www.nanomarkets.net                                                           New Electrode Materials for                 ...
www.nanomarkets.netEntire contents copyright NanoMarkets, LC. The information contained in this report is basedon the best...
www.nanomarkets.netTable of ContentsExecutive Summary  E.1 Summary of Opportunities from New Materials for Lithium-Ion Bat...
www.nanomarkets.net  2.6 Other Lithium-Ion Battery Applications and their Impact on Electrode Material  Requirements    2....
www.nanomarkets.net   4.3 Forecast by Material   Acronyms and Abbreviations Used In this Report   About the Author        ...
www.nanomarkets.netExecutive SummaryE.1 Summary of Opportunities from New Materials for Lithium-Ion BatteriesThere are cer...
www.nanomarkets.netAs the lithium-ion battery segment expands, NanoMarkets believes that significantimprovements in perfor...
www.nanomarkets.netThese higher performing segments (EVs and Smart Grids, for example) are exactly whereNanoMarkets expect...
www.nanomarkets.netforecasting period. In our forecasts, we specifically predict the potential revenues for lithiumtitanat...
www.nanomarkets.netExhibit E-1 Firms to Watch in the Lithium Battery IndustryCompany          Technology/        Strengths...
www.nanomarkets.netOne takeaway from this Exhibit is that some very large firms are involved in this business. Theones men...
www.nanomarkets.net        E.3.1 Features Required for Competitive BenefitThese revenues will be competed for along a numb...
www.nanomarkets.netExhibit E-3 Total Value of Electrode Materials for Lithium-ion Industry by Application ($ Millions)    ...
www.nanomarkets.net                                Total Electrode Material for Lithium-ion Industry                      ...
www.nanomarkets.net      Additionally, in market segments like the electric vehicle segment, partnerships with       manu...
www.nanomarkets.netChapter One: Introduction1.1 Background to ReportLithium-ion batteries are a technology poised to see a...
www.nanomarkets.net       the expectations and needs of the market and the inability of the current industrial state      ...
www.nanomarkets.netmarket segments, it is the deciding factor between materials producers not aligning the valuepropositio...
www.nanomarkets.net       hoping to make a strong impact in the industry. While it has a longer development       timeline...
www.nanomarkets.net1.3 Methodology of this ReportThe information for this report is derived from a variety of sources, pri...
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New Electrode Materials for Lithium Ion Batteries - 2012

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Lithium ion batteries have increasingly become the workhorse power source for the consumer electronics and power tool market and they are finding new applications all the time. For example, some firms are developing lithium ion batteries for the electric vehicle (EV) market, while others seem them as a better bet than the more traditional chemical storage batteries currently used in smart electricity grids.

Within the consumer electronics and power tool sector, the market is looking for longer times between charges and quicker charging from lithium ion batteries and these performance measures will be key competitive factors going forward among the various kinds of lithium ion batteries being deployed. Elsewhere other measures – such as the cost of energy storage – will determine how well lithium ion batteries will do in sectors such as EV and smart grids.

Most of these critical factors will ultimately be determined by the materials that are chose for lithium ion batteries; especially the electrode materials used. This report examines the commercial implications of the newer materials that are being put forward for electrode materials. As the table of contents below indicates, the materials that we have covered in this report include nanostructured carbon and silicon, titanates, vanadium oxides, mixed metal oxides and a variety of lithium compounds.

This report explains the emerging requirements for battery performance in each of the main application sectors for lithium ion batteries and then shows how these translate into demand for novel electrode materials. It also analyzes the market strategies of major materials and battery firms active in this space. The report also provides the eight-year forecasts by application and material type.

