How to meet the TWh era of power batteries?

Market research institutes estimate that by 2025, global sales of new energy vehicles will reach 16.4 million units. At that time, the global demand for power lithium-ion batteries will reach 1160GWh (19Wh), officially entering the TWh (1012Wh) era. In 2021, the cumulative output of continental power batteries will be 219.7GWh, which means that the next few years will still be a period of rapid growth of power batteries.

In the TWh era, how will the market structure change? What are the opportunities for industrial chain enterprises?

The market structure is gradually stabilizing

In recent years, the prosperity of new energy vehicles has been high. In 2021, the sales volume of new energy vehicles in mainland China reached 3.029 million units, an increase of 143% year-on-year. Driven by the heat of the industrial chain, mainland power battery companies are also developing rapidly, seizing the booming new energy vehicle market. In recent years, the list of enterprises with installed capacity ranking among the top ten new energy vehicle batteries in the mainland and their rankings have been changing, and the pattern of new energy vehicle battery enterprises in the mainland has not yet formed.

Xiao Taiming, deputy general manager of Yiqi Lihe, said that the reason why the ranking of the mainland power battery market continues to change is because the market is growing rapidly and the technical process is constantly innovating. In this process, who can grasp the market demand, who can gain the trust of downstream manufacturers, can achieve higher market share.

At present, there are still opportunities for power battery companies to achieve greater market share with technological innovation and cost reduction. When the new energy power battery enters the TWh era, the competitive landscape of various enterprises will tend to be stable. In 2021, the sales volume of new energy vehicles in mainland China increased by 143% year-on-year, when the installed capacity of new energy vehicles entered the TWh era, market growth will slow down, at that time, the interannual growth rate of new energy vehicles will remain at about 10% to 20%, and the new energy power battery market will also appear more fixed head enterprises.

At this stage, who will become the head enterprise of the TWh era is still not easy to decide. However, in Xiao Taiming's view, battery manufacturers who cooperate with the whole machine manufacturer will have more opportunities, and the auto machine companies that lay out the battery cell track will also have a strong industry initiative.

Battery bulk

In the TWh era, the amount of power battery consumption increases, the technical route is gradually fixed, the materials in various links will be more standardized, and the positive and negative electrode materials and lithium salts of the power battery machine will have more characteristics of bulk commodities - homogenization, large quantities can be bought and sold, and can be widely used.

The bulk of batteries and their materials will be good news for the leading enterprises in the field. In the case of commodity bulk, the right of enterprises to speak is closely related to their market share. The head enterprise has a large-scale product supply capacity, and the bulk development of batteries and their materials will provide greater profit margins for such enterprises.

The bulking brings not only the standardization of products, but also the refinement of the division of labor in supply, and each supplier will supply more subdivided products. Therefore, Xiao Taiming believes that for those suppliers whose market share is not high, it is necessary to find a differentiated competitive strategy, look for a more segmented market, develop in the direction of personalization and specialization, and look for market opportunities in more marginal areas.

Less cobalt, no cobalt, new materials

The material determines the battery performance. Huang Xuejie, a researcher at the Institute of Physics of the Chinese Academy of Sciences, said that power battery materials are bound to change.

In view of the technological changes that may be brought about by the field of power batteries, Huang Xuejie proposed several major technical development directions: First, with less cobalt or even no cobalt. Second, supply more energy with less lithium. Third, look for negative electrode materials that consume less energy. Fourth, all solid.

Ternary lithium batteries are the battery types with the largest energy density and the strongest endurance on the market, and cobalt is an important raw material for ternary lithium batteries. In recent years, the cobalt content in ternary lithium batteries has shown a gradual downward trend. From NCM333 (nickel, cobalt and manganese three elements content ratio of 3:3:3) to NCM523, NCM622 and then NCM811, the cobalt content required in ternary lithium batteries has gradually decreased. Among the cathode materials of ternary lithium batteries, cobalt is the most expensive metal. Since the beginning of this year, the price of cobalt has risen from less than 500,000 yuan per ton to about 550,000 yuan per ton.

Huang Xuejie said that the current technological development has two routes: one route is to reduce cobalt, the content of cobalt is reduced from 10% to 5%, and it is possible to reduce the cobalt content to 2% to 3% in the future; the other route is completely cobalt-free.

Regarding the next generation of battery materials, Huang Xuejie said that many schools and research institutions are studying new material systems, including solid-state batteries, new lithium salts, silicon carbon anode materials, etc. There are many opportunities for such materials, which are also the focus of the research institute.

Solid-state batteries are the development direction of power batteries. At present, the industrialization of solid-state batteries has just begun. At present, the so-called "solid-state battery" on the market can only be called "semi-solid-state battery", but in the existing lithium-ion battery, more or less added part of the solid-state electrolyte, which in turn improves the safety of the battery to a certain extent. Huang Xuejie said that the so-called "solid-state battery" and "semi-solid-state battery" on the market are still using common power battery materials, and their essence has not changed.

After 2030, when the TWh era comes, all-solid-state batteries may become the mainstream of the industry. Huang Xuejie said that in the all-solid-state battery, lithium hexafluorophosphate, which is currently the main material of the battery electrolyte, will be replaced, the separator will also appear in the form of a new solid electrolyte membrane, and the negative electrode material will also change, but the cathode material is still likely to be a common oxide material on the market.

However, the possibility of solid-state batteries achieving technological breakthroughs and even mass production in the past three years is very small, and Huang Xuejie said that the changes that may be brought about by solid-state batteries can be ignored for the time being.

Lithium hydrogen?

The endurance of electric vehicles and the speed of charging and discharging are the indicators that consumers are most concerned about. These two indicators are determined by the positive and negative electrode materials and electrolyte materials that make up the battery cell.

Since lithium-ion batteries with lithium cobalt oxide, lithium iron phosphate and other materials as cathode materials have high energy density, lithium-containing materials have become the most common choice for cathode materials for new energy vehicle power batteries. For example, the cathode material of BYD blade batteries is lithium iron phosphate, and Tesla car batteries use ternary lithium.

According to estimates, each GWh lithium iron phosphate battery needs to use about 520 tons of lithium carbonate, the current mainstream ternary lithium battery NCM811 type, each GWh battery needs 620 tons of lithium carbonate, while 750 tons of nickel, 100 tons of cobalt. The price increase of these three major types of metals will greatly bring about fluctuations in the power battery industry chain.

In this case, will hydrogen fuel cells with less demand for metals become an alternative to new energy batteries?

Unlike dry batteries, which are used as energy storage devices, hydrogen fuel cells are more similar to a power generation device, which can directly convert chemical energy into electrical energy. At present, the energy supply of urban ground transportation is mainly batteries, and hydrogen fuel mainly solves the energy supply problem of long-distance transportation. In aircraft, ocean-going ships, long-distance heavy trucks and other means of transport, hydrogen fuel cells have achieved a wide range of applications.

"The development of hydrogen fuel cells and the development of lithium batteries are not a substitute relationship, the two are mutually reinforcing." Mo Ke, chief analyst of the True Lithium Research Institute, said, "Hydrogen fuel cell is a power generation device, and lithium battery is an energy storage device. On many carriers that use hydrogen fuel cells as a drive, energy storage devices are also needed. ”

Huang Xuejie also believes that if the market demand for hydrogen fuel cells expands, it will not only replace lithium batteries, but also promote the expansion of the lithium battery market.