In the international mobility summit, MOVE, held in Delhi on
7th and 8th September, Shri Amitabh Kanth, CEO of Niti
Aayog, talked about how prices of Li Ion batteries for Electric Vehicles have
been falling rapidly over the last five years and is currently at $200 per kWh
(at the pack-level). He further predicted that this would fall to $100 per kWh
in next seven to eight years and then to as low as $70 per kWh by 2030. What is
behind this rapidly falling Li-Ion battery prices?
The battery is made of Li-Ion cells, which contributes to
70% of the costs. The rest is Battery Management System (BMS) and the mechanical
and thermal packaging. The BMS is made of electronic components, prices of
which are known to fall with volumes and time. But why are the cell prices
falling? The cells itself constitute of materials like Lithium, Manganese,
Cobalt, Nickle and Graphite and the materials contribute to 70% of cell-price.
But the costs of these materials are not falling down as rapidly and in fact
hardening in the last few years. Then why do the cell price fall?
The simple reason is the R&D contribution to less
materials being used per kWh of battery-cells. As less and less materials is
used to make cells of the same size, the prices fall. It all boils down to the
specific energy density of the cells, measured in terms of Watt-hour per
Kilogram (Wh/kg). As more and more Watt-hours can be produced using one kg of
the material, the costs come down. Not too long ago, the specific energy
density was as low as 50 Wh/kg for Li Ion cells. As it went up to 70 Wh/kg to
100 Wh/kg and then to 130 Wh/kg, the prices tumbled. The prices further went
down as we reached 150 to 160 Wh/kg and again as it reached 200 Wh/kg. What Amitabh Kanth was referring to today’s
batteries which are made out of cells with specific energy of 200 Wh/kg, he was
referring to prices further going down as the latest cells out of production is
touching 240 Wh/kg. In future we will get cells at 270 Wh/kg and hopefully, by
2020 at 300 Wh/kg. Prices of Li Ion battery will further fall. One dreams of
this number crossing 500 Wh/kg someday.
Not only the specific energy density of cells is increasing
over time, at the same time, volumetric energy density or Watt-hour per litre
(Wh/litre) is also increasing proportionately. Each time one is increasing the
specific energy density, one is packing more and more energy in smaller and
smaller volume, almost like a bomb. This would indeed raise safety concerns and
one has to do utmost to ensure that this high energy-density, high volumetric
density, low cost cells are safe. R&D has been continuously going on to
enhance safety of higher energy-density cells. New techniques have to evolve to
make it safer.
How does R&D enhance specific energy-density?
The energy-density is enhanced by continuously playing with
cathode, anode and electrolyte chemistries.
For instance, Lithium Ferrous Phosphate or LFP (LiFePO4) was used as
Cathode in the most popular chemistry used in China for some time. Its specific
energy density went up from 100 Wh/kg to 120 Wh/kg and then to 130 Wh/kg,
helping the prices to fall. But soon it was learned that LFP has a theoretical
maximum specific energy-density of 160 Wh/kg. So the progress from then on will
be slow and saturate. Prices would no longer come down. It is at this point,
attention started on NMC (LiNix MnyCozO2)
as cathode, whereas the anode remained as Graphite. This chemistry did not have
such limit to the specific energy-density. It soon crossed 160 Wh/kg and then
touched 200 Wh/kg. One concern for this battery was high Cobalt cost, as its
usage increased, and the material had limited availability in the world.
Researchers started varying the x-y-z in the formulation LiNix MnyCozO2;
it started with x:y:z being 1:1:1, but then became 4:3:3, just to reduce
Cobalt. This also helped improve specific energy-density. Next was to move to
5:3:2 reducing cobalt further and then to 6:2:2, which helped enhance specific
energy-density. Right now, manufacturers are trying to produce 8:1:1, further
reducing Cobalt.
At the same time, to further enhance specific-energy and thereby
reduce costs, work has started to add Silicon to Graphite electrode and to have
Nickle rich-NMC as cathode, further reducing Cobalt. One is also researching
with other chemistries which could enhance safety, while increasing
specific-energy density. The figure[1] here captures the
capability of different battery-chemistry in terms of specific and volumetric
energy-density.
Do the costs of cells increase as materials change?
The R&D in battery chemistry aims at reducing costs and
enhance safety. Increasing specific energy-density has been found a best means
to reduce costs. But researchers always look out for costs of different
materials. They would aim to reduce costly material while enhancing specific
energy (as has been done to reduce Cobalt in NMC-Graphite battery). It is
therefore the specific energy-density becomes a good benchmark for the costs[2]. For the same costs, an
attempt will be made to increase the life-cycles, the maximum C-rate (charging
and discharging rate) which would not impact life-cycles appreciably and
enhance temperature range in which the battery could operate without impacting
life-cycles. Note that cost reduction happens along with making cells lighter
and smaller, all of which is good for Electric Vehicles.
Is material costs sole-determinant of cell costs?
Not entirely. When a new chemistry emerges (for example
NMC811), it would be costlier even though lesser Cobalt and less overall
materials are used per kWh of the cell. Initially, the R&D costs will be
loaded on the cell costs and the new and lighter cell may be more expensive
than mass-produced heavier cells. But as the volume increases, it is the
material costs that determine the cell-costs, with materials being about 70% of
the cell-costs.
Similarly, the cells with lower specific energy may be
inherently safer, but would be costly and would have no future path. That is
the reason that LFP chemistry like LFP and LMO is being discontinued, even
though there are companies which have LFP plants and would like to push it in
naïve markets that do not understand. World has moved to higher specific
energy-density cells like NMC-Graphite today and looking for future cells with
solid-state electrolytes, which are still in R&D state.
Conclusion
To Conclude, Amitabh Kanth’s prophecy of $70 per kWh for
battery prices in future, may indeed come true, if we focus on battery
chemistry, which gives higher and higher specific energy density and volumetric
energy density. These will also make cells lighter and smaller in size, which
would be ideal for Electric Vehicles. India is a large market for cells. We
should manufacture NMC-Graphite cells in high volumes today. R&D needs to
be pursued so that we can come up with higher specific-energy density and safe
cells tomorrow. The growth of EVs in India will depend upon it.
[1]
The figure borrowed from PAN-IIT presentation on Solid-State Batteries for EV
[2]
One can note from the figure that LTO cells, which has NMC as Cathode and
Lithium Titanite (Li4Ti5O12) as anode, has
poor specific energy density today. No wonder it costs three to four times the
NMC-Graphite cells. The good part of these cells is that it can be easily charged-discharged
at 10C rate (implying that the battery can be fully charged in about six
minutes) and have 10,000 charge-discharge cycles. They are also much less
impacted by higher temperature and are safe (as they carry less and less energy
per kg). R&D is going on to improve the energy-density. They may be of
select use, when very small battery is used and charged very frequently
(multiple times per day). The super-capacitors base batteries, will also fall
in this class.
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