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Transcript of "New Electrode Materials for Lithium Ion Batteries - 2012"

  1. 1. www.nanomarkets.net New Electrode Materials for Lithium-Ion Batteries–2012 Nano-503 Published January 2012 © NanoMarkets, LCNanoMarkets, LCPO Box 3840Glen Allen, VA 23058Tel: 804-270-1718Web: www.nanomarkets.net NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  2. 2. www.nanomarkets.netEntire contents copyright NanoMarkets, LC. The information contained in this report is basedon the best information available to us, but accuracy and completeness cannot be guaranteed.NanoMarkets, LC and its author(s) shall not stand liable for possible errors of fact or judgment.The information in this report is for the exclusive use of representative purchasing companiesand may be used only by personnel at the purchasing site per sales agreement terms.Reproduction in whole or in any part is prohibited, except with the express written permissionof NanoMarkets, LC. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  3. 3. www.nanomarkets.netTable of ContentsExecutive Summary E.1 Summary of Opportunities from New Materials for Lithium-Ion Batteries Page | i E.1.1 Lithium Cobalt Oxide (LCO) E.1.2 Lithium Manganese Oxide (LMO) E.1.3 Lithium Iron Phosphate (LFP) E.1.4 Nickel Cobalt Alumina (NCA) and Nickel Manganese Cobalt (NMC) E.1.5 Graphite and Its Replacements E.2 Materials Suppliers to Watch in this Space E.3 Roadmap for Lithium-Ion Battery Materials and Eight-Year Market Forecast E.3.1 Features Required for Competitive Benefit E.4 Concluding Remarks on Market StrategiesChapter One: Introduction 1.1 Background to Report 1.1.1 The Importance of Electrodes for Lithium Battery Performance Improvement 1.2 Objectives and Scope of this Report 1.3 Methodology of this Report 1.4 Plan of this ReportChapter Two: Market Requirements and Opportunities for Novel Lithium-Ion BatteryElectrode Materials 2.1 Consumer Electronics, Computing and Communications Applications Trends for Lithium- Ion Batteries 2.1.1 Impact of Market Trends on Electrode Material Requirements 2.2 Power Tools 2.2.1 Impact of Market Trends on Electrode Material Requirements 2.3 Electric Vehicles and Other Automotive Applications 2.3.1 Impact of Market Trends on Electrode Material Requirements 2.4 Smart Grids 2.4.1 Impact of Market Trends on Electrode Material Requirements 2.5 Military and Aerospace Applications 2.5.1 Impact of Market Trends on Electrode Material Requirements NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  4. 4. www.nanomarkets.net 2.6 Other Lithium-Ion Battery Applications and their Impact on Electrode Material Requirements 2.6.1 Medical Markets 2.6.2 Data Communications Markets 2.6.3 Other Applications Page | ii 2.7 Key Points from this ChapterChapter Three: New Materials for the Lithium-Ion Battery Industry 3.1 Why the Lithium-Ion Battery Industry Needs Better Materials 3.1.1 EV and Smart Grid Market Requirements: Nascent Markets 3.1.2 Impact on the Battery and Battery Materials Market 3.2 Anode Materials 3.2.1 The Future of Graphite 3.2.2 Nanostructured Carbon and its Variants 3.2.3 Nanostructured Silicon and Its Variants 3.2.4 Titanates 3.2.5 Vanadium Oxides 3.2.6 Opportunity Analysis 3.2.7 Survey and Assessment of Firms Supplying Novel Anode Materials 3.3 Cathode Materials 3.3.1 Lithium Manganese Spinel 3.3.2 Advanced Lithium Iron Phosphates 3.3.3 Mixed Metal Oxides 3.3.4 Nickel Cobalt Alumina 3.3.5 Opportunity Analysis 3.3.6 Survey and Assessment of Firms Supplying Novel Cathode Materials 3.4 Key Points from this ChapterChapter Four: Eight-Year Forecasts 4.1 Forecasting Methodology 4.1.1 Impact of Industry/Application Maturity 4.1.2 Important Industry Sectors 4.1.3 Alternative Scenarios 4.2 Forecast by Application 4.2.1 Consumer Electronics 4.2.2 Power Tools 4.2.3 Electric Vehicles 4.2.4 Smart Grids and Stationary Applications 4.2.5 Military and Aerospace Applications NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  5. 5. www.nanomarkets.net 4.3 Forecast by Material Acronyms and Abbreviations Used In this Report About the Author Page | iii List of ExhibitsExhibit E-1: Firms to Watch in the Lithium Battery Industry .........................................................................................5Exhibit E-2: Total Electrode Materials for the Lithium-ion Industry .............................................................................7Exhibit E-3: Total Value of Electrode Materials for Lithium-ion Industry by Application ($ Millions) ..........................8Exhibit E-4: Total Electrode Material for Lithium-ion Industry by Application (Metric Tonnes) ...................................8Exhibit 3-1: Firms Producing Anode Materials ............................................................................................................44Exhibit 3-2: Survey of Firms Supplying Novel Cathode Materials ................................................................................52Exhibit 4-1: Electrode Materials for the Consumer Electronics Segment ...................................................................60Exhibit 4-2: Electrode Materials for the Power Tools Segment ...................................................................................64Exhibit 4-3: Electrode Materials for the Electric Vehicles Segment ............................................................................67Exhibit 4-4: Electrode Materials for the Smart Grids and Stationary Applications Segment ......................................70Exhibit 4-5: Electrode Materials for the Military and Aerospace Segment ................................................................73Exhibit 4-6: Electrode Materials for the Lithium-ion Industry .....................................................................................76 NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  6. 