Potential challenges to increase demand for resources in EV sector

Electric vehicles are growing rapidly today and have become most popular in the automobile sector for its zero-emission feature. The growth of electric vehicles since 2019, starting 10 months itself the sales of the electric vehicles accounted for 2.2 per cent of the global vehicle market. In 2018 there were more than 5 million electric vehicles worldwide which are an increase of 63 per cent in the previous year.

But this year, 2020 due to global coronavirus pandemic and economic challenges the sales of global electric vehicles have been dropped by 43 per cent. However, it will gradually pick up as there will be improvements in the economy. But there are some major challenges that are there since ages till today to increase the demand for resources in the EV sector.

Demand for resources in EV sector

The challenges that obstruct the growth of the electric vehicle sector in India include

• High manufacturing costs and price competition with ICE counterparts,
• Lack of sufficient charging infrastructure and low performance and high cost of batteries.
• The scope of innovations of technology due to limited research and development capabilities is another challenge that the electric vehicles industry in India is struggling.
• Performance of electric vehicles is still not comparable with those of ICE vehicles in terms of range, speed, power etc.
• The electric vehicles policies in the States are still not clear in many things.
• Apart from all these challenges, the biggest challenges that have not received much attention is the growing requirement of different materials for manufacturing EVs and the lack of assessment of resource requirements for EVs.

Electric vehicles evolution in India

Electric vehicles require a substantial amount of newer materials mostly in lithium, rare earth, flame-retardant and thermoplastic materials which are not available abundantly or it may be expensive. Availability of raw materials is a major challenge and calls for developing various strategies of supplying raw materials at affordable prices.

The EVs need many new materials that can develop the performance for manufacturing batteries and powertrain. For instance, if we look about lithium it is an important resource that is used in the manufacturing of the batteries used in electric vehicles. But the resource is available in abundance only in Chile, China, Argentina and Australia with their global reserves of lithium over 95%.

Cobalt is also used in manufacturing batteries for electric vehicles and is largely found in the Democratic Republic of Congo (DRC), Central Africa and has a high supply chain.

The other main component used in electric vehicles are the motors, the permanent magnets are used in manufacturing synchronous motors which are largely manufactured from rare earth elements.

However, China plays a significant role in a quasi-monopolist in the international rare earth market which accounts for more than 90% of the supply. India is highly dependent for imports for these resources, their procurement will have a significant impact on the exchequer.

Estimating materials requirement for electric vehicles in India 

The body of an electric vehicle is mostly made up of steel, but to make vehicles lighter in weight, many light-weighting materials are also used that include aluminium, plastics, synthetics and rubber among other materials.

The drive motor system is an important element of EVs as it converts electrical energy into mechanical energy. This consists of an electric motor, inverter, converter, power distribution unit (PDU), and a charger.

The traction batteries are those that are used for the propulsion of any type of electric vehicle are mostly nickel-metal hydride (NiMH) or Lithium-Ion (LIB) type. But lithium is the lightest solid element and provides the highest oxidation potential, it carries higher energy density compared to the standard lead-acid and NiMH batteries for which it is mostly preferred material among battery manufacturers.

With the number of EVs manufactured domestically in the coming years, the production and the consumption of materials rate will go up in India. 

(source European Union’s Resource Efficiency Initiative (EU-REI))

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