Fast Company

The Rush To Electric Cars Will Replace Oil Barons With Lithium Dictators

In the latest installment of the Butterfly Effect we look at how mining the key ingredient in electric cars could end up enriching potential enemies of America, and force another round of innovation to build an even newer kind of battery.

Bolivia

1. Revenge Of The Electric Car

One day in late 2005, after losing yet another bruising political battle to the bean counters inside General Motors, then-vice chairman “Maximum” Bob Lutz heard of a startup called Tesla Motors intending to bring an all-electric sports car to market. Enraged that a bunch of Silicon Valley gearheads could do what he couldn’t, Lutz, in his own words, “just lost it.” He rallied his fellow car guys within GM to develop the prototype of what became the Chevrolet Volt--the “moon shot” justifying the company’s survival and the first in a new wave of electric vehicles just beginning to break on dealers’ showrooms. And while the Volt uses just a tiny bit of gas, it's still powered by a material that is in short supply and controlled by some of the most hard to deal with governments in the world. Its lithium battery might just create a new geopolitical calculus that is just as problematic as the gas-based one electric cars are supposed to extricate us from.

In his new book, Car Guys vs. Bean Counters, a triumphant Lutz mockingly recalls Toyota’s reaction to the Volt’s unveiling in January 2007. “Toyota immediately labeled Volt a clever but meaningless PR exercise, using a battery chemistry, lithium-ion, which was dangerous, unreliable, and far from ready for automotive use. How much sounder, they trumpeted, was their own homely little Prius using (now eclipsed) nickel metal hydride batteries.”

Toyota was wrong. The lithium at the heart of the Volt’s battery is now the gold standard for new electric cars everywhere. But is there enough of the silvery soft metal to eventually power a billion automobiles, and can we mine it fast enough? Or are we trading one finite resource for another? And in doing so, will we also trade our allegiance from OPEC to OLEC--the “Organization of Lithium Exporting Countries?”

2. Peak Lithium?

A month before the Volt announcement, an energy analyst named William Tahil published a paper titled “The Trouble With Lithium.” There simply isn’t enough cheap lithium to go around, he argued, and 80% of the world’s accessible reserves are located in the so-called “Lithium Triangle” of the Chilean, Argentine, and Bolivian Andes (pictured above). “If the world was to exchange oil for Li-ion based battery propulsion,” Tahil wrote, “South America would become the new Middle East. Bolivia would become far more of a focus of world attention than Saudi Arabia ever was.” Even then, we would run out of lithium long before we’d finished electrifying our cars.

Tahil’s paper immediately came under fire for his overly pessimistic predictions. (And his general credibility.) Researchers at the Argonne National Laboratory outside Chicago--a hotbed of lithium battery innovation--estimate worldwide demand will eventually top out at 8 million metric tons, total. (The Volt’s massive battery array only requires about nine pounds.) That’s well within the U.S. Geological Survey’s conservative estimate of 12 million tons of recoverable reserves. As refining improves and new deposits are discovered, that figure will only go up. And unlike oil, lithium can be recycled; once you get it out of the ground, it’s yours.

That’s easier said than done. Worldwide lithium production was 120,000 tons in 2009, roughly a quarter of which was bound for batteries. But if electric cars achieve just a 5% penetration rate by 2020, according to the British research firm Roskill, the 60,000 tons required for batteries will outstrip the available supply. The bottleneck isn’t “peak lithium,” it’s how fast and how badly we want our electric cars.

3. From Petro-Dictators To Electro-Dictators?

Fortunately for GM and Toyota, Chile’s and Argentina’s lithium deposits are open for business. But the largest lies across the border in Bolivia, containing anywhere from 9 million (the official U.S. estimate) to a credulity-straining 100 million tons of lithium. Bolivia’s president Evo Morales (left) is no friend of the U.S., however; he pals around with Venezuela’s Hugo Chavez and Iranian president Mahmoud Ahmadinejad. He once expelled the U.S. ambassador and likes to end speeches with the rallying cry, “Death to the Yankees!”

But Bolivia has had no shortage of supplicants. Representatives from China, France, Sumitomo, Mitsubishi and LG Chem--which supplies the Volt’s battery--have all made entreaties. What would happen if Morales gave in and went with a Chinese consortium, or picked a fight with Chile? If the Carter Doctrine was necessary to secure Middle East oil, will there someday be an Obama Doctrine for South American lithium?

