Battery electric vehicles, or BEVs, and hydrogen fuel cell vehicles are expected to complement, rather compete with each other in the years to come, BloombergNEF battery metals analyst Dr Kwazi Ampofo told a virtual panel on Feb. 3.
"We don't see it as a race. It's going to be complementary technology ... even if you take a fuel cell vehicle, there is a battery in there, so even the vehicles are working together to advance a cleaner environment, so I don't see the reason why we as an industry should compete with each other," Ampofo told the Green Metals, PGMs and global decarbonization panel at the virtual Investing in Africa Mining Indaba 2021.
However, he said the different vehicles were expected to see preference and growth in different sectors.
Ampofo said BEVs were expected to be more favored in the light vehicles sector than hydrogen fuel cell vehicles, due to dropping battery prices and a wider choice of models.
"Battery costs have dropped 86% and our recent November/December 2020 survey, we found that batteries were going at around $127/KWh which is quite remarkable compared to where we were in 2010," Ampofo said.
He added that 10 years ago, only Tesla really made EVs, but today, almost every major carmaker offered a range of BEVs.
"What we see is that by 2025 there is going to be price parity between EVs and internal combustion engine cars, so when you walk into a showroom, it's not about price anymore - a Tesla might potentially be the same price as a Toyota," he said, adding that there were also a number of subsidies offered by governments to make BEVs more competitive.
He said hydrogen fuel cell vehicles were expected to make up around 25% of light vehicles sales by 2035-2040 in the scenario that the world looked to achieve zero emissions from vehicles.
"However, when you go to the high-end, heavy duty equipment, like trucks from the mines, buses and long-distance distribution vehicles, hydrogen vehicles penetrate as much as 75% of the global fleet by 2040," Ampofo said.
He said policy was a key driver for hydrogen fuel cells vehicles, particularly in the heavy-duty equipment industry, while another driver would be the cost of the electrolyzer.
He said that electrolyzer costs were the biggest constraints in the production of hydrogen, taking up around a quarter of total costs.
"The bottom line is that they don't compete, they complement each other and what we're going to see in at least the medium term, is that light vehicles will be heavily represented by BEVs and over the long-term we're going to see long distance, heavy duty vehicles favoring hydrogen more when electrolyzer costs do come down and policy becomes favorable," Ampofo said.
New EV sales to reach 26 million by 2030
Ampofo said that by 2030, BloombergNEF expected about 26 million of new vehicles sold globally to be electric.
He added that by 2040, 70% of new vehicles sold in China were expected to be electric, with this percentage to be around 65% in Europe and 60% in the Americas.
According to Platts Analytics, light duty plug-in EVs are expected to make up 6% of global car fleet by 2030 at 109.9 million vehicles, of which 21.1 million will be new sales, and 20% by 2040 at 377.7 million vehicles, of which 55.3 million will be new sales.
"If you look at hydrogen fuel cells, what we have seen is that last year, 11,000 new vehicles that were sold were fuel cell vehicles and we expect that to grow about six times by 2030. So overall, there's going to be a big shift in how we move around and how we transport each other," Ampofo said.
He said this was due to result in higher demand for battery metals.
Ampofo said lithium demand over the next decade in batteries alone was expected to grow by 10 times what it is now, cobalt to grow by 2.5 times 2020's global market of around 140,000 mt and aluminum y eight times 2020's volume.
"Overall, we expect an incredible amount of growth coming from all these metals that go into the batteries," Ampofo said.
He said this provided an opportunity for a number of African countries to "seize the moment," as distribution of battery metals was disproportionate globally, although Africa was fairly represented.
He pointed out that cobalt was heavily concentrated in the Democratic Republic of Congo, platinum heavily concentrated in South Africa, while some nickel and cobalt was found in Madagascar and Zimbabwe also had some nickel and lithium resources.
"It's up to these countries to seize the opportunities, because it's going to be an incredible growth and we can really meet supplies," Ampofo said.
