BOSTON – Early demand for electric vehicles and plug-in hybrid electric vehicles has fallen short of optimistic projections, as offerings like the Chevy Volt have missed sales targets. The key to growing this market, according to a Lux Research, will be reducing the cost of Li-ion batteries.
While larger-scale production will help reduce costs, the effect of scale-up and likely technology improvements bring nominal battery pack cost only to $397/kWh in 2020 – far short of the $150/kWh target from the U.S. Advanced Battery Consortium (USABC) and not enough to reach the mass market.
“Vehicle applications demand a different scale in both size and performance, and no other incumbent technology combines the power and energy performance of Li-ion batteries,” said Kevin See, Lux Research Analyst and the lead author of the report titled, “Searching for Innovations to Cut Li-ion Battery Costs.”
“Plug-in vehicles’ fates are tied to the cost of Li-ion batteries, so developers need to focus on the innovations that have biggest impact on cost,” he added.
To see what technologies can impact Li-ion battery cost, Lux Research studied the cost structure of Li-ion batteries, and considered the innovations that could drive disruptive decreases in cost necessary to spur growth of the electric vehicle market. Among their conclusions:
· Materials improvement and scale are insufficient to cut costs. While scale does have a significant impact in driving costs down, it is not likely to lead to a disruptive drop in battery pack costs unless coupled with other innovations.
· Cathodes remain the biggest target. Cathode capacity and voltage improvement hold much more value than anode innovation. In the optimal case, with a maximum voltage increase of 1V and capacity increase of 200 mAh/g, the nominal pack cost dropped 20 percent.
· Beyond Li-ion remains a focus. Technologies such as Li-air, Mg-ion, Li-S and solid-state batteries push past the limitations of Li-ion batteries and achieve higher energy densities and specific energies. Each technology has its supporters – PolyPlus and IBM for Li-air, Toyota for Mg-ion, Sion Power and BASF for Li-S and Sakti3 for solid-state batteries — but all face significant obstacles, Lux believes. A clear leading contender that can meet strict requirements on cycle life, power performance and manufacturability has yet to emerge.
“Searching for Innovations to Cut Li-ion Battery Costs,” is part of the Lux Research Electric Vehicles Intelligence service.
Click here to register for the complimentary Lux Research webinar, “Materials Innovation and Cost Cutting Strategies for Li-ion Batteries in Transportation,” at 11 a.m. EST on April 3.