6. www.nanomarkets.netExecutive SummaryE.1 Summary of Opportunities from New Materials for Lithium-Ion BatteriesThere are certain characteristics that the lithium-ion battery brings to the table that have made Page | 1it widely used. These batteries have high energy densities at a high operating voltage, providingsignificantly longer battery life in smaller form factors than competitive battery chemistries.They also have low self-discharge rate and low memory effects on recharging after a partialdischarge.Currently the lithium-ion battery is a well established market standard for use in consumerdevices and various industrial applications, and is a promising candidate for use in electricvehicles (EVs) and potentially Smart Grids. However, the fact that the lithium-ion battery hasnthad a strong performance boost in recent years leaves the door open for other batterychemistries to make strong cases for themselves.There are inherent trade-offs when attempting to improve the performance of the lithium-ionbattery, and this makes it nearly impossible to find a material improvement that will provide animprovement on all fronts. Each technology addresses the needs of particular marketsegments, and with targeted efforts, material developers will see a real revenue opportunityfrom potentially high volume and/or high growth market segments.NanoMarkets believes that the lithium-ion battery industry is poised to see significantadditional growth over the next decade. One driver for this is that lithium-ion batteries appearto be slated to serve the needs of a number of rapidly growing end-user segments. But thelithium-ion battery also has some issues that need to be improved upon:  Lithium ion is conventionally a low-output power chemistry. However, a materials innovation has already addressed this fact and in fact allowed it to enter higher power market segments.  Lithium ion is also a comparatively "unsafe" chemistry, susceptible to thermal runaway leading to explosions. Although this aspect has been addressed through materials improvements in the past as well as safety circuitry, there is still much room for improvement, especially if it is to expand into markets with more stringent requirements.  Lithium ion is also an expensive chemistry (largely driven by the price of the electrode raw materials used). NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  7. 7. www.nanomarkets.netAs the lithium-ion battery segment expands, NanoMarkets believes that significantimprovements in performance will be produced through novel electrode materials, anddevelopers and manufacturers of such materials will therefore see significant new businessrevenues going forward. Page | 2 E.1.1 Lithium Cobalt Oxide (LCO)Lithium cobalt oxide is currently the cathode material of choice for most portable electronics(and indeed for any application that requires a high energy density). This material generates byfar the largest revenues of any of the materials considered in this report and despite the factthat this material is gradually being replaced by other materials, LCO will still generate $2.0billion in revenues in 2012 growing to twice that amount by the end of the forecasting period.The fact that LCO is declining slowly as a share of materials consumed by the lithium-ion batterysector is a testament to the fact that it is quite hard to replace and that the safety of thismaterial has improved somewhat. And despite the decline, NanoMarkets thinks that there arestill some opportunities to be exploited in this materials sector.In particular the development of processes that use this material and are focused on increasingthe energy density of the cell, would seem to have some new business potential attached tothem. The combination of a familiar material and improved performance would, we believe, bevery attractive in this market, unless and until next generation materials are fullycommercialized for LCO. E.1.2 Lithium Manganese Oxide (LMO)At the present time the only other cathode material that is selling at levels that are likely toproduce respectable short-term revenues for materials firms is lithium-manganese oxide(LMO). However, with almost $700 million in revenues slated for the final year of the forecastperiod, NanoMarkets believes that this material could produce some important opportunitiesgoing forward.The key point here is that manganese-based cathode materials have enabled the lithium-ionbattery to expand its addressable markets to higher performance applications. Moving tomanganese-based cathodes has already allowed the lithium-ion battery to see quite an increasein revenue in the power tools segment to the point where it now can claim a sizeable marketshare. For example, being able to power a cordless buzz saw was out of the capability of thelithium-ion battery when it first entered the market because of the limitations inherent to itscathode material. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  8. 