A new Obama administration report predicts a sharp decline in the cost of hybrid-electric vehicle batteries over the next three years, but industry analysts are calling that forecast optimistic.
"The Blueprint for a Secure Energy Future: A Progress Report" says battery pack costs could drop as low as $360/kWh by 2015:
In 2008, a typical battery for a plug-in hybrid electric vehicle with a 40-mile electric range cost $12,000 (assumes 10kWh batteries). But in part because of the investments made by the Administration, the United States is on track to demonstrate technology by 2015 that would reduce the cost to $3,600.
Such a drop could be a big step forward for the electric car market. A Chevy Volt battery would cost about $5,760, significantly less than it is believed to cost today. Similarly, a Tesla Roadster battery -- which, according to recent news reports, is being offered to customers at a replacement price of about $40,000 -- would drop to $14,400.
The government report cites investment in advanced battery research as the reason for the projected price drop. "In 2009, the US had only two factories manufacturing advanced vehicle batteries," it states. "Since then, we have supported 30 new advanced battery and electric vehicle component plants that are opening across the country."
But industry analysts questioned whether the going rate of $800-$1,000/kWh could drop that far in such a short time.
"It's very optimistic," Hrishikesh Sathawane, electric vehicle and energy storage analyst for Lux Research, told us. "A lot of cost reduction will come from economies of scale. But for economies of scale to happen, there has to be huge customer demand. And we don't see that happening."