After electric cars, what more will it take for batteries to change the face of energy?
About three-quarters of the way along one of the snaking production lines in Nissan’s Sunderland plant, a worker bolts fuel tanks into the chassis of countless Qashqais— the “urban crossover” SUVs which are the bulk of the factory’s output. But every so often something else passes along the line: an electric vehicle called a Leaf. The fueltank bolter changes his rhythm to add a set of lithium-ion battery packs to the floor of the Leaf. His movements are so well choreographed with the swishing robotic arms around him that he makes the shift from the internal combustion engine to the battery-charged electric vehicle look almost seamless.
Until recently, it was a transition that many found unthinkable. The internal combustion engine has been the main way of powering vehicles on land and at sea for most of the past century. That is quite the head start. Though Leafs are the world’s biggest-selling electric vehicle, the Sunderland plant, Britain’s biggest car factory, only made 17,500 of them last year. It made 310,000 Qashqais. And the Qashqais, unlike the Leafs, were profitable. Nissan has so far lost money on every Leaf it has made.
There were 750,000 electric vehicles sold worldwide last year, less than 1% of the new-car market. In 2011 Carlos Ghosn, boss of the Renault-Nissan alliance, suggested that his two companies alone would be selling twice that number by 2016, one of many boosterish predictions that have proved well wide of the mark. But if the timing of their take-off has proved uncertain, the belief that electric vehicles are going to be a big business very soon is ever more widely held. Mass-market vehicles with driving ranges close to that offered by a full tank of petrol, such as Tesla’s Model 3 and GM’s Chevrolet Bolt, have recently hit the market; a revamped Leaf will be unveiled in September. The ability to make such cars on the same production lines as fossil-fuel burners, as in Sunderland, means that they can spread more easily through the industry as production ramps up.
ALL WE NEED TO LIVE TODAY
Many forecasters reckon that the lifetime costs of owning and driving an electric car will be comparable to those for a fuel burner within a few years, leading sales of the electric cars to soar in the 2020s and to claim the majority sometime during the 2030s. China, which accounted for roughly half the electric vehicles sold last year, wants to see 2m electric and plug-in hybrid cars on its roads by 2020, and 7m within a decade. Bloomberg New Energy Finance (BNEF), a consultancy, notes that forecasts from oil companies have a lot more electric vehicles in them than they did a few years ago; OPEC now expects 266m such vehicles to be on the street by 2040 (see The coming oil crisis). Britain and France have both said that, by that time, new cars completely reliant on internal combustion engines will be illegal.
That this is even conceivable is a tribute to the remarkable expansion of the lithium-ion battery business—and to the belief that it is set to get much bigger. The first such batteries went on sale just 26 years ago, in Sony’s CCD-TR1 camcorder. The product was a hit: the batteries even more so, spreading to computers, phones, cordless power tools, e-cigarettes and beyond. The more gadgets the world has become hooked on, the more lithium-ion batteries it has needed. Last year consumer products accounted for the production of lithium-ion batteries with a total storage capacity of about 45 gigawatt-hours (GWh). To put that in context, if all those batteries were charged up they could provide Britain, which uses on average about 34GW of electricity, with about an hour and 20 minutes of juice.
In the same year production of lithium-ion batteries for electric vehicles reached just over half that capacity: 25GWh. But Sam Jaffe of Cairn ERA, a battery consultancy, expects demand for vehicle batteries to overtake that from consumer electronics as early as next year, marking a pivotal moment for the industry. Huge expansion is under way. The top five manufacturers—Japan’s Panasonic, South Korea’s LG Chem and Samsung SDI, and China’s BYD and CATL—are ramping up capital expenditure with a view to almost tripling capacity by 2020 (see Electric dreams). The vast $5bn gigafactory Tesla is building with Panasonic in Nevada is thought to already be producing about 4GWh a year. Tesla says it will produce 35GWh in 2018. Just four years ago, that would have been enough for all applications across the whole world.
The gigafactory is not just for cars. Hearing of electricity blackouts in South Australia, Elon Musk, Tesla’s founder, tweeted to the state’s premier in March that by the end of the year Tesla could provide enough battery storage to make sure that the grid never fell over again. At the gigafactory they are now hard at work cramming 129 megawatt-hours (MWh) of capacity into a facility designed to keep their boss’s word. When installed on the other side of the Pacific, it will be the biggest such grid-based system in the world; but many more are on the way. Industrialscale lithium-ion battery packs—essentially lots of the battery packs used in cars wired together, their chemistry and electronics tweaked to support quicker charging and discharging—are increasingly popular with grid operators looking for ways to smooth out the effects of intermittent power supplies such as solar and wind. Smaller battery packs are being bought by consumers who want independence from the grid—or, indeed, to store the electricity they produce for themselves so that it can be sold into the grid at the most lucrative time of day or night. Batteries are becoming an integral part of the low-emissions future.
THE CHANCE TO CHANGE
The fundamental operating principles of the lithiumion battery are easily understood. When the battery is charging an electric potential pulls lithium ions into the recesses of a graphite-based electrode; when it is in use these ions migrate back through a liquid electrolyte to a much more complex electrode made of compounds containing lithium and other metals—the cathode. The fundamental operating principles of the battery business, on the other hand, are considerably more opaque, thanks to an almost paranoid taste for secrecy among suppliers and the baffling economics of the Asian conglomerates that lead the market.
All the big producers are adding capacity in part because it drives down unit costs, as the past few years have shown (see Watt next?). Lithium-ion cells (the basic components of batteries) cost over $1,000 a kilowatt-hour (kWh) in 2010; last year they were in the $130-200 range. GM says it is paying $145 per kWh to LG Chem for the cells that make up the 60kWh battery for the Bolt (the pack, thanks to labour, materials and electronics, costs more than the sum of its cells). Tesla says that cells for the Model 3 are cheaper. Lower costs are not the only improvements; large amounts of R&D investment have led to better power density (more storage per kilogram) and better durability (more discharge-then-recharge cycles). The Bolt comes with a battery warranty of eight years.
There were 750,000 electric vehicles sold worldwide last year, less than 1% of the new-car market. But if the timing of their take-off has proved uncertain, the belief that electric vehicles are going to be a big business very soon is ever more widely held