8. www.nanomarkets.netThese higher performing segments (EVs and Smart Grids, for example) are exactly whereNanoMarkets expects to see considerable growth for lithium-ion batteries going forward, sothis fact will help define the future opportunities for manganese cathodes. Our projectionssuggest that most of the LMO opportunities going forward will be found in the EV segment, sothey are highly dependent on the future of this applications sector. Page | 3 E.1.3 Lithium Iron Phosphate (LFP)At the present time, LFP is little more than a research material. However, we believe that by2015 this material will experience enough demand to make it of considerable interest to firmsselling electrode materials into the battery segment. In the last few years of the forecast periodNanoMarkets sees this material growing fast enough to make it the second largest sector in thecathode materials market.LFP is just beginning to pay off after several years of R&D work and is a major rival to LMOgoing forward, we believe. While the value proposition of LFP is similar to LMO it is generallyconsidered to be a safer material; which is obviously a significant selling feature and we thinkthat this newer material will catch on especially in the EV and power tools market, especiallythe former. E.1.4 Nickel Cobalt Alumina (NCA) and Nickel Manganese Cobalt (NMC)Composites such as nickel-cobalt-alumina and nickel-manganese-cobalt are essentially lessexpensive replacements for lithium cobalt oxide, and an attempt to improve the energy densityof the cell. However, there are limits on how much these materials can be brought down incost because they contain cobalt and their safety has been questioned for high-powerapplications like electric vehicles.The biggest opportunity in this sector will emerge for NMC material, which will mostly find amarket in the consumer and (to a much greater extent) in the EV segment. NCA is not going tosee much use until the end of the forecasting period and the main application sector will be inconsumer electronics markets. E.1.5 Graphite and Its ReplacementsGraphite is by far the most important anode material used in lithium-ion batteries in terms ofrevenues and these revenues are expected to almost triple by the end of the forecast period;primarily reflecting the underlying growth in the market for conventional lithium-ion batteries.Nonetheless, NanoMarkets believes that there is still an opportunity to replace graphite as theindustry standard material, but this opportunity is not likely to produce potential revenue levelsthat could be considered high enough to build a sizeable business on until quite late in the NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  9. 9. www.nanomarkets.netforecasting period. In our forecasts, we specifically predict the potential revenues for lithiumtitanate and silicon.What researchers are primarily looking for in their search for a replacement to graphite arematerials that have an enhanced ability to hold lithium ions. Silicon, nanostructured carbon and Page | 4oxides of titanium and vanadium have been identified as viable alternatives to graphite for thisenhanced ability. Silicon has the highest theoretical capacity for lithium ions, but until recentlyhas had problems with durability. The silicon anode is a materials technology that is beingpioneered by smaller, early stage companies hoping to make a quick and strong impact in theindustry.Silicon is expected to make forays into the consumer electronics market segment in the earlyportion of the forecast period, mostly backed by large companies like Panasonic. This is asegment where they know that the improvement to energy density that silicon provides can beleveraged. It will also allow them to ramp up production and evaluate its viability for othermarket segments. Smaller companies developing novel silicon solutions can be expected tolicense out their silicon technology in the early phase of this forecast period. This will allowthem to see some early revenue before they can ramp up production to target high-growthsegments like the electric vehicle market.The other materials that challenge graphite in this context are mainly being developed by largercompanies. Meanwhile, while some new business revenues will be generated by firms whocome up with novel ways to approach graphite processing and structure; this represents theopportunities in the next couple of years.One reason why the alternatives to graphite are not likely to emerge until later in the forecastperiod is that these new materials appear to be quite challenging in terms of commercialdevelopment and, in any case, many of the companies that are developing novel anodematerials for lithium-ion batteries are still in their infancy.And, before new anode replacements can become a paying business proposition, the newanode technology will have to be shown to provide significant performance improvementswhile not increasing the manufacturing costs of the anode. Silicon will likely be phased in tothe market in some sense, with silicon carbon composites, and silicon gradually becoming thedominant material in the composite.E.2 Materials Suppliers to Watch in this SpaceExhibit E-1 summarizes the firms that we believe should be watched in the lithium batteryspace. These firms are certainly not the only firms that are active in this space, but representfirms that we think have an especially strong value proposition. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  10. 