented, such as the recently added live microgrid, which allows delegates to see firsthand how solar and energy storage improves grid reliability and resiliency.

In addition to technological advancements in the industry, experts say primary drivers behind the rise in solar and storage are tax and policy initiatives at the federal and state levels. These policies, including the Treasury Department’s Investment Tax Credit and the Energy Department’s landmark SunShot program, help lower solar energy’s cost.

A defining event for energy storage was California’s response to a 2015 accident at a natural gas storage site. A massive, uncontrolled leak threatened gas supplies to power plants, schools and businesses in Southern California.

State officials approved deployment of more than 100 MW of battery-based energy storage in response to the crisis. One of the systems was a 20 MW/80 megawatt-hour (MWh) battery installed by Tesla in less than three months.

The crisis proved that developers could design, build and commission a substantial amount of energy storage in a short amount of time. Installing an equal amount of natural gas-fired generation likely would have taken years.

On the commercial front, companies like Target, Kohl’s and Costco are investing in solar in record amounts. By adding more than 40 MW in 2017, Target now has the most MW of installed solar capacity among big box retailers.

With this impressive track record, utilities and commercial users are investing more in solar and storage. For example:

• Arizona Public Service signed a 15-year power-purchase agreement with First Solar to provide peaking power from a 50 MW solar-powered battery paired with a 65 MW solar array.
• Ameren Corp built a microgrid to service central Illinois in 2017. The facility is one of the only utility-scale microgrids in the U.S. that serves live customer loads. If the grid-connected electric distribution line fails or is knocked out by a storm, the microgrid can provide 180 residences and 12 commercial buildings with power from dedicated wind, solar and natural gas resources, all backed up by battery energy storage.
• New York State’s Clean Energy Jobs and Climate Agenda, released in 2018, calls for the deployment of 1,500 MW of energy storage by 2025. State officials are working to compile a list of storage projects, and plan to add storage to many large-scale renewable energy projects.

Conditions are ripe for large commercial and utility-scale investments in solar energy plus storage. Public policy has provided a solid foundation for both technologies to flourish and public demand for carbon neutral energy remains as strong as ever.

If you are interested in learning more about how utilities, installers, project developers and others are transitioning towards solar and storage integration, Solar Power International and Energy Storage International is the place to engage with policymakers, decision makers, and experts in industry. The event takes place September 24-27, 2018, at the Anaheim Convention Center in Anaheim, California.

In early April, the People’s Republic of China established a new Ministry, the Ministry of Natural Resources (MNR). The creation of the new Ministry was part of a programme to restructure the country’s State Council (Cabinet).

The MNR took over all the responsibilities of the previous (and now disestablished) Ministry of Land and Resources (MLR), the State Oceanic Administration and the National Administration of Surveying, Mapping and Geoinformation. (The MLR had been responsible for the administration, protection, planning and use of China’s land and mineral and some marine resources.) The MNR also took over relevant responsibilities from other, still active, Ministries and agencies – for example, it took over the responsibility for grassland survey and ownership registration from the Ministry of Agriculture. The function of the MNR is to provide more efficient oversight of the development and protection of the country’s natural resources, including minerals.

Strikingly, the man appointed to be the first Minister of Natural Resources, Lu Hao, was described, after his appointment, by the Reuters news agency as a “rising star”, “a [relatively] young politician who’s risen swiftly through the Communist Party ranks over the past 15 years . . . becoming the youngest provincial governor in the country when he was made governor of Heilongjiang . . . in 2013 . . . Lu was Beijing’s youngest vice mayor when he was named to the position in 2003 at the age of 35”. This suggests high importance is being assigned to the MNR.

Also strikingly, within a month of its formation, the MNR released into the public domain (on the website of the National Geological Archives of China) between 56 000 and 85 000 geological information and data files that had previously been kept secret. This means that there are now 169 609 such files that are publicly accessible. This single act provides a major facilitation to, and stimulus for, the private-sector mining industry (as well as others interested in the minerals and mining sector).

TREASURE CHEST

When it comes to minerals and metals, China is usually thought of as an importer and consumer, and Chinese demand has indeed brought great benefits to many minerals exporting countries. But the country, geographically the fourth-biggest in the world, has its own very extensive resources and mining sector.

“China is rich in mineral resources, and all the world’s known minerals can be found here,” states the China Internet Information Centre (CIIC) website. “To date, geologists have confirmed reserves of 153 different minerals, putting China third in the world in total reserves. The reserves of the major mineral resources, such as coal, iron, copper, aluminium, stibium [antimony], molybdenum, manganese, tin, lead, zinc and mercury, are in the world’s front rank.” The country had coal reserves of 1 007.1-billion tons and iron-ore reserves of 46.35-billion tons. “The national reserves of rare-earth metals far exceed the combined total for the rest of the world.”