“Chile is the one we can rely on," says Steve LeVine, a contributing editor to Foreign Policy and an energy security expert at Georgetown. "But I just got back from Kazakhstan, and they have a lot of lithium, and it’s cheap.” Then again, Kazakhstan is a virtual autocracy ruled for 20 years by the opposition-less President Nursultan Nazarbayev. Afghanistan may also be rich in lithium if reports of a trillion dollars in mineral wealth are accurate. But America’s relationship with president Hamid Karzai is complicated, to say the least.

After Bolivia and Chile, the nation with the largest reserves is China, which knows how to play hard ball with minerals--witness the recent fights over rare earth metal prices when China restricted their exports. While there is no OLEC looming on the horizon, the U.S. once again finds itself staking its way of life on a substance with very complicated geo-politics.

4. If It's Not Lithium, It's Something Else

There are two alternatives to entrusting the bulk of America’s lithium supply to Chile, Bolivia, or even Afghanistan--discover new sources closer to home, or innovate our way out. In Bottled Lightning, author Seth Fletcher pays a visit to Western Lithium’s stake in the Nevada foothills where it hopes to mine lithium from clay deposits. A spin-off from Lawrence Livermore National Laboratory called Simbol Mining believes it can meet nearly a fifth of the world’s needs by mining California’s (chemical-rich) Salton Sea.

The other option is to treat Li-ion batteries as a bridge technology on the way to something lighter, cheaper, and better. “We need something with the energy density of gasoline,” says LeVine. “We need the new technology--sulfur-air, zinc-air, lithium-air.” Other teams are working on a battery made of molten melts and salts.

One startup that had eschewed lithium for zinc-air is the Easton, Pennsylvania-based Eos Energy Storage, which is in talks to license its proprietary battery to the automakers. “Zinc is energy dense, safe, and stable,” says Eos CEO Michael Oster. “The U.S. is one of the top five producers in the world, along with Canada and Australia. So, in terms of energy independence, that’s one way to get there.”

Of course, there is always the possibility that lithium isn’t the real bottleneck at all. What keeps LeVine up at night is phosphorous, which is used in the Li-ion chemistry used by A123 Systems and Chinese battery makers. It is also vital to food production and is rapidly running out. (The U.S. doesn’t have much it, either.) And then there are the rare earth metals essential to an electric car’s permanent magnets, 97% of which are found in China. In perhaps a taste of what’s to come, Chinese officials have drastically cut exports since the beginning of the year, causing prices to soar as high as 475%. If this keeps up, oil prices may start to seem like a bargain.

Check out the previous installment of the Butterfly Effect: Melting Arctic Ice And The Fight On Top Of The World

[Images, from top: Salar Uyuni, Wikimedia Commons; Chevy Volt, Wikimedia Commons; Evo Morales, Wikimedia Commons]

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17 Comments

  • Beccu, Klaus Ph.D.

    There will be no rush on Lithium, at the best a minor demand will occur: 1% market share for E-vehicles in 2020 according to serious studies (Avicenne, Harris Ford etc).  Reason: researchers have a tough time to solve the major problem of Li-ion batteries: the short calendar life time of the very expensive battery - 20% irreversible capacity loss already in 12 months (ref: DOE report of June 2010 and Argonne Nat.Lab "Why Li-batteries die so young" http://t.co/62c8vUI).  Moreover, safety problems as pointed out by Civil Aviation Safety Authority (News.com.au http://bit.ly/ok7wOl ) warning passengers over Li-batteries on planes.(http://bit.ly/ok7wOl). Safety in Li-powered cars with its huge storage capacity (> 20 kWh) in case of fire would cause a desaster. .

    Therefore, Toyota was right saying: “the Volt is a clever but meaningless PR exercise,
    using a battery chemistry, lithium-ion, which was dangerous, unreliable,
    and far from ready for automotive use".  How much sounder, they
    trumpeted, was their own homely little Prius using (now eclipsed) nickel
    metal hydride batteries [1] [NiMH].  Recently, Toyota announced: " We will stay another decade with the (now eclipsed?) ultrasafe and lowcost NiMH batteries, since other automakers switch to Li-ion batteries having no capability to produce the highly efficient metalhydride batteries at a third of Li-ion cost".

    In fact, NiMH battery researchers have not slept and have reached in the 2nd generation now the same energy- & power densities as LiFePO4 batteries (120 Wh/kg; 2000 W/kg) and still at much lower cost. Protic [aqueous] electrolyte batteries such as NiMH or Nickel-Zinc have that precious advantage of very high safety over aprotic [organic] electrolyte as used in Li-batteries which in addition degrade or decompose with time.The dream of higher energy storage systems ends up at the frontier of natural laws.