10. www.nanomarkets.netExhibit E-1 Firms to Watch in the Lithium Battery IndustryCompany Technology/ Strengths of the technology Market segments targeted(Cell/Materials) MaterialsAnode MaterialsPanasonic Silicon- 30% improvement in energy Consumer electronics initially – notebook(Cell) carbon density. Retains 80% capacity batteries. Can expand into EV segment in Page | 5 composite after 500 cycles. the future, while leveraging present 18650 cell revenue stream at present.3M Amorphous At least 20% improvement in Consumer electronics, EV. In the process of(Materials) Silicon energy density, development and manufacturing scale-up – pilot scale operation at present.Amprius Silicon Energy density improvements EV and consumer electronics. Recently(Materials) nanowires ranging from 1.4x-10x. received $25mill in Series B funding – goals are to deploy first commercial product and validate manufacturing process. Relatively longer timeline to market compared to other companies with similar product offerings.Nexeon Silicon nano- Energy density improvements: EV, consumer electronics, grid storage,(Materials) structures First generation – 1000mAh/g medical. Materials manufacturers – Second generation-3600mAh/g building IP position and licensing Low cost, "drop-in" solution technology to cell manufacturers. Investing in expanding manufacturing capabilities.Altairnano Lithium Safe, fast charging, 80% capacity EV and stationary applications – specifically(Materials) Titanate retention after 1,000,000 partial remote UPS applications in challenging Nano- depth-of-discharge cycles, 16000 environments, Phoenix motorcars structure cycles with full depth-of- providing entry into the EV segment. discharge, high output power Established manufacturing facilities with and temperature stability the potential to scale up.Cathode MaterialsHitachi Manganese Long cycle life, high operating Grid storage, power tools. Relatively new(Cells) based voltage technology so material is not much further composite than pilot line, but Hitachi has the resources to rapidly scale up production.A123 Nano- Nanostructure improves Transportation, storage and power tools -(Cells) phosphate conductivity, high power, longer 90 MW sold for stationary storage, has (lithium iron cycle life, much improved safety, already entered the power tools segment, phosphate) higher usable energy which entered and tested in EV applications in addresses questions on energy transit buses, proving applicability in density. industry. Strong IP position, dispute with Hydro-Quebec settled.Envia Systems NMC High energy density (twice that Electric vehicles (strategic ties with General(Materials) (licensed of lithium cobalt oxide), high Motors), consumer electronics, military. from usable capacity and long cycle Argonne life, stable at high operating National voltages Labs)Saft NCA High energy density, long Military and stationary storage.(Cell) service life© NanoMarkets 2012 NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  11. 11. www.nanomarkets.netOne takeaway from this Exhibit is that some very large firms are involved in this business. Theones mentioned here are Panasonic, 3M, Hitachi and Saft. We think this is a measure of theimportance that is being attached to the lithium battery materials segment both in terms ofbeing a revenue generator and an enabler for the batteries themselves. Page | 6The most noticeable aspect of the smaller firms active in this space is that they seem to behighly focused on nanomaterials. This approach, NanoMarkets believes, provides these firmswith the opportunity to develop relatively strong IP and provide solutions that are highlydistinguishable in the marketplace. Clearly, most of these smaller firms have a few years ofslogging away at R&D before they can be expected to produce large revenues.E.3 Roadmap for Lithium-Ion Battery Materials and Eight-Year Market ForecastExhibit E-2 summarizes the market for lithium-ion battery materials over an eight-year period.As the Exhibit shows this is already a substantial market, at $2.8 billion, and is expected to growto a much larger market, $8.2 billion, by the end of the forecasting period.Much of that market growth is explained simply by the growth in the direct or indirectaddressable markets. That is to say that both existing markets for lithium-ion batteries(consumer electronics) are likely to expand and new markets are likely to emerge (EVs).However, this represents an "opportunity" that is beyond the ability of materials suppliers tocontrol. We also note that the automotive market for these batteries is highly uncertain andthat "pure" EV products are a very long way from being successful in the market.The new materials opportunities have largely been explained above and will not be repeatedhere. However, our forecasts in the Exhibit suggest that the opportunities presented by newmaterials are quite dramatic. Thus at the present time, our forecasts suggest that about 30percent by value of the materials market discussed in this report are currently represented bynew (i.e., not LCO or graphite) materials. By the end of the forecast period, we see thatnumber grow to around 50 percent. In money terms what we are talking about here is a newmaterials opportunity worth just $257 million this year, but which will reach $2.8 billion in2019. This is quite a dramatic change! The roadmap for the lithium-ion battery materials discussed here is very much dependent onthe direction the lithium-ion industry takes in general. While the consumer electronics andindustrial power tools segments are established, steadily growing markets, the electric vehiclesand Smart Grids (and stationary applications) market segments have led to more conjecture,with some forecasts predicting rapid growth in these segments that will spur materialsinnovation and the demand for novel materials; and others being more skeptical. