Global lithium demand could exceed 13 million tonnes by 2050: WoodMac

Mumbai: Global lithium demand could exceed 13 million tonnes by 2050 under an accelerated energy transition, more than double base case projections, according to Wood Mackenzie’s (WoodMac) latest Energy Transition Outlook for Lithium. 

Without significant new investment, supply deficits could emerge as early as 2028. 

Even under the Wood Mackenzie’s base case scenario, existing supply projects are unlikely to meet demand beyond the mid-2030s, highlighting the need for sustained investment across the value chain. 

Wood Mackenzie is a global insight business for renewables, energy and natural resources.

“The lithium market is heading into a supply crunch much sooner than many industry players expect,” said Allan Pedersen, Research Director at Wood Mackenzie. “Under ambitious climate scenarios, we see deficits emerging from 2028. The industry needs to act now should governments progress policies towards Net Zero. Projects approved today will determine market balance in the critical 2030s,” he said in a press statement.

Electric vehicles (EVs) remain the primary driver of demand growth, accounting for 72–80 per cent of lithium consumption across scenarios. EV penetration may reach approximately 75 per cent by 2040 under the Country Pledges scenario and 95 per cent under the Net Zero scenario. 

The report also noted that rechargeable batteries across all applications account for 96–98 per cent of lithium consumption by mid-century. 

“EVs remain the primary driver of lithium demand growth, but energy storage systems (ESS) are the sleeper story,” said Rebecca Grant, Senior Research Analyst at Wood Mackenzie. “ESS demand grows at 6-7 per cent annually in our forward scenarios as renewables dominate new power capacity and grids require flexibility at scale,” she added. 

Across all scenarios, one conclusion is consistent: lithium is irreplaceable for the energy transition, and the industry faces structural supply challenges that require immediate action. “Whether we're on a 1.5°C pathway or something less ambitious, lithium demand will outstrip current supply plans,” said Pedersen.

He concluded saying, “The question isn't whether we need more lithium. It's whether the industry can mobilise capital fast enough to meet demand while navigating an increasingly fragmented global trade environment.”