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Written by Steven Ashley
Today"s electrochemical battery is like a latter-day philosopher"s stone just insert and inanimate objects spring to life. Nothing else in our technological arsenal can compare. But despite this bit of modern magic, everybody has a beef with batteries. Their charge runs out too soon, and takes too long to recharge; they weigh too much, etc. And when lots of lithium-ion (Li-ion) batteries are ganged together to propel an electric vehicle (EV) several hundred miles, the cost quickly becomes prohibitive. It"s little wonder then that less than 0.5% of new cars sold worldwide are plug-in vehicles. It"s also no surprise that a panel of U.S. National Research Council experts cited the high costs as well as range and recharging shortcomings of Li-ion batteries as the principal obstacles to widespread adoption of plug-in vehicles. Their 2015 report, "Overcoming Barriers to Deployment of Plug-in Electric Vehicles," warns that inadequate battery technology, if not addressed, will increasingly limit the auto industry"s profitability and long-term sustainability. Toward the $100/kW h pack, slowly Electrified vehicle planners and engineers know that battery cost is their principal impediment and the issue whose solution would go a long way toward resolving most other problems. The good news is that those costs are falling slowly but steadily, leaving the industry "on the cusp of affordability," said Cosmin Laslau, senior analyst at Lux Research, a technology and market research firm. Laslau is the lead author of an analysis titled "Crossing the Line: Li-ion Battery Cost Reduction and Its Effect on Vehicles and Stationary Storage." The study, he explained, is based on interviews with battery builders, OEMs, and government and university researchers. It also includes a detailed "bottom-up cost model" to account for the differences in battery chemistry, form factor, production scale, manufacturing locations and other issues when assessing forthcoming battery technology and future prices. The Lux report estimates that by 2025, Li-ion EV battery pack prices from a leading manufacturer such as Panasonic should fall to $172 kW h, while the "laggard manufacturers" should achieve pack prices around $229/kW h. Most automotive packs currently cost around $400/kW h. Laslau said a $200/kW h pack price is considered to be the entry point to a large-scale EV market. EV sales would truly take off at a $100/kW h price point, according to the U.S. Advanced Battery Consortium. This scenario generally aligns with predictions by LG Chem, Bosch, GM and Tesla that battery pack prices will trend toward the $300/kW h level by 2020. If developers can drive price down to $300/kW h or less, the report stated, EV makers will have a chance to sell millions of units by the mid- to late 2020s. Bucking the "gigafactory" trend Laslau characterized the battery business as a fiercely competitive, highly secretive and strongly conservative industry with several large and long-established incumbents. Comparing their efforts is complicated by the fact the each player is taking its own particular technological path, he added. Automotive OEMs and battery builders are joining forces to scale up production to unprecedented levels in the quest for cost reduction and supply chain security, the report said. Panasonic and Tesla, for example, are pursuing economies of scale by building a colossal $5-billion, 35 GW h-capacity battery plant. The so-called "Gigafactory" in Nevada is designed to spit out cells and packs that would cost from 30% to 50% less than the incumbent industry"s current product. The Japanese company currently supplies Tesla with small, 18650-form-factor Li-ion cells featuring nickel cobalt aluminum (NCA) cathodes. These cells, over 6,000 of which power each Model S sedan, deliver a high specific energy of 250 W h/kg at a cost of $265/kW h. Meanwhile, competitors appear to trail significantly. Nissan-AESC, LG Chem and Samsung SDI currently sell cells that offer between 140 W h/kg and 170 W h/kg, and lag in energy density by a similar amount, Laslau said. Their larger prismatic and pouch-type cells are simpler to integrate and manage versus cylindrical cells, and traditionally use lithium manganese oxide (LMO) chemistries. These companies risk falling behind during the coming decade with packs costing $261/kW h unless they upgrade their production methods, he cautioned. They are now transitioning toward greater use of the more