Along with automakers, battery producers are intrigued over where demand for electric cars will go next and what materials will end up in the batteries.

“We identified electric vehicles as an area where we are at an inflection point for demand,” said Duncan Goodwin, portfolio manager of the Baring Global Resources Fund, which has investments in two major lithium producers.

While electric cars are the theme of the Paris Motor Show, producers of lithium and other metals used in battery packs are quite curious whether demand will be strong enough to rise well above the level of sales being seen worldwide, according to coverage in Reuters. Automakers have been hit hard by the Volkswagen “Dieselgate” scandal, increasing government mandates, and the race for the best 200-plus mile per charge electric cars. Having advanced, lighter, and more affordable, batteries is a key element of making all of it work.

The International Energy Agency reported that there were more than one million hybrids and PEVs on roads worldwide last year, a small token of the total global fleet size. IHS Automotive predicts the number of PEVs on roads around the world will jump from about 14,000 in 2010 to 3.9 million by 2020, so the demand is expected to be there.

Most electric car batteries currently on the market use lithium nickel manganese cobalt oxide (NMC) cathodes and graphite anodes. China has played a sizable role in the supply and pricing of “rare earth” metals typically used in electric car batteries. These metals include dysprosium, neodymium, and terbium, and are chiefly mined in China by companies including Xiamen Tungsten and China Minmetals Rare Earth Co.

The question become, what metals will be tapped into next as PEV demand grows and pricing and performance will be carefully analyzed for use in mass-market, more affordable, and longer range electric cars.

“It’s clear that electric cars from today’s point of view will have lithium ion-based batteries,” said Horst Friedrich, director of Germany’s Institute of Vehicle Concepts. “We’re talking about lithium, and… metals like cobalt, iron phosphate, rare earth elements.”

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Limited supply of battery-grade lithium is becoming a challenge for battery producers and their automotive clients. China, which has been the world’s largest lithium supplier, had prices for battery grade lithium surge to above $20,000 a ton this summer, nearly three times higher this year, as overall demand grew. China dominates the global supply for graphite used in anodes.

“The more forward-looking manufacturers are rightly becoming concerned about long term supply,” said CEO Jamie Deith of Canada’s Eagle Graphite. “Not only is there the question of producing enough graphite, but the fact that China accounts for 100 percent of natural graphite anodes today is an additional concern.”

Another element in batteries, cobalt, is expected to see big price increases. Prices are up 16 percent this year and could rise another 45 percent by 2020, according to Reuters.

Battery producers are looking at other markets to increase supply and bring down cost. Mining is becoming an increasingly lucrative business in what the industry calls the “Lithium triangle” in Chile, Argentina, and Bolivia.

Australia’s Lithium Power International is preparing to ship lithium from northern Chile to directly to China for use in PEVs. The company is aiming to be in production by 2019-2020.

Another Australian company, Orocobre, has nearly completed a scoping study with the aim of at least doubling production capacity over the next two years at a facility in Argentina. Chile’s SQM announced this month that it was investing $30 million to boost its lithium hydroxide capacity by 7,500 tons.

“The market penetration of electric vehicles in the automotive market will have a significant impact on lithium demand,” the company said.

While lithium ion is the mainstay ingredient in PEVs on the market today, battery makers are carefully watching the market for affordable, efficient, and durable technologies to come forward. A recent study by Navigant Research said that lithium sulfur, lithium solid-state, next-generation flow, and a liquid metal battery are at the level of laboratory-scale research or pilot-scale production levels today and hold the most hope for the future.

Availability and price of the metals needed for these and other batteries are a key benchmark on what technologies will win the race. Metals such as nickel, cobalt and manganese may not be needed in batteries such as the lithium sulfur battery being developed by British company Oxis Energy, according to Reuters.

Developing any of the new battery technologies to the point where they can be commercialized takes time. As for now, lithium is winning out.

“We consider the risk of substitution of lithium to be very low,” said CRU Group’s Julia Ralph.