The document discusses battery innovation and whether it is incremental or disruptive. It notes that lithium-ion battery costs have declined significantly from $1000/kWh in 2010 to $400-1500/kWh currently due to improvements in materials, cell design, and manufacturing. Silicon anodes are a promising disruptive technology that could increase energy density by 10-35% but are only being commercialized in small formats currently. Both incremental changes to materials like varying cathode chemistries and disruptive changes like new anode materials will continue to drive innovation across the entire battery value chain.

1. BATTERY INNOVATION:
INCREMENTAL OR
DISRUPTIVE?
ALBERT CHEUNG
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2. LI-ION BATTERY PACK COST AND PRODUCTION, 2010-
30
Total pack cost ($/kWh) Annual production (MWh
1,200
1,000
800
600
400
200
/ / / / / /
180
160
140
120
100
80
60
40
20
-
Source: Bloomberg New Energy Finance
0
TODAY’S RANGE:
$400-1500/KWH
2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030
Annual battery production (GWh) Battery pack price (2010 $/kWh)

3. EV LITHIUM ION BATTERY SUPPLY & DEMAND (MWH)
/ / / / / /
Source: Bloomberg New Energy Finance
12,200
27,900
33,300
2,400
8,800
16,000
2011 2012 2013
Annualized supply capacity
Declared annual demand

4. COST IS JUST ONE OBJECTIVE
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COST
CALENDAR
LIFE
ENERGY
DENSITY
POWER
DENSITY
CYCLE
LIFE
IDEAL
BATTERY
SAFETY

5. WHERE WILL GAINS BE MADE?
Raw/processed
materials
Battery
materials
/ / / / / /
Cells
Packs
Vehicle
Integration
Cost Performance
Alternative electrodes / electrolytes
Materials development
Cell size and format
Cell design features
Pack design
Thermal management
Pack assembly
Chassis integration
LFP, NCM,
electrolytes, etc.
Process improvement & scale
Integration with other vehicle systems

6. ‘INCREMENTAL’ IMPROVEMENT IN CATHODE
CHEMISTRY
CATHODE COMPOSITION NCM PROPERTIES
Current
NCM
LCO
LMO
Future
NCM?
/ / / / / /
• NCM is one of several cathode types in use
• Blend of three lithium oxides:
nickel / cobalt / manganese
• Major users include Sanyo (Panasonic) and
GS Yuasa
• Good energy density
• Moderate safety (not as stable as LFP)
Source: Bloomberg New Energy Finance.
less less more
Future
NCM?
Ni Co Mn

7. ‘INCREMENTAL’ IMPROVEMENTS IN CATHODE
CHEMISTRY
CATHODE COMPOSITION LMO AND LCO PROPERTIES
Current
NCM
LCO
LMO
Future
NCM?
/ / / / / /
LCO: lithium cobalt oxide
• Older technology (consumer batteries)
• Good energy density
• Poor safety / thermal properties
LMO: lithium manganese oxide
• Current technology (eg Nissan, GM, LG Chem)
• Good safety / thermal properties
• No expensive cobalt
• Lower energy density
Source: Bloomberg New Energy Finance.
Future
NCM?
Ni Co Mn

8. ‘INCREMENTAL’ IMPROVEMENTS IN CATHODE
CHEMISTRY
CATHODE COMPOSITION POSSIBLE FUTURE BLENDS OF NCM
Current
NCM
LCO
LMO
Future
NCM?
/ / / / / /
Less cobalt?
• Lower cost
• Better safety / thermal properties
• Similar performance
More nickel?
• Increases energy density
More manganese?
• Potentially much higher energy density and lower
cost
• Needs better electrolytes and anode
• Very early stage Source: Bloomberg New Energy Finance.
Future
NCM?
Ni Co Mn

9. ‘DISRUPTIVE’ CHANGE IN ANODE MATERIALS: SILICON
• Silicon theoretically absorbs 10x as many Li ions as graphite - much higher E density
• Historic problem: silicon structures suffer from fatigue/pulverisation after a few cycles
• Solution: nanostructures / nanowires
• Axeon claims energy density improvement of 35%, Panasonic claims 20%
• Panasonic and LG Chem aim to launch Si-anode consumer batteries in 2012-13
• Only small cell formats being commercialised
/ / / / / /
Source: Images from Nexeon.

10. ‘DISRUPTIVE’ CHANGE IN ANODE MATERIALS: SILICON
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Source: Images from Nexeon.
Carbon anode:
6C + Li+ + e- ↔ LiC6
Silicon anode:
4Si + 15Li+ + 15e- ↔ Li15Si4

11. MAX CAPACITY OF 18650-FORMAT LI-ION CELLS (AH)
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
New Si-anode
1990 1995 2000 2005 2010 2015
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Source: Bloomberg New Energy Finance, Nikkei.

12. CELL AND PACK DESIGN CHOICES
NUMBER OF CELLS IN MAIN EV MODELS CONSIDERATIONS
315
288
192
192
Tesla Roadster
BMW Mini-E
Fisker Karma
Chevrolet Volt
Renault Fluence
Nissan Leaf
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18,650 format (consumer cells, 2-3Ah):
• Leverages decades of experience
• Sophisticated management system needed
• Not as applicable for PHEV
Larger cells (up to 50Ah):
• Easier packaging and thermal mgmt
• Greater potential for improvement with
experience
• Second life considerations?
88
5,088
6,831
Mitsubishi i-MiEV

13. OTHER AREAS OF INNOVATION
/ / / / / /
• Air vs. liquid cooling
• Small vs. large cells
• Intra/inter-cell thermal gradients
• Use of CFD and advanced BMS
Source: Images from Axeon.
THERMAL
MANAGEMENT
VEHICLE
INTEGRATION
• Bespoke vehicle platforms
• Battery placing and design can
impact:
• Handling
• Safety
• Cost

14. CONCLUSIONS
• There will continue to be innovation at every step of the value chain
• There are no clear lines between ‘incremental’, ‘step-change’ and ‘disruptive’
innovation
• Innovation is non-linear and the experience curve hides many subtleties
• There will be winners and losers
• There are technologies that could ‘re-boot’ the experience curve:
lithium-air, magnesium-ion, flow batteries, nanotube electrodes, etc...
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