Declining Battery Prices Boost Electric Car Market

APR 8 2015 BY MARK KANE 59

Lithium-ion battery costs (source: RTCC - Responding to Climate Change)

Lithium-ion battery costs (source: RTCC – Responding to Climate Change)

2016 Chevy Volt Batteries Features New Chemistry And A 18.4 kWh Pack

2016 Chevy Volt Battery

Lithium-ion battery prices are without a doubt falling. At what level prices are now and where they are heading is always difficult to determine.

A recent article published by Responding to Climate Change includes an interesting graph with battery prices stated by different sources, which gives us a better outlook of the situation.

Levels of over $1,000/kWh 10-years ago seems extremely high in 2015 as most sources are saying that the industry is now somewhere between $250 to $450.

Even today we saw Tesla introduce a new base Model S (70D – details) with an additional 10 kWh of battery power (and another motor) for just $4,000 more, reflecting now only lower cost of production of the car itself, but also a declining raw battery cost.  Clearly the days of $500+ per kWh are long gone in the automotive field.

Red bottom line at $150/kWh is still 10 years from now, according to forecasts.

Anyways, lower costs of the most expensive part in electric cars will translate to a reduced price for whole cars and that will trigger higher sales.

At lower prices there will be new opportunity to increase battery capacity and range, which will expand the market too. The larger the market, more R&D spending will be directed to improve technology.

“We reviewed more than 80 different sources and found that in 2007, cost estimates for lithium-ion batteries for EV manufacturers were above US$1000 per kWh.

Seven years later, the battery cost for leading electric car models was around US$300 per kWh. This is particularly impressive, given that production and sales of EVs have only really started to pick up in the last couple of years.

If prices keep falling at this rate, we could be on course to reach US$150 per kWh – the price point around which some people believe EVs can become directly competitive with petrol-driven cars – in the next decade.”

source: RTCC – Responding to Climate Change

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59 Comments on "Declining Battery Prices Boost Electric Car Market"

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The most frustrating part about trying to put numbers to battery prices is the complete lack of specificity in what gets published.

Are all these numbers on that graph based upon the cost at the pack level (which includes wiring all the batteries together with a cooling system and a case) or just the price of the battery cells alone without including the pack? Or a mixture of both types of numbers on the same graph?

Painfully meaningless without that info.

An excellent point. It reminds me of when people talk about solar prices. You would hear things like “solar is now $3/watt” or “solar is now $2/watt” and you’d thinking “wow, so I can put 2 kW of solar on my roof for only $6000 as opposed to the $24,000 I spent 5 to 10 years ago?” Not so fast! That would be the cost of the PANELS! NOT the INSTALLED cost! Turns out panel prices are only a third of the total cost, which means that significant dip in panel price is actually not so significant after all. Not insignificant for sure, but not AS significant as advertised.

I don’t know what the INSTALLED cost of EV batteries are and how much of the total cost the cells are, but I can see a similar “not so fast” scenario setting up with all of the excitement over dropping cell prices.

A local place that sells solar panels offered me 0.85 cents a watt for a solar panel or a 200 watt solar panel for $180 dollars.

That is suspiciously cheap. I would expect most good quality panels today to be in the neighborhood of $1.50 to $2.00 per watt minimum. The cheap stuff is probably from China (and I wouldn’t trust the quality…at all). Sun Power makes really great panels.

You can probably build your own solar setup if you know how to do electrical work, but I would only do it if I were a certified electrician…and I’m not. Even if you didn’t have to pay someone to install it, there is still the inverter cost, which is considerable. And if you use micro-inverters (which is a great option if you know there will be some shading) then that is even more expensive.

Bottom line, I would expect most 2 kW systems today to be on the order of $12k – $15k installed (before credits and rebates). Quite a bit better than the $24k I spent 6 years ago, but still significant.

I just got a 3kW system installed on my roof two weeks ago for $8k. Yes, that’s after tax credit, but still well under $4/watt even without it.

I’m currently looking at Solar. I’m planning to buy it outright. How did you get an installed price that low?

Actually that pricing is probably in line with what I’m seeing. 2014 4Q average “installed price” is 3.48 per KW, before any federal/state rebates.

I shopped around and wound up going with Sungevity. They have options to buy, do a monthly lease, or a pre-paid lease. I opted for pre-paid lease for about the same cost as purchase – tax credit because they will maintain, insure, and guarantee production for 20 years.

If you do check them out, I’ll “generously” offer my referral code, 1239342. You’ll get $500 off and I’ll of course get something as well, which I’d be happy to share. I’m happy to see more solar and more EVs in the world.