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  12. 12. www.nanomarkets.net E.3.1 Features Required for Competitive BenefitThese revenues will be competed for along a number of dimensions. Safety and costs seemespecially important.Exhibit E-2 Total Electrode Materials for the Lithium-ion Industry Page | 7 2012 2013 2014 2015 2016 2017 2018 2019TOTAL CELLS SOLDRevenue ($ Millions)CathodeLCOLMOLFPNMCNCATOTALAnodeGraphiteLTOSiliconTOTALGRAND TOTALWeight (Tonnes)CathodeLCOLMOLFPNMCNCATOTALAnodeGraphiteLTOSiliconTOTALGRAND TOTAL© NanoMarkets 2012 NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  13. 13. www.nanomarkets.netExhibit E-3 Total Value of Electrode Materials for Lithium-ion Industry by Application ($ Millions) 2012 2013 2014 2015 2016 2017 2018 2019ConsumerElectronicsPower ToolsElectric Vehicles Page | 8Smart Grids &StationaryMilitary &AerospaceTotal ElectrodeMaterial Market© NanoMarkets 2012 Total Electrode Material Market for Lithium-ion Industry 9,000 8,000 7,000 6,000 Military & Aerospace $ Millions 5,000 Smart Grids & Stationary 4,000 3,000 Electric Vehicles 2,000 Power Tools 1,000 Consumer Electronics 0 2012 2013 2014 2015 2016 2017 2018 2019 © NanoMarkets, LCExhibit E-4 Total Electrode Material for Lithium-ion Industry by Application (Metric Tonnes) 2012 2013 2014 2015 2016 2017 2018 2019ConsumerElectronicsPower ToolsElectric VehiclesSmart Grids &StationaryMilitary &AerospaceTotal ElectrodeMaterial Market© NanoMarkets 2012 NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  14. 14. www.nanomarkets.net Total Electrode Material for Lithium-ion Industry 350,000 300,000 250,000 Metric Tonnes Page | 9 200,000 Military & Aerospace 150,000 Smart Grids & Stationary 100,000 Electric Vehicles 50,000 Power Tools 0 Consumer Electronics © NanoMarkets, LCSafety: Safety is a very big issue that needs to be addressed with high power requirements withlarge cell packs and larger format batteries. These are employed in hybrid electric vehicles andelectric vehicles. This is a high-growth market where safety will be one of the key enablers thatallows the lithium-ion chemistry to be a significant part of it.Costs: Decreasing the materials costs associated with lithium-ion battery production will go along way towards making the chemistry ubiquitous in emerging markets like the electric vehicleand smart grids market. In fact, reducing battery costs associated with electric vehicles is amarket force that will push the adoption of electric vehicles in the market.E.4 Concluding Remarks on Market StrategiesThe military market segment—as it often does—offers a chance for firms in the new materialsspace to try out new ideas, without having to ramp up to large volumes and with sales atpremium prices.However, for smaller companies that dont have access to military/aerospace markets, thereare other strategic options:  One option for smaller companies pioneering novel technology that isnt at the stage of volume production comes in the form of licensing agreements with larger manufacturers. This will allow these smaller firms to get their product on the market while leveraging their materials expertise. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  15. 15. www.nanomarkets.net  Additionally, in market segments like the electric vehicle segment, partnerships with manufacturers of the end product (in this case automobile manufacturers) will allow for market exposure for new products, with development cost shared with the OEM/ automobile manufacturer. Page | 10Larger companies that are planning on launching silicon-based products can be expected toleverage established production lines and revenue streams in order to get their product on themarket. This will allow for the market viability of the technology to be evaluated. They can takeadvantage of the more established consumer electronics or power tools segments to rampproduction levels while seeing revenues, thereby preparing them to take advantage of the highgrowth expected from emerging segments towards the latter half of the forecasting period. Total Lithium-Ion Electrode Material Revenue 9,000 8,000 7,000 6,000 $ Millions 5,000 4,000 3,000 2,000 1,000 0 2012 2013 2014 2015 2016 2017 2018 2019 © NanoMarkets, LCTo obtain a full copy of this report please contact NanoMarkets at sales@nanomarket.net orvia telephone at (804) 938-0030 or visit us at www.nanomarkets.net. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  16. 16. www.nanomarkets.netChapter One: Introduction1.1 Background to ReportLithium-ion batteries are a technology poised to see a large growth in revenue in the next five Page | 11years because of their potential in applications such as electric vehicles, consumer electronicdevices and Smart Grid applications. That there is a clamoring in the market for a drasticimprovement in lithium-ion battery technology is obvious to see:  EVs are trying to compete with the internal combustion engine, an established technology that is likely not going to be beaten in the mass market anytime soon.  Smart and application laden consumer devices are rife and are only becoming more application heavy which is a huge draw on battery life.  