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The Success of the Electric Vehicle Industry and the Future of Transport Electrification 

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Dramatic improvements in automotive technology and the growth of the electric vehicle (EV) market have introduced a wide range of opportunities for the future of the global energy industry, representing one of the strongest impact strategies aimed at achieving global sustainability goals. The electrification of the transportation sector is expected to serve as a prime target for technological developments, with strong gains expected within the coming decades as the success of the EV industry leads to a rise in the development of new technologies and the transition towards a low-carbon global economy.

Examining the success of the EV industry and its wider implications on the energy industry, the Rystad Talks Industry webinar, held on Tuesday 1 February, featured the latest insights on the market and its wider implications for the industry as a whole, with Marius Kluge Foss, Senior Vice President of Global Energy Systems at Rystad Energy, stating, “If we look at the development over the last two years in terms of electric vehicles sales, the market has exploded, especially in 2021. We expect that to continue into next year.”

EVs are seen as a key development in the transition towards a low-carbon economy, and as battery costs decline, the demand for lithium iron phosphate batteries is expected to grow by over 110% towards the end of 2022, with China maintaining its position as the lead developer of EV batteries in the global market.

“Last year, we saw tremendous demand growth in battery materials. China is still at the epicenter of electric vehicles and electric vehicle batteries, holding a dominant position in processing capacities,” stated Susan Zou, Senior Analyst at Rystad Energy, adding, “Any trend in China is having an impact on the global market and, among all battery raw materials, lithium demand is in the spotlight.”

Although China has been driving the global rate of EV production and development, other countries, such as Norway, have continued to push towards zero-emission vehicle targets. Revolutionary new technologies, such as EV battery swap innovations, are reducing the cost of EVs, with multinational automobile manufacturer, NIO Norway, having introduced the first battery swap station to the Scandinavian country in January 2022, with plans to introduce a further 20 facilities throughout the year.

“This is the first power swap station outside China. In Europe, most of our customers still use DC chargers, but in Norway, we want to be part of the battery development,” stated Marius Hayler, General Manager at NIO Norway, adding that, while the demand is very high, the supply chain has restricted growth.

Despite limited supply of the critical components used to manufacture EV batteries however, Dennis Nobelius, COO of Swedish automotive brand, Polestar, also noted the surge in demand, stating, “We are working with multiple partners to improve the robustness of supply. And on top of that we have a multitude of start-ups that we are interacting with.”

Following its strong performance in 2021 despite the ongoing restraints of global chip shortages and the increasing supply costs for battery raw materials, Rystad Energy has projected a global market share increase of 12.8% in 2022, from 10.1% in 2021.

“Last year, we surpassed 50,000 electric cars globally with 50% of all investments over the next four years, about $1.9 billion, slated for investment in electric vehicles,” said Elin Rosnes Sinervo, Director at Audi Norway, concluding, “I really believe that all of transportation will go towards a more sustainable direction.”

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Matthew Goosen

Matthew Goosen

Matthew Goosen is a Video Editor and Content Writer at Energy Capital & Power. He holds an Honours Degree in Film and Media Studies at the University of Cape Town and is currently undergoing his Masters Degree. Born in Pretoria and raised internationally, he has been living in Cape Town since 2013.