Sungevity is another good company that is following the “Solar City” model of offering what amounts to a PPA (Power Purchasing Agreement). The nice thing is that, at any time, you can buy the system off of them at the current market rate minus what you’ve already paid into the system.

yikes that is expensive. almost two years ago i got an 11 KW rooftop system installed for 15k after rebates.

not rebates….tax credits

Did you do the install yourself? Does that include the cost of the inverter? I don’t know anyone who paid that little for an 11 kW system (unless you meant 1.1 kW?)! If that were true, everyone would have solar on their roof!

Well, at cell level values are already below


my calculations at a cell level:

10 pcs of 18650 cells with 3000mAh are offerred at banggood for 16.51$ -> that would be roughly


when ordered in bulks of 100x10pc price drops further to roughly

139 $/kWh

We need more information on how much more is the battery-price at pack-level…

Please everyone guesstimate!

I start with 60% more!
=> 139 $/kWh * 1.60 = 222.4 $/kWh

if only you knew that what you wrote means nothing, as whose cells are fake… and you can’t make conclusion from retail pricing either

Surely a 30000 dollar electric car is easily achievable by 2017 you will a 50kw pack in a leaf or tesla. Make way for the electric car say goodbye to toyota fool cells

Who gives a crap about Toyota’s fuel cells? I want cheaper EVs so we can replace millions of ICE cars with local emissions free EVs.

And we do that while simultaneously cleaning up the grid with more solar PV, more onshore wind, more tidal, more hydropower, more offshore wind, more geothermal, more biomass, more CSP, more nuclear, and other carbon-free sources of electricity.

Unfortunately, California’s politicians do.

No more nuclear please! The stupidest autodestructive tech mankind ever built!

Nuclear power plants are much less destructive to the environment and much less of a hazard to public health than coal-fired power plants. If people were rational, and not subject to hysteria over “RADIATION!!”, we’d have long ago shut down every single coal-fired power plant and replaced it with clean, -much- safer nuclear power.

Here’s something the anti-nuke crowd won’t tell you: The hazardous fumes from coal-fired power plants kill an estimated 15,000-30,000 Americans each and every single year, and of course worldwide it’s much worse. Nuclear power is orders of magnitude less of a hazard to health.

Yes but Nuclear power plant waste material has the potential to kill for thousands of years after the power plant is long gone. You can effectively “shut off” a coal fired plant and eliminate the inhalation risks in a few minutes.

No nuclear power for me thanks!

Safe disposal of nuclear waste is achieved routinely in France. It’s not a particularly hard technological challenge; just a social one.

The idea that somehow nuclear toxic waste is worse than other types of industrial toxic waste is part of “RADIATION!!” hysteria. It’s not reality.

I’d also point out that fuel reprocessing for use in the Gen III+ and Gen IV reactors reduces the amount of radiation producing spent fuel considerably. There is still the question of what to do with what can’t be reprocessed, and I don’t think burying it is the answer, but I don’t think we should let that stop us from using Nuclear.

I would argue, however, that nuclear fission should be an interim solution toward nuclear fusion.

Censorship is very strong on this matter in the U.S. … in Canada as well…

See here and take a little of your time to dig (!) the potentially apocalyptic implications of what is actually happening in Fukushima, as we write…

Here’s what’s -not- happening in Fukushima: Not one single person has died or even been hospitalized due to radiation exposure from leaked radioactive materials. Yet the Japanese government has given in to public hysteria about “RADIATION!!”, and has permanently evacuated a large zone of housing, about 85% of which hasn’t had the background radiation level raised above that of Denver, Colorado.

What is the increased incidence rate of cancer in Denver as opposed to the average rate in the USA? Zero. Nana. No increase whatsoever.

Sad to see Japan give in to the same hysteria which grips the USA when it comes to nuclear power. People make jokes about the French being cowards, but France is one of the very few countries which hasn’t let phobia over “RADIATION!!” stop them from using safe, clean nuclear power for most of their electricity.

Maybe we should be more like the French.

Here you go again! You use the word “hysteria” only when it coms to nuclear. Maybe you are a little bit to confident?

Take a look here nearly 1 million deaths in Tchernobyl from afterward cancers, according to a book from 3 eminent scientists.