Additionally, power companies are pushing to respond to residential and industrial energy needs with smart energy grids to reduce the number of brown outs and blackouts and the ability to integrate renewable energy sources into the grid.Of all the battery chemistries contending for a place in these markets, the lithium ion isarguably the best poised to enter and capture sizeable portions of these segments or at leasthas a fighting chance to do so, but a performance increase is necessary to assure this batterychemistry gains a strong foothold. 1.1.1 The Importance of Electrodes for Lithium Battery Performance ImprovementA fact worth noting here is how mature the lithium-ion market is. It is not a market wheredisruptive, performance enhancing technology is common. But with a sudden projectedincrease in unit volume and performance demand, there is now potentially a very large marketthat is not having its needs ideally met.The realizable market opportunity exists because of the plateau that the current industry-standard electrodes have reached. Technological innovation currently provides a minimalincrease in performance year to year in current lithium-ion batteries:  It is more processing improvements and improvements in cell design that have been providing incremental improvements in battery performance in the recent past.  However, the performance demands of the market are growing at a pace too quick for the tweaks that can be made to the current battery to match. This mismatch between NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  17. 17. www.nanomarkets.net the expectations and needs of the market and the inability of the current industrial state of the art has provided a technological gap that needs to be filled. Since markets for the lithium-ion battery is so heavily performance driven, a large opportunity here exists for developers of anode and cathode materials. Page | 12To successfully enter and maintain its hold in the newer market segments listed above beforestrong inroads are made by other battery chemistries, the lithium-ion battery, NanoMarketsbelieves, needs materials advancements to propel it out of the performance plateau that thecurrent industry standard has found itself in. As a result, the time is ripe for a profoundimprovement in the performance of the lithium-ion battery, and novel electrode materials arebeing investigated to provide this:  The current graphite anode, and the lithium-cobalt cathode used in the most common lithium-ion chemistry are at the point of being phased out because they are nearing the limit of technological innovations that significantly improve their performance. The fact that the lithium-ion battery hasnt had a strong performance boost in recent years leaves the door open for other battery chemistries to make strong cases for themselves.  Nonetheless, there is no outstanding novel electrode material technology that has made it to the production line and satisfies the expected increasing demands in battery performance.  Additionally, certain technologies have proved to be better at addressing specific value propositions. There are inherent tradeoffs when attempting to improve the performance of the lithium-ion battery, and this makes it nearly impossible to find a material improvement that will provide an improvement on all fronts. Each technology addresses the needs of particular market segments, and with targeted efforts, material developers will see a real revenue opportunity from potentially high volume and/or high growth market segments.The development of advanced materials that will replace the current state-of-the-art anodesand cathodes is based on the improvement in energy density and/or (depending on the marketsegment) power density provided to the battery. Having mentioned the "make or break" natureof the energy and power density properties, it is important to note that each market segmentwill identify certain key secondary properties that materials developers need to have a verystrong handle on. Weight, form factor, life cycle and environmental impact are a few suchexamples. This is where product differentiation among electrode technologies will decide whichmaterials will excel in a given market segment. While the differences may be subtle between NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  18. 18. www.nanomarkets.netmarket segments, it is the deciding factor between materials producers not aligning the valueproposition of their product with the demand of their target market segment.Cathode improvements: Cathode materials tend to provide more diversity in terms of the cellcharacteristics they have an impact on. While anode materials are being investigated mostly to Page | 13improve the energy density of the cell, various cathode materials can either improve the energyor the power density, provide faster charging times, more safety and/or lower costs.The cathode reaction in the lithium-ion cell is also a safety concern, and while the potential toimprove the energy density must be considered, the stability of the materials in the cellenvironment is a crucial concern.A lithium-manganese based cathode is right now the furthest penetrating competitivetechnology to the conventional lithium-cobalt cathode. Other materials that bear looking atare:  Lithium iron phosphates and their derivatives.  