Advanced Propulsion Centre demand report highlights confidence

Increased confidence in the sector and a rise in BEV demand to 2027 has been detailed in the latest Quarterly Demand Report (Q3) from the Advanced Propulsion Centre UK (APC).

Much of the increased confidence in the sector comes on the heels of Nissan’s decision to produce three new BEV models in the UK, it states, as well as a commitment to building a new gigafactory in Sunderland, which will comprise an estimated £3 billion investment in total.  

This latest quarterly report highlights, the opportunities for the UK to localise the lithium supply chain, boosting jobs, and potentially reducing environmental impact too.

The UK has both hard rock and geothermal brine sources of lithium, and current forecast domestic supply is 46.5 kt of Lithium Carbonate Equivalent (LCE) compared to a demand of 64 kt.

A number of companies, many of whom have received funding from the APC, are involved at varying stages in the lithium extraction process, and there is time for new projects to come online, and for faster scale-up, with appropriate support, in order for the UK to meet the stated forecast. 

Dr Hadi Moztarzadeh, Head of Technology Trends, APC said: “We are starting to see the impact of the ZEV mandate in production plans and investment in the UK, alongside OEM strategy announcements for electrification. This is moving the UK automotive sector to a higher percentage of zero-emission vehicles faster than we are seeing in many other countries.

“Nissan’s recent announcement of investment in the UK is welcome news, which followed BMW’s investment in electric Minis, and JLR’s gigafactory commitment. These announcements combined with Government’s Advanced Manufacturing Plan and the UK Battery Strategy will encourage other companies to look at the opportunities here. No doubt there are challenges ahead, but it is a really exciting time for the industry and these announcements show the UK can meet those challenges and support the industry and the broader global ecosystem through the transition to net zero.”

Dr Chris Jones, Strategic Trends Manager, APC added: “As covered in our recent Automotive battery value chains report, there are clear demand signals from automotive OEMs for Lithium Iron Phosphate (LFP) batteries. Currently, Nickel Manganese Cobalt (NMC) chemistry dominates the automotive battery market and from an investment point of view, you have access to a larger market if you are part of the NMC supply chain. So, despite those signals, the investment has been in setting up the NMC battery supply chain and less has been happening around LFP chemistry.” 

“Lithium is a critical material for both NMC and LFP chemistries. So, we looked at global lithium supply chain, including lithium extraction and upstream side, and the UK has some rich sources of lithium, in particular in brines, but also in granite deposits. The UK has many advantages that make it an attractive place to process material – for example we have Green Lithium, Leverton Lithium and Tees Valley Lithium looking to process lithium for batteries. Not only could these facilities service the UK market, but they could also supply non-domestic markets with a low- or zero-carbon battery grade lithium supply.”

Image from Shutterstock

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