Jan 19 2010

The Case for Electric Vehicles - Part II

Posted by: Jonathan Marshall

Sometimes the biggest blow to a new technology isn't an engineering glitch but a seemingly authoritative report proving its time hasn't come. That's exactly what happened last month, when a team of experts from the National Research Council declared that sky-high battery costs will doom plug-in electric vehicles to irrelevance for years to come.

It doesn't happen often, but the NRC experts appear to be flat wrong, according to evidence of actual battery costs compiled by CalCars and the Electrification Coalition.

"Real-world information is already a step ahead of their assumptions," CalCars claims. "Battery and auto manufacturers would not be spending tens of billions of dollars on factories to support over a dozen new plug-in vehicle models unless they saw a long-term path to low-cost, competitive components."

At the heart of the NRC's critique was the claim that battery packs today cost more than $1,000/kilowatt-hour, and that it will take a decade of engineering and production innovation to slash costs to the $400/kWh needed to make plug-in vehicles affordable to the mass market.

The truth about battery costs is closely held by manufacturers, but CalCars cites a study prepared last year by experts from the Department of Energy and Argonne National Laboratory, estimating that batteries should cost only about $300/kWh in mass production, and less than double that in modest runs of about 10,000 per year.

General Motors officials have leaked data to the media suggesting that the cost of batteries for the new Volt hybrid will be in the range of $500/kWh to $600/kWh, and will likely fall to only $300 by 2015.  A company spokesman specifically refuted the NRC's estimate of battery costs as "bloated." He added, 'Our starting point, which already costs much less than they estimate, is just the first step.'

Bottom line: as battery makers and electric vehicle manufacturers begin production, costs will indeed be high, as they were originally for personal computers, flat screen TVs, and most other new technologies. But as affluent early adopters and government subsidies create a growing market, prices should fall quickly to make these clean vehicles a strong contender in the marketplace.

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