MIT study shows plunge in lithium-ion battery cost over the last 10 years

nanoguy

Posts: 742   +12
Staff member
Forward-looking: We often hear about new battery tech being researched -- but not released -- that could store more energy, charge faster, or last longer before its capacity deteriorates. However, it's easy to lose sight of the greater picture, where lithium-ion batteries have become significantly cheaper to produce even when compared to a decade ago.

Consumers often lament that battery technology hasn't improved at the same rate as others, like computing power which has gone up dramatically over the last few decades while batteries have only improved in relatively smaller steps. However, the biggest issue we face today is that with the proliferation of mobile devices, electric cars, and grid storage solutions, we simply can't make enough batteries to meet demand.

One factor in that equation is price, which is directly related to the materials required to make them. The most expensive of those materials go into the cathode -- lithium, nickel, manganese, and cobalt, depending on the battery chemistry. There's also the issue of longevity, which ranges from a few hundred charge cycles up to a few thousand, with no clear path to improvement unless we're willing to compromise on charging speed and energy density.

According to new analysis by MIT researchers, the overall cost of rechargeable lithium-ion batteries has fallen dramatically over the last 30 years however. It's fallen by 97 percent since the commercial introduction of the lithium-ion design, which is a comparable drop to that of the cost of photovoltaic cells used in solar panels.

But more importantly, the price decline was faster than previously estimated, which could explain why many automakers have started producing electric vehicles. Some like Volkswagen are also scrambling to build battery factories and experiment with new battery formats.

Most published work on the subject of cost reduction in lithium battery cells had typically produced conflicting results, and some didn't take into account weight and volume improvements. When adding those parameters in, the natural conclusion is that lithium-ion technology was adopted not necessarily because it was cheaper than the alternatives, but because it paved the way for portable devices, electric vehicles with an adequate driving range, and grid storage solutions for surplus solar and wind energy.

The researchers point out the findings are not just a matter of "retracing the history of battery development," but could also paint a clearer picture of its trajectory and how much potential there is to further improve and reduce the cost of lithium-ion technologies. This lends some credibility to Elon Musk's claim that the 2170 lithium-ion cells made by Panasonic for Tesla Model 3 and Model Y cars could see energy density improvements of 50 percent or higher in the next five years.

As for pricing, lithium-ion battery packs cost $1,183 per kilowatt hour in 2010, which dropped to $137 per kilowatt hour in 2020. Many analysts believe mass adoption of electric vehicles will be greatly influenced by how quickly the cost of batteries can dip below the $100 threshold.

The most optimistic view is that this could happen by 2025, when global lithium-ion battery production capacity will have tripled and price per kilowatt hour will have dropped to $93.

Permalink to story.

 

SRB

Posts: 21   +34
Yeah, but the cars don't get any cheaper. Manufactures are scrambling because they've discovered a lucrative niche market of people with deep pockets eager to "make a statement" Notice no one is
bending over backwards to make a reasonable sized $30k sedan.
 

Austinturner

Posts: 135   +135
Yeah, but the cars don't get any cheaper. Manufactures are scrambling because they've discovered a lucrative niche market of people with deep pockets eager to "make a statement" Notice no one is
bending over backwards to make a reasonable sized $30k sedan.
If you are going to start and there is a premium market, why would you start at the budget end with lower margins?

People don’t just drive electric cars to make a statement, the driving experience of the Tesla model 3 for example is really good, far better than other petrol cars in its price category.
 

Mr Majestyk

Posts: 682   +586
And yet a Tesla Powerall 2 still costs about $14K in Australia, making home batteries for solar storage totally uneconomical.
 

mbk34

Posts: 153   +89
It takes an MIT study to chart $/KWh over time??? Maybe I should put myself in for a fellowship as I did the household budget last week.
 

neeyik

Posts: 1,839   +2,151
Staff member
It takes an MIT study to chart $/KWh over time??? Maybe I should put myself in for a fellowship as I did the household budget last week.
The study looked at more than just $/kWh improvements - you can read it here.
 

mbk34

Posts: 153   +89
The study looked at more than just $/kWh improvements - you can read it here.
Thanks for the link. I ride electric unicycles (EUC) which can contain fairly large ~3KWh batteries. I'll admit we have to pay far more (10x) than the price above for our battery packs. Unfortunately if any cell goes bad then we're stuck with having to replace the whole pack (a costly exercise). Worse, if any cells start to go bad then there's a moderate fire risk as well. There is no reporting of battery condition either so a rider is unaware of a problem until it's too late. Balancing within the packs is also very primitive. The batteries themselves may have become cheaper but the engineering around the packs they come in leaves a lot to be desired.
 

