Batteries included: US bets on Li-ion technology for green jobs

C&I Issue 16, 2009

The US has made a major push to become a serious player in lithiumion batteries for hybrid and electric vehicles, by doling out a series of grants totalling $2.4bn. The grants are part of US President Obama’s plan to move the US economy away from fossil fuels and create thousands of ‘green’ jobs. ‘If we want to reduce our dependence on oil, put Americans back to work and reassert our manufacturing sector as one of the greatest in the world, we must produce the advanced, efficient vehicles of the future,’ said President Obama.

The grants, which are part of the American Recovery & Reinvestment Act, breakdown into three areas: $1.5bn will go to US-based manufacturers to produce a range of batteries, including lithium-ion, and their components, as well as expanding battery recycling; $500m for battery producers to produce electric vehicle drive components; and $400m to buy and test electric and hybrid vehicles and provide workforce training.

Benny Daniel, a consultant for Frost & Sullivan, says that this push to develop battery manufacturing capacity in the US is all about energy independence. ‘The US doesn’t want Chinese manufacturers dictating the price [of batteries],’ he says. Increasing the manufacturing base for lithium-ion electric and hybrid vehicle batteries could rapidly bring the price down. Daniel predicts that costs per cell could fall by as much as 70% by 2015.

Amongst the recipients of the grants are several chemical companies, including BASF Catalysts, Dow Kokam and Honeywell. Dow Kokam is a joint venture between US chemical giant Dow, Korean lithium battery producer Kokam and Townsend Ventures, the sustainable energy division of investment firm Townsend Capital. The joint venture will receive a $161m grant to produce manganese oxide cathode lithium-ion batteries for hybrid and electric vehicles, with plans for a facility, slated to begin production in 2011, which will produce 600,000 cells/year. Honeywell received a $23.3m grant to produce lithium hexafluorophosphate electrolyte salts for lithium-ion batteries.

Daniel says that these grants tackle three problems: the cost of batteries/ kWh, additional research into lithiumion solutions and creating a strong manufacturing base for batteries. ‘The way forward will be the chemical solution,’ he says. ‘If you look at battery development it is limited by the periodic table – there’s only so many elements to play with. Nanotech can help improve this.’

The allocation of grants coincides with the unveiling of Chevrolet’s Volt (pictured), a hybrid that it is claimed will achieve an impressive city driving fuel economy of 230 mpg. However, this fuel economy figure is based on the fact that the Volt can drive around 40 miles on its lithium-ion batteries before needing to dip into its petrol fuel tank.

Ying Wu, senior analyst at Lux Research, says: ‘So far this year, battery companies have raised over $600m in venture capital, which is already a huge increase over the $478m invested in 2008.’ Lux Research predicts that the market for advanced battery technologies for electric vehicles, the power grid and other uses will grow to $60bn by 2013.

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