Electric vehicles are expected to grab significant market share from gasoline-powered automobiles over the next decade, accounting for an estimated 34% of light-duty sales in the U.S. and 28% worldwide by 2030, Bloomberg New Energy Finance said May 21. Raw material shortages and a lack of charging stations, however, could slow that progress.
Propelled by falling battery costs and large-scale manufacturing, the shift toward electric cars and buses is projected to increase global electricity demand by 6% in 2040 while displacing 7.3 million barrels of transport fuel per day, Bloomberg New Energy Finance said. But two big uncertainties loom: whether a shortage of cobalt, a key metal for advanced batteries, will slow down the pace of battery cost declines, and whether countries will build enough charging infrastructure to accommodate the transition.
Cobalt, which is chiefly mined in the Democratic Republic of the Congo, represents "one of the largest potential risks" to electric vehicle sales over the next five to seven years, Bloomberg New Energy Finance said, adding that, over the longer term, higher prices should encourage the development of additional supplies and hasten the adoption of new battery chemistries.
The U.S. Department of the Interior recently included cobalt and lithium, another important battery ingredient, on a list of 35 minerals it considers critical to the country's economy and national security. The U.S. has an estimated 1 million tons of identified cobalt reserves, most of which are located in Minnesota, according to the U.S. Geological Survey.
Bloomberg New Energy Finance said its market projections were bolstered over the past year by automakers' plans to introduce new models of electric vehicles and by regulations aimed at cutting pollution in urban areas. The firm expects electric vehicle sales to grow to 30 million in 2030 from 1.1 million in 2017 as prices for electric vehicles continue to fall. The bus market is expected to transition even faster, with electric buses projected to have a lower total cost of ownership than conventional municipal buses by 2019, Bloomberg New Energy Finance said.
"China has led this market in spectacular style, accounting for 99% of the world total last year," Colin McKerracher, lead advanced transportation analyst at Bloomberg New Energy Finance, said in a news release. "The rest of the world will follow, and by 2040 we expect 80% of the global municipal bus fleet to be electric."