    [1]  The NiMH battery is the first breakthrough in electrochemical storage technology after the use of redox systems. The reversible storage of H-atoms in the lattice of Ti-Ni alloys was invented at the Battelle Geneva Research Center and developed over 20 years for Daimler-Benz and Volkswagen, then commercialized & licensed to 30 companies worldwide by the US company ECD [Energy Conversion Devices, Inc. in Michigan] Currently, 2.5 mio hybrid cars are powered with NiMH which will mount to 4 mio. in 2020 according to the latest prognostics.

     
     

  • tim cotter

    Perhaps we could also consider changing our behavior. Isn't it getting all too complicated to navigate the resource constraints required so that we can keep driving our kids the 1 mile to school instead of walking.? Or commuting 20 miles to work each day, 1 person per car? Methinks our society is not getting the message that the way in which we get around is unsustainable and no matter how we try to tinker with the technology, we might just have to bite the bullet and learn to walk, ride a bike, take public transport, work closer to home, and support infrastructure investments to make all of these things more feasible.

  • Anonymous

    I agree but cars aren't just for "taking our kids to school" and "going to work".. It's for transporting food, oil, everything. If there are no cars, there are no food in the large cities like New York for example. Animals don't get food, the countries cant communicate. Well, there's something in what do you say, but it isn't 100% true. Another thing is that a car is 1t-1.5t, a SUV 2-3t, and a man is how much? 70kg?
    http://www.youtube.com/watch?v...
    http://www.youtube.com/watch?v...
    http://www.youtube.com/watch?v...
    Check this movie , it is about what would happen if we would suddenly run out of oil. This wouldnt happen probably because we have 40 years of proven oil (and at est. least 100 years of unproven oil) but if we run out of oil (we aren't sure how much oil is under us) and we won't have an alternative fuel it wouldn't be good.. (check the movie)

  • Wize Adz

    While the argument that lithium and oil are both streams of strategically important commodities in an electric or petroleum driven world is probably true in a macroeconomic sense, there's an enormous difference that everyone who makes this argument is missing: the frequency with which an individual needs to buy the commodity.

    Most people fill up their cars once or twice a week.  (I drive a lot less than most people, but that's irrelevant for this argument.)  That means that, if there's a shortage of oil, individuals will be oil-starved in a matter of days.Automotive traction batteries are legally required to carry an 8 year warranty (I forget how many miles).  So, automotive traction batteries last at least that long, and most are advertised as lasting the life of the vehicle.  There's currently 126k miles on the nickel-metal hydride battery in my wife's Prius, and it's still going strong, so we'll be putting another couple of thousand miles on the car over the July 4th holiday week.  Automotive lithium-ion batteries are of similar longevity (yeah-yeah, who killed the electric car, I'll listen to the engineers building the batteries, thinkyouverymuch).  In other words, the battery is likely to last about as long as the transmission in a conventional car -- and, but the time the economies of scale kick in, it will probably cost about the same too.  In other words, if there's a shortage of lithium, I don't have to worry about it until it's time to buy a new car.

    So, as an individual, instead of having to buy gas every few days, I go to having to buy lithium at about the same interval that most people currently replace transmissions/gearboxes.  That sounds like a pretty worthwhile strategic tradeoff to me.

  • Wize Adz

    Just do drive home the point further:Which is worse: people 1/7th of the working population being stuck at home in 2 days, OR, 1/8th of the working population not being able to buy a new car until the geopolitical situation gets sorted out?  I'll give you a hint --  the first case, you get riots in the streets, and in the second case you get grumpy letters to the editor and an increase in used car prices.  I just don't get why authors keep making the lithium=gasoline argument!  Yes, lithium becomes a strategic commodity but, no, it's not the same as gasoline.

  • ibertee

    Sorry Gabriel, Festival Loop is who I am citing for the comment.  And Gregg Lindsey does not refer to Evo as a dictator.  We Americans know Evo is a great humanitarian who speaks our for diversity.  That diversity means us Anglos are included in his loving live and let live philosophy. Maybe Evo will rub off on all of his neighbors.  We also understand the context of Gregg's article.  And, yes we are fearful when the leader of Colombia buddies up to a regional dictator such as Chavez.  But, don't hate us and don't refer to us as slave owners because we have the freedom and the resources to consume.  When given the choice of wealth and freedom,  I don't know of any human who would step forward and say...Hey Dude, I'd like to have a big heaping helping of poverty and oppression.  

