KUALA LUMPUR (March 23): Global cumulative lithium-ion battery capacity could rise over fivefold to 5,500 gigawatt-hours (GWh) between 2021 and 2030, said energy research and consultancy Wood Mackenzie (WoodMac).

In a statement on Tuesday (March 22), the firm said the Asia-Pacific region, led by China, accounted for 90% of the world’s battery manufacturing in 2021.

It said by the end of the decade, the region is expected to reduce its share to 69%. While North America’s cell capacity could expand 10-fold by 2030, it still lags behind Europe which is on track to overtake North America in 2022 and will account for over 20% of global capacity by 2030 through more rapid expansion.

WoodMac consultant Jiayue Zheng said the electric vehicle (EV) market accounts for almost 80% of lithium-ion battery demand.

“High oil prices are supporting more markets to roll out zero-emission transportation policies, causing demand for lithium-ion batteries to skyrocket and [would] exceed 3,000 GWh by 2030,” said Zheng.

He said the lithium-ion battery market already encountered shortages last year due to thriving EV market demand and rising raw material prices.

“Under our base-case scenario, we project that battery supply will not meet demand until 2023,” he said.

WoodMac said global battery manufacturers are responding with massive expansion plans, taking total capacity to more than 5,500 GWh by 2030 across 300 manufacturing facilities.

It said among them, Chinese manufacturers had announced plans to build more than 3,000 GWh of capacity to date.

The top 15 manufacturers by planned capacity put into operation a total of about 200 GWh in 2021, and the cumulative capacity reached 600 GWh.

Meanwhile, 3,000 GWh of capacity is in the planning or construction stage. CATL leads the expansion with an outstanding operating and planned capacity of 800 GWh in total by 2030.

Chinese battery manufacturers such as SVOLT, CALB and Gotion High-Tech also have ambitious 2025 capacity targets.

WoodMac said it expects many more new plant announcements in 2022.