Composites of nickel, manganese and cobalt are being developed specifically for the automotive market segment. With development being pushed in tandem by established companies in both the battery and automotive spaces, we can expect this technology to be a frontrunner to capture the opportunity in that segment.Anode improvements: Next generation anode technologies are typically identified by theirpotential to hold lithium ions. In general, replacement anode materials have been less commonthan those for cathode materials:  At this stage silicon, nanostructured carbon, and oxides of titanium and vanadium have been identified as viable alternatives to graphite for this enhanced ability.  The metal oxide materials are seeing development in the labs of the larger, more established materials suppliers, such as NEI and 3M. It can be expected that these companies with experience in supplying to the battery industry are likely to tailor their products to simply drop in to the present battery manufacturing production line. Emerging companies may find it harder to do this.  Silicon has the highest theoretical capacity for lithium ions, but until recently has had problems with durability. However, structural modifications to the silicon electrode have let it become a potentially disruptive technology in this market. The silicon anode is a materials technology that is being pioneered by smaller, early stage companies NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  19. 19. www.nanomarkets.net hoping to make a strong impact in the industry. While it has a longer development timeline, its potential to make an impact is sizeable, making it a materials technology worth investigating.Nanomaterials: The manipulation of the physical structure of the active electrode material also Page | 14creates another opportunity in this space. In an effort to increase the surface area for thestorage of charge and to address issues with durability (due to the significant expansion andcontraction of some materials when they take up or release lithium ions), developers are usingprocessing techniques to create nanostructured versions of electrode materials.Nanoparticles or nanotubes in the form of a powder are examples. The opportunity that couldbe realizable here is for producers of binding materials that provide a conducting matrix inwhich the nanostructures can be embedded. Binding materials are already being used inbatteries to hold together powder based electrodes and improve conductivity, and willcontinue to see applicability as electrode materials are pushed towards powdered forms toincrease surface area for lithium-ion absorption.Finally, a big question materials developers will need to answer as they see a realizableopportunity before them in a very mature market is how they are going to integrate theirproduct into the production line of battery manufacturers.The more established companies like Sony, Sanyo and Samsung will already have this in mindwhen thinking of the materials they are developing but new entrants to this market will havethe added burden of creating manufacturing processes compatible with current productionprocesses unless they want to bear the manufacturing cost of the entire battery. A companysapproach to this challenge will be a significant product differentiator and will determine ofwhich market it can realistically meet the unit volume demands.1.2 Objectives and Scope of this ReportThe objective of this report is to identify and quantify the business revenue opportunities fornovel electrode materials in the various market segments that the lithium-ion battery caters to.This is done through an analysis of the needs of these market segments and how each novelmaterial technology is best suited to satisfy those needs.This report also provides granular eight-year market forecasts for electrode materials in thelithium-ion battery industry and is international in scope. We have not been geographicallyselective in the firms covered or interviewed for the purposes of compiling this report. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259
  20. 20. www.nanomarkets.net1.3 Methodology of this ReportThe information for this report is derived from a variety of sources, primarily fromNanoMarkets interview program of technologists, business development managers andacademics associated with this field. An extensive search of the technical literature and relevantcompany Web sites was also conducted. Page | 15The forecasting method used in this report is explained in detail in Chapter Four but thefundamental approach is to identify the key market segments for the lithium-ion battery andthe needs of each customer base that electrode material can address. The driving forces withineach segment are looked at to judge the level of market penetration that each novel materialstechnology can achieve within its target market segment.1.4 Plan of this ReportChapter Two will analyze the market requirement for novel lithium-ion battery electrodematerials as seen by the main market segments. Chapter Three will then go on to analyze thenew material technologies that are undergoing development in the lithium-ion space and theopportunity each of these novel materials will see.Finally, Chapter Four will go over our eight-year forecasts for these novel materials, both fromthe point of view of the material system being developed as well as the applications thatpresent themselves. NanoMarkets, LC | PO Box 3840 | Glen Allen, VA 23058 | TEL: 804-270-1718 | FAX: 804-360-7259

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