energy-dense lithium nickel manganese cobalt (NMC) family, the report stated. LG Chem, for example, is aiming at 250 W h/kg by 2017 while bucking the gigafactory" trend. The South Korean battery giant claims that meaningful cost reductions taper off after 3 to 4 GW h of production capacity. The Lux analysis in addition predicts that China"s vertically integrated BYD will achieve $211/kW h pack costs by 2025 by pushing capacities up to 8 GW h. BYD favors cells with lithium iron phosphate chemistry, which it claims is a safer, cheaper, alternative with somewhat less energy density though the cells are "tweaked to increase voltage," according to Laslau. Another big player is Boston-Power, a American/Chinese maker of "lithium cobalt" cells that offer 200 W h/kg. In December 2014 the company received $290 million in "financial support" from Chinese government agencies to scale its battery factories up to 4 GW h capacity, according to press reports. Price war brewing? Production plant location matters, Laslau noted. Cells that are made in Japan cost 15% more than those of equivalent size and identical form factor manufactured in China because of lower labor costs, cheaper materials and land, as well as a localized, efficient supply chain. Co-location also enables makers to exert more influence on suppliers to reduce costs and extract incentives from local governments. The Lux report confirmed that the cathode remains the most costly components of Li-ion batteries because they contain high-priced nickel, cobalt and lithium. For NMC pouch cells made in a 1-GW h South Korean factory, for example, the cathode accounts for about 25% of the total pack cost. The remaining costs break down as follows: battery pack management system 16%; pack thermal system 8%; anode materials 8%; depreciation of equipment 8%; cell labor 8%; land cost for cell manufacturing 6%; cell fixed costs 6%; pack labor 5%; current collectors 3%; separators 3%; and electrolytes 1%. Just how plug-in battery prices will fare over the next decade is hard to predict, Laslau said. "In 5 or 10 years we may see consolidation, with only two or three big suppliers remaining. That could mean a price war to capture market share," he noted.
Date: 14-Aug-2015 01:36 EDT
More of this article on the SAE International website
ID: 1340
Today"s electrochemical battery is like a latter-day philosopher"s stone just insert and inanimate objects spring to life. Nothing else in our technological arsenal can compare. But despite this bit of modern magic, everybody has a beef with batteries. Their charge runs out too soon, and takes too long to recharge; they weigh too much, etc. And when lots of lithium-ion (Li-ion) batteries are ganged together to propel an electric vehicle (EV) several hundred miles, the cost quickly becomes prohibitive. It"s little wonder then that less than 0.5% of new cars sold worldwide are plug-in vehicles. It"s also no surprise that a panel of U.S. National Research Council experts cited the high costs as well as range and recharging shortcomings of Li-ion batteries as the principal obstacles to widespread adoption of plug-in vehicles. Their 2015 report, "Overcoming Barriers to Deployment of Plug-in Electric Vehicles," warns that inadequate battery technology, if not addressed, will increasingly limit the auto industry"s profitability and long-term sustainability. Toward the $100/kW h pack, slowly Electrified vehicle planners and engineers know that battery cost is their principal impediment and the issue whose solution would go a long way toward resolving most other problems. The good news is that those costs are falling slowly but steadily, leaving the industry "on the cusp of affordability," said Cosmin Laslau, senior analyst at Lux Research, a technology and market research firm. Laslau is the lead author of an analysis titled "Crossing the Line: Li-ion Battery Cost Reduction and Its Effect on Vehicles and Stationary Storage." The study, he explained, is based on interviews with battery builders, OEMs, and government and university researchers. It also includes a detailed "bottom-up cost model" to account for the differences in battery chemistry, form factor, production scale, manufacturing locations and other issues when assessing forthcoming battery technology and future prices. The Lux report estimates that by 2025, Li-ion EV battery pack prices from a leading manufacturer such as Panasonic should fall to $172 kW h, while the "laggard manufacturers" should achieve pack prices around $229/kW h. Most