Lithium-ion batteries dominate the electric vehicle (EV) battery market. The lithium nickel manganese cobalt oxide (NMC) chemistry accounts for 60% of the total market, according to a 2023 report by the International Energy Agency. The second most popular, lithium iron phosphate (LFP), represents 30%, and nickel cobalt aluminium oxide (NCA) holds an 8% share.
While lithium NMC in particular has proven itself to be a performative solution, its supply chain has considerable sustainability issues. The mining activities associated with lithium, nickel, cobalt, and graphite have been widely criticised for their negative ESG profile, such as polluting water, killing wildlife, contaminating crops, and displacing indigenous populations. Unrecycled batteries that end up in landfill can also leach some of these metals into local water supplies.
For batteries with an NMC cathode, McKinsey & Co estimates that lithium-ion materials account for 40-60% of total EV production emissions. In the long term, creating a more sustainable battery supply chain may depend on research into new compositions and alternative chemistries.
