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Electric Car Battery Makers Face Shakeup Amid Soft Demand

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Beth Stackpole
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Re: Battery Maker Shakeup Coming???
Beth Stackpole   9/9/2011 6:56:37 AM
@curious_device: In wholehearted agreement. I think that was what I was trying to say!

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Re: Home Battery pack with Time of Use
bronorb   9/9/2011 9:25:41 AM
@Ivan, you hit the nail on the head. It takes so long to get payback on this technology investment, few people will do it.

Same with hybrids and EVs. I have a 10-year old gas-hog of a pickup truck that I drive everyday. It was paid for a long time ago. Gas prices would have to get pretty high before it would be a good idea for me to replace it with a hybrid or EV.

When energy costs skyrocket (and they will) demand for batteries will increase as well.

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Lithium-ion Battery Safety
mlundheim   9/9/2011 11:35:00 AM
Nice discussion. My hope is that, when lithium-ion batteries are used in autos, that auto and battery makers, as well as consumers, demand that the batteries include a newly discovered -- but little known -- safety innovation. 

The two-tiered solution consists of a casing that surrounds the lithium-ion battery cells and a fluid that surrounds the cells. When penetrated, the casing self-seals the opening where, for example, a high-speed projectile enters the energy-storage system. The seal limits oxygen to the cells, so resulting flames can't propagate. The fluid helps disperse the heat from the individual cell to a much larger surrounding area. As a result, it prevents the initially affected cell(s) from reaching a temperature capable of triggering thermal runaway and subsequent fire and explosion. 

As a result of the innovation (discovered by Phillips Plastics), short-circuited lithium-ion batteries smolder and extinguish, rather than ignite and explode. The solution has the potential to help minimize harm to property and lives, while significantly enhancing the safety of automotive-, consumer-, and defense-related devices that run on rechargeable lithium-ion batteries. 

For more information, visit: http://phillipsplastics.com/case-studies/product-battery-safety



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Re: Lithium Battery Production costs
KingDWS   9/9/2011 12:09:37 PM
Ivan I think your ROI on the PV panels is a bit optomistic. I've been consistantly told that it is closer to 10 to 20 years for a pv roi based on current effieciencys and costs.


All in all the demand is much much softer than anticipated and you are corrct in that it sounds like the dot.com bubble and bust. I guess this is the dot.green bubble?

I think the biggest cause of the soft demand from my experiences in talking to people is simply that they don't feel these offered vehicles are a "car". They feel they need to drive and maintain them and they will not be able to use them as needed. So regaurdlesss of what the realworld experiences might prove to them typically they are afraid of chance and just not willing to take a chance. With all the over hyping on some aspects it is easy to see why.

Personally I worked on a ethanol fuel cell/ultra cap drive system. In my mind it had none of the issues of a battery powered car or even a hydrogen fuel cell powered vehicle (fuel scources and cost). What I ran across a lot was all the misinformation you see about ethanol mainly originating from the subsidies or people only familiar with older forms of production ie distilling.

I think there definitly are technologies that are here and available now that would allow the consumer to have and drive just a "car". I doubt we will ever see them until the opec gun to our heads literally runs dry and we are actually forced to do something.

/rant mode off ;-]



David McCollum
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cort of technology vs. cost of replacement
David McCollum   9/9/2011 12:35:42 PM
Like bronorb, there are many people who still find it is less expensive to keep running a less efficient device because it costs less to run it than to replace it. I have a van like his truck. . .mine still runs safely and costs me little more than gas, oil, and insurance. Replacing it would create a car payment, increased insurance and licensing costs, and many other hidden costs. I'd love an electric vehicle and many other new technologies, but the cost or replacement is not a good value for the dollar spent.

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Re: Battery Maker Shakeup Coming???
melllowfelllow   9/9/2011 2:03:19 PM
I need some help with the math. I am sometimes challenged when folks do not give me a cute table to reference. I think the numbers below are all on the low side, but since I have not seen the raw data...

1,500,000 [pessimistic hybrid number] x 10kW [avg ??] = 15gW

  300,000 [pessimistic plugin hybrids] x 12kW [avg??] = 3.6gW

  200,000 [pessimistic 'pure electric'] x 20kW [avg??] = 4gW

It would seem that the low end is around 22.6 gW and that the high end is beyond 30gW. IMO, the European and American performance and long range vehicles, plus a couple of dozen Rolls, will push the averages higher.

WRT the question "why would there be a shake up so early in the cycle??"

Many [all??] of the companies were started with borrowed money and a business plan to be profitable in 'n' years [5??]. If 10 'not yet in existence' companies [not aware of all of the other players] see the market opportunity and each believe that they can capture 20% of the TAM [Total Available Market] with 15% as the 'backup worst case' something will have to give. I would expect that early on that it would have been easy [relatively speaking] to raise VC$$. The design and manufacture of batteries is cheaper, easier, and lower risk that the design and manufacture of most technology elements [of course it always seems easier when one is not actually doing it and does not understand the details of the manufacturing process :-)

As far as I know [which is not very far], the wizards of Lux only looked at new automobile production usage. Off road vehicle, airplane, motorcycle, custom/semicustom automotive, UPS/backup power, and industrial usage was not considered. This is not a giant TAM, but it is a market of some size [??].

