CMU study suggests difficulties in reaching targeted low price points for Li-ion batteries
11 December 2016
A new study by a team at Carnegie Mellon University examining the costs for varied cell dimensions, electrode thicknesses, chemistries, and production volumes of cylindrical and prismatic Li-ion batteries finds that although further cost savings are possible from increasing cell dimensions and electrode thicknesses, economies of scale have already been reached, and future cost reductions from increased production volumes are likely to be minimal.
Their findings suggest that prismatic cells, which are able to further capitalize on the cost reduction from larger formats, can offer further reductions than those possible for cylindrical cells. However, none of these changes are sufficient to reach the DOE energy storage target of $125 kWh by 2020, the study found. Even in the most optimistic scenario, when the cells are the largest (20720), electrodes the thickest (100 mm), and the production volume is 8 GWh per year, the cost per kWh for LMO cells is well above the DOE target. NCA cells are $206 kWh-1 and NMC cells are $180 kWh-1. Their paper is published in the Journal of Power Sources.
Engineering and Public Policy (EPP) Ph.D. student Rebecca Ciez and Materials Science and Engineering (MSE) and EPP Professor Jay Whitacre—who earlier this year published a paper concluding that lithium market fluctuations are unlikely to impact Li-ion battery prices significantly (earlier post)—developed a process-based cost model tailored to the cylindrical lithium-ion cells currently used in the EV market.
They noted that due to current sales trends, three lithium-ion chemistries account for nearly all of the storage capacity, and half of the cells are cylindrical. However, no specific model has existed to examine the costs of manufacturing these cylindrical cells.
The number of vehicles sold and the storage capacity of these vehicles varies significantly. The Tesla Model S, one of the most popular electric vehicles, has a battery pack that varies between 75 and 90 kWh, much larger than the 10.5 kWh average pack size for PHEVs and double the 42 kWh average for BEVs. These packs also use cylindrical lithium-ion cells, a departure from the prismatic cells examined in previous models.
Electric vehicle sales and pack sizes also impact the most commonly used lithium-ion chemistries. Lithium Nickel Cobalt Aluminum Oxide (NCA) is the most common chemistry, accounting for half of the storage capacity on the road today, and Lithium Manganese Oxide (LMO) and Lithium Nickel Manganese Cobalt Oxide (NMC) account for approximately a quarter each. Other chemistries have been used in niche applications (predominantly in California compliance cars and early electric vehicle models), but have largely been phased out.… Also as a result of these sales trends, on a per kWh basis, the majority of lithium-ion batteries on the road in the US today are cylindrical.
To date, manufacturing process research and cost models have focused exclusively on prismatic cells, and there is no specific model to address the costs of manufacturing cylindrical cells. To address the disparity between the current EV battery market and research, we present a process-based cost model specifically adapted for manufacturing cylindrical lithium-ion cells.—Ciez and Whitacre
Further cost reductions are possible if manufacturers can avoid markups on cathode precursor materials, and by increasing the size of the cells. In this regard, prismatic cells have a slight advantage over cylindrical cells, because they can use thicker electrodes and have a higher storage capacity per cell. However, even with these changes, none of the cells considered reached the Department of Energy cost target of $125 per kWh.
|Cost per kWh for lithium ion batteries made in two different configurations: cylindrical and prismatic. Even at full scale, where all economic advantages are realized, no approach is near the $125 per kWh target. Source: CMU. Click to enlarge.|
While initial cost savings are possible from increased production volumes, the potential for cost reductions from scale alone past 1 GWh of annual production—a level large battery manufacturers have already surpassed—is minimal, they found. At these higher production volumes, materials play a significant role in the $/kWh cost, accounting for roughly half of overall expenses.
Cathode material costs can be reduced by producing them from precursors in-house instead of purchasing them from suppliers. LMO is subject to the highest markup, at almost 200%, but the markup for NCA and NMC have substantial impacts on the cost per kWh as well. Like prismatic cells, lithium prices play a small role in the cost of NMC and NCA cylindrical cells. A more than 200% increase in the price of lithium carbonate leads to a less than 10% increase in the cost per kWh for each of the cell configurations considered.—Ciez and Whitacre
Cell hardware is also a significant contributor to overall cost; with their greater design flexibility, prismatic cells can be larger, requiring less hardware per kWh and thereby reducing cost. The study found that LMO prismatic cells can be manufactured for less than half the cost of cylindrical LMO cells. Although there is potential for reducing costs using prismatic formats for NCA snd NMC cells, those cells are more rate-limited than their LMO counterparts, the study found.
Many of these materials are already highly commoditized, and unlikely to see significant cost reductions. While we are open to the idea that very low-cost lithium-ion batteries can be produced, our comprehensive analysis does not show a clear pathway to this based on what we know today.—Rebecca Ciez
This work was supported by a National Science Foundation Graduate Research Fellowship.
Rebecca E. Ciez, J.F. Whitacre (2016) “Comparison between cylindrical and prismatic lithium-ion cell costs using a process based cost model,” Journal of Power Sources, Volume 340, Pages 273-281 doi: 10.1016/j.jpowsour.2016.11.054.