ACJC_H2_ECONS_P1_Case_Study_Q1_Answers

1    ©ACJC2018_H2Prelims_EC9757/01_suggested answers      Answer all questions. Question 1: The Rise of Electric Vehicles Figure 1: Global price of lithium-ion battery (US$/kilowatt hour) Source: Bloomberg New Energy Finance, accessed 5 July 2018 Figure 2: 2018 Lithium-ion battery global market share (%) Source: Statista, accessed 5 July 2018 Extract 1: Technology is fuelling the use of cobalt Cobalt is a hard, shiny and greyish metal which has many strategic and irreplaceable industrial uses as a result of its unique properties. Currently used in numerous industrial chemical processes, close to half of the world’s cobalt supplied today is used in lithium-ion batteries, putting it at the heart of the drive for alternative and renewable energy systems. There has not been a good substitute to make lithium-ion batteries without the mineral. In 2017, lithium-ion batteries used in portable consumer electronics took up around 72% of total cobalt used in lithium-ion batteries. Each new electric vehicle, which runs on lithium-ion battery, uses about 10 kg of cobalt. Panasonic Sanyo BYD LG Chem Samsung Wanxiang GS Yuasa Lishen 1000 800 600 400 200 0 2010 2011 2012 2013 2014 2015 2016  33  18 17  9   5   3   3

2    ©ACJC2018_H2Prelims_EC9757/01_suggested answers      In recent years, electric cars have knocked diesel off its perch as the fuel with the smallest carbon footprint. Diesel also releases greater quantities of nasty gases other than carbon, such as nitrogen oxides, than petrol does. Many cities in Europe and the rest of the world want to eliminate diesel cars from their roads as early as 2025. Governments hope that the void left by diesel will be filled by zero-emission battery-powered models. But mass adoption of such vehicles, which for now are expensive and have limited ranges, still appears a way off. Sources: https://www.dartoncommodities.co.uk/ (accessed on 21 July 2018) and The Economist, 13 February 2018 Extract 2: Charging ahead, China’s dirty race for clean vehicles After a decade of halting progress, electric cars are zooming ahead in China. Last year the number of registrations of new electric vehicles (EVs) in the country overtook that in America, making it the world’s biggest and fastest growing market. The category includes electric-only cars as well as plug-in hybrids that can also run on petrol. Analysts expect the market to grow by nearly 50% a year for the rest of this decade. The government has had a big role in the marked expansion of EVs in China. It doles out generous subsidies to local makers, to parts suppliers and to those who buy the final products. Last year alone, China shovelled over 90