As the negative effects of climate change and the burning of fossil fuels on the planet become apparent - along with the subsequent cost to human health - governments around the world are developing policy changes to combat these effects. The focus on the acceleration of action towards the goals of the Paris Agreement, and the UN Framework Convention on Climate Change at the COP26 conference, means that countries are coming forward with ambitious emissions-reduction targets that align with reaching net-zero by the middle of the century.
Environmental and health responsibility
At the forefront of this change is the phasing out of the internal combustion engine, especially in the automotive sector. As an example of this trend, Volvo has announced that it will only make electric vehicles by 2030 and that it is phasing out the production of all cars with internal combustion engines, including hybrids. This is now a virtually global movement. National and municipal authorities are using their powers to restrict, or even phase out, the use of internal combustion engine cars. In March 2021, the UK government announced that new diesel and petrol cars will no longer be on sale after 2030.
Electric vehicles reaching price and performance parity with the internal combustion engine is seen as the key milestone in the world’s energy transition. It is expected that this cost parity, when combined with the lower total cost of ownership of electric vehicles, will trigger exponential growth in battery electric vehicle sales. All automotive manufacturers are intending to switch production to electric vehicles in the short, medium and longer terms. This would naturally be dependent on the regular and sector supply of battery metals, of which more would have to be extracted and/or recycled.
In 2021, battery costs are 80% lower than 2010 levels, making battery storage a more cost-effective solution to the problem of renewables’ reliability. As batteries become cheaper still, we expect them to make deep inroads across the world.
The serious environmental consequences of burning fossil fuels - coupled with the need to deliver a battery industry that can precipitate the transition away from internal combustion engine cars - are the main drivers behind our passion to develop a UK listed, sustainable circular economy for battery metals.
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