Any battery company worth its salt will seek out a market for its products.

WRT A123 Systems.

I find it odd that they are on the potential 'hit list'. A123 has been around a while and they already have a diverse customer and 'product usage' list. I do not know anything about their management or financials, but from afar it looks like the risk that they have is 'being dumped on by an auto manufacturer'. [ie, strung along as a potential vendor, spending $$ to setup to provide product, and then finding out that they were only being used to benchmark a cheaper far east knockoff]




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Re: High expectations
herbissimus   9/9/2011 2:35:04 PM
for the few companies that are successful at batteries, there will be a fantastic amount of money to be made, and alot of financial and technological risks to be taken by these early companies before the flow of gravy rewards the few left standing. enjoy the show. hope you all pick the winners !

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Re: Battery Maker Shakeup Coming???
cvandewater   9/9/2011 3:07:35 PM

Can you show where you got the certification that the new EV packs last on a few years? Even the old Hybrid NiMH batteries generally lasted 100k+ miles and the early data suggestes that Li-Ion batteries will last way longer, in fact most predictions are that they will outlast the life of the vehicle, so I am surprised and curious to hear who certifies EVs to need a new pack. That would be interesting data.

The study quoted here is limited to EV battery makers, but many of them have other market segments, for example for A123 the EV market is tiny - they may grow this segment, but at the moment they are very strong in power tools which is a huge market, so any nascent EV market fluctuations will hardly bother them.

Regarding grid backup power, this is indeed a very interesting area and I expect that utilities (if they have some smarts) will get into this market big time. Let me sketch some numbers to show how beneficial this market can be, even for me as consumer: ToU tariff that applies for anyone who pllans to charge an EV at their premise here in PG&E land is about 6c for off-peak, 11c for part-peak and 30c per kWh for peak usage. Peak is only applicable on weekdays half the year (May-Oct) so on average you see 5/14 times the peak/off-peak difference and 9/14 the part-peak/off-peak difference. On average this means almost 12c profit for each kWh stored at low tariff and returned at high tariff. For the PG&E tariffs, please see http://www.pge.com/tariffs/ERS.SHTML#ERS where I selected the E9 ToU tariff available to EV owners.

Now the cost: irrespective of size of the storage, the cost per kWh of battery bank is about $300 for the cells. There will be an additional cost for monitoring (BMS) and the bi-directional inverter but that is relatively minor compared to the cost of the cells as well as that the cost of cells will be lower for large volumes (this is the price in single cells). Since this kWh can earn an average 12c per day, this translates to about $44 profit per year per kWh. Now, this is when taking the inflated consumer tariffs into account. When we base it on the generator tariffs, where at many times during the night power must be burned off just to avoid under-loading the base load and where peak tariffs easily go north of 50c/kWh, then you understand how much more value such load buffering solutions can have as embedded buffers in the grid itself. Think about all the sites where a local distribution transformer is starting to overload and the utility needs to invest in putting in a heavier transformer just for the peak loads. If the buffer can not only earn back its own investment but also avoid or much delay upgrades of infrastructure then the possible gains for utilities are even much bigger.

There is another factor if you invest in a load buffer in your own home - you will be able to switch its operation from grid-tie to stand-alone, in other words: when the whole neighborhoods goes dark, your whole house stays up and running from the load bank. If necessary for days, without a noisy and smelly generator or concerns how to get gas...

The ultimate solution for the load buffer is by feeding your solar power into it, as the daily peak consumption is often later than when most of the solar power is produced. This means that your load buffer can cycle *twice* a day. First suck low priced power in the middle of the night and release it in the morning, then suck in your solar power from halfway the morning until 2 PM when the peak tariff starts and the afternoon grid load peak starts and release it again. If the grid-tie buffers become more prevalent, I am sure that it is possible to negotiate a good tariff for them, better than the usual ToU tariff, especially when they are more under utilities control, as to at what time to buffer or release their energy. I think there is a business case there, or there would not be a whole market segment of Smart Grid looking into storage, besides the obvious application of it for spreading renewable energy power availability.

William K.
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EV Battery manufacturer "shakeup"
William K.   9/9/2011 7:19:39 PM
You are correct, of course, Beth. It is quite early to say just what will be happening in 5 or 10 years. On the other side, it certainly did look like some glad talking promotors did pound a lot od sunshine, and it seems quite believeable, at least to me, that the purpose was to drive up stock prices. Not very honorable, but marginally legal. So that may have lead some investores "down a path". 

Whatever happens in the next few years certainly will be "very interesting", good, bad, or just plain ugly. But interesting for certain.

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Another thing
TimJones   9/12/2011 1:19:13 PM
Something else to consider: A lot of folks have been talking about battery exchange programs as an alternative to charging stations. There are a number of hurdles to get over in such a program, battery pack standardization probably the largest. But if an exchange scenario did play out, that would greatly increase the market for EV batteries, as the manufacturers would need to supply batteries for exchange inventory as well as for the vehicles on the road.

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