And maybe the word “hysteria” would be better suited for you, you would understand and change your mind, if it was your child?
This is no fiction at all:

Oh! and this… in your backyard…

Thank you for proving my point about how fears of nuclear power amount to hysteria, and are not based on facts or science. All of those links you posted amount to hysterical fear-mongering; none are factual. The World Health Organization has estimated the -total- worldwide death toll from the Chernobyl accident at 4000. That includes fire-fighters and other workers directly exposed to large amounts of radiation at the site of the accident. Of course, that accident happened only once, just one year; the much larger annual death toll from coal-fired power plant pollution continues every year. Claims of orders of magnitude more deaths from the Chernobyl accident amount to hysteria, not science. By comparison, the Union Carbide industrial disaster at Bhopal killed at least 3787, and possibly more from long-term health effects; yet nobody is calling for an end to using batteries! Again, there is this hysteria being promoted that somehow nuclear power industrial accidents are “worse” than other types of industrial accidents, and that somehow radioactive waste is “more dangerous” than other hazardous industrial waste. The mass hysteria on the West Coast of the USA regarding the almost undetectable (even with sensitive instruments) rise in background radiation from… Read more »

Dirty, Dangerous and Expensive: The Truth About Nuclear Power

“The nuclear industry seeks to revitalize itself by manipulating the public’s concerns about global warming and energy insecurity to promote nuclear power as a clean and safe way to curb emissions of greenhouse gases and reduce dependence on foreign energy resources. Despite these claims by industry proponents, a thorough examination of the full life-cycle of nuclear power generation reveals nuclear power to be a dirty, dangerous and expensive form of energy that poses serious risks to human health, national security and U.S. taxpayers.”

Speaking of manipulating the public’s concerns…

The anti-nuclear movement got its start with funding from Big Oil, over concerns that cheap residential electricity could reduce or end the demand for natural gas and heating oil. I wonder if Big Oil funded that “study” you linked to, also?

Meanwhile, back in the real world… one of the co-founders of Greenpeace is now advocating more nuclear power as a “green” alternative. Now -that- is one sane Greenie!

Nuclear power is just yet another non-renewable resource. You are just swapping uranium for oil, and there is less minable uranium deposits than there is oil.

Commercial nuclear power isn’t dependent on uranium, or any other single element. The new, safer, 4th generation tech of commercial nuclear power plants, being developed right now in a joint Chinese-American project, use thorium, which is a much more common element.

Oh, and BTW: Nuclear power is an orders-of-magnitude more powerful source of energy than burning oil, so your comparison between mining uranium and drilling for oil is rather irrelevant.

Lensman, you and pjwood are fighting the good fight against ignorance, but the anti-nuclear people BELIEVE in the evil of nukes.
They will always be able to find a book or a study that validates their belief, so facts won’t really work to dissuade them. Chernobyl, Three Mile Island and Fukushima are pretty good indications to an unbiased observer that if this is the worst that can happen with old, dirty types of nuclear power plants, then the future of nuclear power should be bright. But it is likely that we will see only a few new nukes in the US, sadly enough.

If you care to look up some of the links I’ve provided, you will find lots and lotts of scientific evidences and witnesses.
There is no place for “beliefs” in my researches.
As I said censorship is very strong and one has to find it’s owns informations to keep a bit of objectivity.
Claiming that Nuclear power is all good is also a false belief.

I prefer fixing a defective wind mill than coping with 100,000 years of plutonium poisoning and (with luck) just enough life span to reproduce before dying from cancers…

There is a big difference between the first days after a mess, when a cocktail of nucleotides wreak havoc, the ~30 years of mutation and difformity dangers from half-life isotopes like strontium and cesium and long insidious exposure to long half-life ones(plutonium and Uranium, that we know nothing of their real dangers, except that they create no-man’s land for thousands of years.

Well, I wouldn’t call it “censorship”, but there certainly has been rather sensationalized reporting by the news media of the relatively small danger from the nuclear power industry, versus the unreported but much, much greater hazard (not merely “danger”, but ongoing toxic contamination of air and water) from coal-fired power plant exhaust and waste. As far as the Chernobyl site being contaminated… yes, it is. Parts of the evacuation zone could be safely inhabited now, while other parts will be unsafe for centuries… but not the thousands of years claimed by anti-nuke activists. Many, many other sites have long-term contamination by industrial waste. Again, why is there an obsession with just one merely because the accident was at a nuclear plant? Oh, yeah… it’s that “RADIATION!!” phobia again. As though getting cancer and dying from exposure to radioactive particles is somehow worse than getting cancer and dying from exposure to some other type of industrial toxic waste. I wish coal-fired power plants were subject to the same scrutiny and safety standards as nuclear power plants. As it is, anyone who actually understands the relative dangers and acts rationally would far prefer to live closely downwind from a nuclear plant than… Read more »

Fukushima proves you wrong, every day.