automotive packs currently cost around $400/kW h. Laslau said a $200/kW h pack price is considered to be the entry point to a large-scale EV market. EV sales would truly take off at a $100/kW h price point, according to the U.S. Advanced Battery Consortium. This scenario generally aligns with predictions by LG Chem, Bosch, GM and Tesla that battery pack prices will trend toward the $300/kW h level by 2020. If developers can drive price down to $300/kW h or less, the report stated, EV makers will have a chance to sell millions of units by the mid- to late 2020s. Bucking the "gigafactory" trend Laslau characterized the battery business as a fiercely competitive, highly secretive and strongly conservative industry with several large and long-established incumbents. Comparing their efforts is complicated by the fact the each player is taking its own particular technological path, he added. Automotive OEMs and battery builders are joining forces to scale up production to unprecedented levels in the quest for cost reduction and supply chain security, the report said. Panasonic and Tesla, for example, are pursuing economies of scale by building a colossal $5-billion, 35 GW h-capacity battery plant. The so-called "Gigafactory" in Nevada is designed to spit out cells and packs that would cost from 30% to 50% less than the incumbent industry"s current product. The Japanese company currently supplies Tesla with small, 18650-form-factor Li-ion cells featuring nickel cobalt aluminum (NCA) cathodes. These cells, over 6,000 of which power each Model S sedan, deliver a high specific energy of 250 W h/kg at a cost of $265/kW h. Meanwhile, competitors appear to trail significantly. Nissan-AESC, LG Chem and Samsung SDI currently sell cells that offer between 140 W h/kg and 170 W h/kg, and lag in energy density by a similar amount, Laslau said. Their larger prismatic and pouch-type cells are simpler to integrate and manage versus cylindrical cells, and traditionally use lithium manganese oxide (LMO) chemistries. These companies risk falling behind during the coming decade with packs costing $261/kW h unless they upgrade their production methods, he cautioned. They are now transitioning toward greater use of the more energy-dense lithium nickel manganese cobalt (NMC) family, the report stated. LG Chem, for example, is aiming at 250 W h/kg by 2017 while bucking the gigafactory" trend. The South Korean battery giant claims that meaningful cost reductions taper off after 3 to 4 GW h of production capacity. The Lux analysis in addition predicts that China"s vertically integrated BYD will achieve $211/kW h pack costs by 2025 by pushing capacities up to 8 GW h. BYD favors cells with lithium iron phosphate chemistry, which it claims is a safer, cheaper, alternative with somewhat less energy density though the cells are "tweaked to increase voltage," according to Laslau. Another big player is Boston-Power, a American/Chinese maker of "lithium cobalt" cells that offer 200 W h/kg. In December 2014 the company received $290 million in "financial support" from Chinese government agencies to scale its battery factories up to 4 GW h capacity, according to press reports. Price war brewing? Production plant location matters, Laslau noted. Cells that are made in Japan cost 15% more than those of equivalent size and identical form factor manufactured in China because of lower labor costs, cheaper materials and land, as well as a localized, efficient supply chain. Co-location also enables makers to exert more influence on suppliers to reduce costs and extract incentives from local governments. The Lux report confirmed that the cathode remains the most costly components of Li-ion batteries because they contain high-priced nickel, cobalt and lithium. For NMC pouch cells made in a 1-GW h South Korean factory, for example, the cathode accounts for about 25% of the total pack cost. The remaining costs break down as follows: battery pack management system 16%; pack thermal system 8%; anode materials 8%; depreciation of equipment 8%; cell labor 8%; land cost for cell manufacturing 6%; cell fixed costs 6%; pack labor 5%; current collectors 3%; separators 3%; and electrolytes 1%. Just how plug-in battery prices will fare over the next decade is hard to predict, Laslau said. "In 5 or 10 years we may see consolidation, with only two or three big suppliers remaining. That could mean a price war to capture market share," he noted.
Date: 14-Aug-2015 01:36 EDT
More of this article on the SAE International website
ID: 1340
