$1.6 trillion investment needed in battery industry by 2040
To plug the gap betweentoday’s battery industryand 2040 battery demand will require at least $1.6 trillion of investment. This is almost triple the $571 billion needed to meet 2030 demand.
Such large investments are needed as battery demand is forecast to grow from 937 gigawatt-hours in 2023 to 3.7 terawatt-hours in 2030. From 2030 to 2040, battery demand will double again, according toBenchmark’s Lithium ion Battery Database.
Of this 2040 investment, 44% is needed to build thebattery gigafactoriesthat produce the battery cells and assemble the packs.
As more gigafactories come online and an increasing number of electric vehicles reach their end of life, thebattery scrap poolis set to grow substantially.
To build the capacity required torecycle this scrapintobattery materialswill require $26 billionby 2030. The required investment grows five-fold to $157 billion to process the large amount of battery scrap that is forecast to be available by 2040.
Of the critical raw materials,lithium will require the largest investments: $94 billion to meet 2030 demand, and double that to meet 2040 demand.
Cathode active materialproduction accounts for 52% of the midstream investment needed to meet 2040 demand.
These investment costs are all based on Benchmark’s base case scenario. If theambitious targets set out by policymakersand industry are all to be met, this investment number will need to increase even further.
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