SRB

Posts: 21   +34
If you are going to start and there is a premium market, why would you start at the budget end with lower margins?

People don’t just drive electric cars to make a statement, the driving experience of the Tesla model 3 for example is really good, far better than other petrol cars in its price category.
If it were new, that would be one thing...it was a 10 year study. The market is awash with high dollar electric cars. The point isn't which market do you go after, the point is that at this rate, they'll stay niche.

Today's markets are just weird, it's not about making the most money, it's about the highest profit percentage. Let's see, Tesla, Porsche, Jaguar, BMW, VW, Ford, etc. and no mass market car.
Henry Ford would never have gotten the Model T off the ground in this climate. Not ENOUGH profit.per unit, which is what matters.
 

Austinturner

Posts: 135   +135
If it were new, that would be one thing...it was a 10 year study. The market is awash with high dollar electric cars. The point isn't which market do you go after, the point is that at this rate, they'll stay niche.

Today's markets are just weird, it's not about making the most money, it's about the highest profit percentage. Let's see, Tesla, Porsche, Jaguar, BMW, VW, Ford, etc. and no mass market car.
Henry Ford would never have gotten the Model T off the ground in this climate. Not ENOUGH profit.per unit, which is what matters.
It was a 10 year study of battery prices, not the electric car market. Battery production for cars is starting to ramp up, vw is not a luxury brand and are planning to go electric scross their range.

A bit of patience is all we need.
 

toooooot

Posts: 1,462   +733
Good to see this! When we are left without a single gasoline car pumping smoke into the air we breath, it will be amazing.
Although, I imagine an explosion at the power plant which knocks out the entire plant for days.
And sudenly people desperately asking friends hoping one of the still has a gas car.
We cant transfer to electric cars without alternative sources of getting electricity.
 

Austinturner

Posts: 135   +135
Good to see this! When we are left without a single gasoline car pumping smoke into the air we breath, it will be amazing.
Although, I imagine an explosion at the power plant which knocks out the entire plant for days.
And sudenly people desperately asking friends hoping one of the still has a gas car.
We cant transfer to electric cars without alternative sources of getting electricity.
Home solar and a battery can provide an important backup for grid and power distribution issues (though they are rare in urban areas).
 

Austinturner

Posts: 135   +135
I'm NOT an environmentalist, but does anyone ever look into the impact of lithium mining, versus drilling for oil? Not only the mining, but the byproducts of the mining and the caustic waste of older disposed of batteries?

https://www.theguardian.com/news/20...te-oil-electric-vehicles-dirty-secret-lithium
We should all try to avoid damaging the environment, I don’t think we have to be crazy about it though.

Mining and oil drilling both create localised environmental impacts like land clearing, some local pollution of creeks etc but in the scheme of things their impact is pretty marginal. Oil spills can be very destructive, more than anything likely to happen from a lithium mine.
 

bexwhitt

Posts: 528   +218
And yet a Tesla Powerall 2 still costs about $14K in Australia, making home batteries for solar storage totally uneconomical.
there are plenty of other options available than tesla. My 10 kWh setup was about £3500 which is enough for me.
 

toooooot

Posts: 1,462   +733
Home solar and a battery can provide an important backup for grid and power distribution issues (though they are rare in urban areas).
But home solar requires power storage, batteries. We dont even have enough resources to make car batteries with surging demand for electric cars.
Green activists did not think this through well.
Either we find new ways to make batteries, or we will simply not have enough resources to meet the demand.
I ve read plenty articles about this issue. It seems like an issue that will be very hard to solve without new tech in batteries.