The China Geological Survey (CGS) divides China into three broad regions – eastern, central and western. “The eastern region,” it reports on its website, with its excellent communication networks, “holds an important position nationwide in terms of its production of raw material industries. The central region has abundant energy, multimetal and nonmetallic mineral resources . . . The concentrated distribution of mineral resources in the western region produces a strong competitive advantage for the area and provides a strong foundation of resources for pillar industries. Among the 157 mineral resources with proven reserves throughout the country, 138 are found in the western region. The area is rich in nonferrous metal resources and a major reserve area for nonmetallic mineral resources. There are also many kinds of metallic and nonmetallic ores of high grade found in the region.” (Note there is a slight discrepancy between the CIIC and the CGS about the number of minerals with reserves in the country.)

Recent new discoveries have, for example, significantly increased the country’s reserves of energy minerals. In January, Shanxi provincial authorities announced that the provincial coal reserves increased by almost 10.5-billion tons over the past five years. (In 2014, Shanxi’s coal reserves totalled 294-billion tons.) The province mined more than 16.2-billion tons of coal from 1949 to 2014, amounting to 25% of total national output.

Shanxi is actually in the process of closing down obsolete mines and developing new, modern (known in China as ‘advanced’), operations. During the past five years, 56 mines, with a total production capacity of 51-million tons, have been closed down. At the end of last year, the province had 615 operational coal mines, with a total annual production capacity of 909.8-million tons. Of this figure, 40% came from new (advanced) operations. This year, it will close 36 mines, with a total capacity of 23-million tons. Shanxi plans to have more than 60% of its coal being produced by advanced mines by 2020. To this end, in March, it issued its first licence for a coal mining project in 13 years. This went to Jinneng Group, for its Dongda Coal project. This is the first of 19 new mine projects the province expects to approve.

Subsequently, in April, authorities in Anhui province announced the discovery of reserves of more than 4.8-billion tons of coal and almost 100-billion cubic metres of natural gas. The coal was located in the Huainan-Huaibei coalfield, while the natural gas (mainly coal-bed methane and shale gas) had been found in the Huainan coalfield.

China is, unsurprisingly, the world’s number one coal producer. It is also the world’s number one gold producer, and has been for more than ten years (South Africa is now in only seventh place, after Australia, Russia, the US, Canada and Peru.) During the first quarter of this year, Chinese gold mines produced 80.807 t of the precious metal, a slight increase over the 80.542 t mined during the first quarter of last year. However, gold production as a by-product of base metals mining declined 15.7% year-on-year, which means that the country’s total gold output fell 3% during the first quarter of this year, compared with the first quarter of 2017. This decline was the result of Beijing forcing operations located in nature reserves to reduce or terminate their gold production.

OPEN FOR BUSINESS

China transformed its economic model, away from a totally socialistic system to a fundamentally capitalist one (although officially designated as “socialism with Chinese characteristics”), starting in 1978. In 1986, the Mineral Resources Law opened up the country’s mining industry to local private investors. In 1993, the Chinese mining sector was also opened to foreign investors. The Mineral Resources Law was revised in 1997 to make it easier for foreign companies to create joint ventures with Chinese companies that have been awarded exploration licences. Beijing has developed a permitting process that the Investing News Network (INN) describes as “transparent, straightforward”. Mining companies active in China have to pay a 3% resource tax, a 25% income tax and a 17% value-added tax on the sale of concentrates.

Under the current (13th) Five-Year Plan (2016–2020), the focus of the Chinese economy moves from manufacturing to services. However, the country is expected to remain a major force in the global mining sector. “The total consumption for minerals will still be very large,” Silvercorp Metals director Yikang Liu told INN in an interview last year. (Liu had previously been chief geologist of the erstwhile Ministry of Metallurgical Industry, a vice-chairperson of the Geological Society of China and a former deputy general secretary of the China Mining Association. Silvercorp has a primary listing on the Toronto Stock Exchange and is China’s top silver producer.) “Many minerals, such as iron-ore, will soon cross the highest consumption point. In China’s economy, the important status of mining will not change.”

And the Chinese government continues to open up the country’s economy, including mining. At the World Economic Forum in January 2017, President Xi Jinping assured that his administration would “expand market access for foreign investors . . . strengthen protection of property rights and level the playing field to make China’s market more transparent and better regulated”.

In July last year, Beijing reduced the number of restrictions on foreign investment from 93 to 62. Mining-specific measures saw reductions in restrictions on foreign investment in the mining and processing of lithium, the exploration and mining of precious metals, and the smelting of antimony, molybdenum, rare-earth metals, tin and tungsten, as well as in the development of “nonconventional” oil and gas sources.

“We are going to send a strong signal: China will continue to actively attract foreign investment, and will take further steps to deepen the reform and unswervingly open China wider to the rest of the world,” affirmed Premier Li Keqiang at the Chinese Communist Party’s nineteenth Congress last October. Beijing is also committed to creating an “ecological civilisation”: environmental protection is now also a priority. “The Chinese government will continue to promote green mining strategies in the mining industry,” explained Liu. “As long as a mining company receives high-quality mining rights, seriously abides by State laws and regulations, implements strict mine management, uses advanced mining technology and is committed to a high level of social responsibility to local communities, then this company will have stable production and profitability in China.”