  • Festival LOOP Colombia

    That's right. Leaders don't have to look back and consider poverty and opression. Power is mightier than reason.

    And feel free to consume... there is no visible limit of any resource in the horizon. Oops, it appears that some countries don´t feel like giving resources at cheap prices, but you can overcome that easily. Go bomb it, as ITT (today AT&T) did in Chile in 1973 to maintain copper supplies cheap for their phone lines. It´s easy to remember, because it happened a September 11th. 

    If you look at the map, you wil see that Bolivia is a different country from Colombia. And if you look further, you will notice that Colombia is USA's main ally in latinamerica, against your most feared enemy, Chávez (Does USA fear anyone?). 

    Don't get me wrong: There´s no way to ignore all the things your fertile society have invented, but unfortunately you live in an information bubble that sometimes doesn't let you see the whole landscape...A final phrase from Eduardo Galeano, Uruguayan writer: "democracy allows you to choose the sauce in which you will be served" (la democracia te permite escoger la salsa con la que serás comido)

  • Franklin Barbosa

    Scientists just discovered a new technology called bicycles, and it runs on human power!

    Sounds promissing, right?

  • ibertee

    It's the same old stupid game of cars and what it takes to run them.  We have enough natural gas to power all of our vehicles for a long time.  And, our vehicles that are already on the road can be converted to LNG or CNG at 2.1 per mile.  What we don't need are charging stations and what we do need is clean burning natural gas infrastructure. That's our bridge.  At that point Gabriel we gringos won't need any name calling from smaller Latin countries. However, Latinos will still come here by the millions to escape the very systems that you claim we denigrate due to pride. Gregg Lindsey is a reporter and he doe's not represent the american people's pride.  When he uses the word lithium dictators he's creating a tool to get people like yourself to read his article. And, he references a regional leader  who is most definitely your countries friend and a dictator. Your no slave my friend but you are an Anglo hater full of your own pride.  

  • Gabriel Magana

    Hmm you are citing to the wrong guy.  I don't care to get into a discussion about Evo Morales'policies or even immigration in general.

    All I said was that he was elected into office legitimately, so why call him a dictator?

  • Jym Allyn

    The "solution" to our war in Afghanistan is to sell the country to its next-door neighbor China in exchange for China supplying us with access to the rare-earth minerals from the NE Afghan mountains.
    China not only has a far greater cultural ability than we do to deal with insurgencies, but they have the moral discipline we don't have to destroy the heroin crop in SW Afghanistan.  (Heroin seems to be a "sacred crop" to our CIA.  Likely a residual from CIA activities during the Vietnam war.)

    Bringing into Afghanistan a force of 350,000 UN sanctioned Peace Keepers from China would let our soldiers come home immediately and give both Afghanistan and China the relationship they deserve.

  • Festival LOOP Colombia

    As Gabriel Magana said before, it is incredible that anyone who opposes to the eager United States' consuming of natural global resources must appear always as a dictator. As Bolivian democratic elected president Evo Morales hasn´t organized war overseas to maintain oil prices low, we could ask ourselves which government is the real dictatorship. Start looking another places where their governors are also eager of serving USA's interests, there are plenty of historical useful idiots that want to offer their natural resources in exchange for plastic, cars and technological garbage... as in greek democracy, you gringos are very democratic as long as your slaves doesn´t stand for their own pride.

  • Larry Nirenberg

    In regards to China, what we have is a trade policy problem.  Yes, they own a large chunk of our national debt but we also account for a large chunk of their production/economy.  Let's see, China gets to dump their goods on US business and consumers at artificially low prices and manipulates the price of rare earth and minerals by restricted trade and manipulation of their currency. We get blue jeans, tainted pet food, poisonous children's toys and other assorted chatchkees.  Our president needs to understand that we have some strong cards in our hand too and play hard ball with trade and currency policy by demanding a floating currency and less trade barriers and not just with China.  Given the flight of jobs out of this country and the massive in flow of imported goods in I fail to see the benefits to the US economy by so called "free trade".  Time to kick ass and take names.  

  • Gabriel Magana

    Why call Evo Morales a dictator?  Last I heard it was a fair election that put him in power.

    Or are you using the term "dictator" for anyone that does not like the USA?

    PS - I am a latino, but not Bolivian.  I am not trying to defend Morales. Associating him with "dictator" is what caught my eye.