No one died, and 30 gigatons of annual CO2 disagree with you.

“if people were rational”

If the moon were made of green cheese.

You start with a premise which is demonstrably not the case, and then go on to talk about how the solutions to our problems are simple technical fixes. If people were rational, we wouldn’t have our current set of problems. We would not have overpopulated the planet. We would not have fought half a dozen wars over land and resources in the last century. We would not have made the very first use of atomic energy to incinerate a city…two for good measure. We would not be flying airliners into buildings, the ocean, or mountains. We would not live 50 miles from our source of livelihood, and think it reasonable to drive there at 80 mph in what would be considered a fine house in much of the world.

Today’s American Nuclear plants are awful, but mostly because they don’t reprocess waste to reuse and reduce it.

Basically, a 55 gallon drum of nuclear waste could be reduced to the size of a coffee can, if they reprocessed the waste and used it for more power generation.

Until that happens though, I agree that Nuclear is pretty bad, and even then, it is still not the most desirable form of power.

MSR reactors are much, much better, if they can overcome the problems with system corrosion.

Yes, one of the ways in which Americans are not rational about commercial nuclear power is that we don’t recycle nuclear waste. France recycles theirs, reducing the volume by about 90%. But the really bad meme is the one that claims nuclear power plant waste poses a high-level radioactivity hazard for a million years, or 50,000 years, or whatever number the anti-nuke advocates want to pull out of “where the sun don’t shine”. The reality is that highly radioactive wastes have a short half-life… maybe 50 years or less. And the long-lived radioactive materials are not highly radioactive. You can’t have both in the same material — it’s physically impossible. The other thing being ignored very firmly, by practically everyone talking about the pros and cons of nuclear power, is that France has actually developed a -safe- way to store nuclear waste long-term. It’s dispersed into tiny particles and embedded in molten glass, which then hardens into stable glass blocks. Note that sealed in glass, it is immune to earthquakes, floods, and pretty much anything else. Sure, an individual glass block can crack or fragment, but the individual particles themselves will still be trapped in stable glass. No dissolving in… Read more »

That is one of the most uninformed Post I have seen. Nuclear is a clean energy esp. in LFTRs. The current fission reactors with Liquid Sodium and using Uranium and Plutonium are certainly crazy. Even with the fast breeders, how many people died in Fukushima ? yes.. repeat with me ONE person died. thats right folks, the biggest nuclear disaster in the recent memory has one dead person, there is environmental damage but it is not as bad as reported. Nuclear beats Natural gas (which actually puts out Radioactive Radon during extraction). If we are to substantially reduce fossil fuels, Nuclear will be the lynch-pin.

Are deaths a measure of whether or not something is good? Who has ever died of CO2 poisoning? Does this mean we should avoid renewable power sources altogether?

Clearly the concern (for me anyway) is radioactive material that has a half life of a millennium. MSR’s seem inherently safer and, more importantly, have less radioactive waste generated. Further, that radioactivity is only on the order of a century instead of a millennium.

Maybe my intel is wrong though, but it’s still hard for me to generally feel good about today’s nuclear solution in the US, given the amount of waste that we must store for many, many generations. That seems irresponsible, not knowing if those generations will be able to keep it safe.

A cleaner and better use for fuel cells would be in a grid connected utility scale power plant. I would prefer to buy electricity from fuel cells then from coal or natural gas to charge up my Leaf.

Except that 95% of the hydrogen is produced from Natural gas, and the separation process generate GHG, and the byproduct is carbon!
Take also into account that most of the Natural Gas nowadays comes from shale Fracking : the seconth stupidest auto-poisonning tech developped by mankind, after nuclear.

We have plenty of sun and wind and hydro on which we can rely forever for pennies.
It is urgent to shift from dirty power to clean independant energy.

Yeah, especially more nuclear.

This is all wrong in that if this was the case they would be building cars with larger battery packs or having larger after market battery packs.

Presuming the claims from various EV makers of nominally “200 mile” EVs have some basis in reality, then we certainly will see EVs with more kWh in the battery packs, marketed starting in 2017.

Aftermarket battery packs? I suppose eventually we’ll see those, but it will be tricky interfacing with the proprietary software and hardware in an EV maker’s BMS (Battery Management System). For a li-ion battery pack, a BMS is an absolute necessity.

I’m sure Tesla is below 200$ right now. Remember that all of these nice dots on the graphs are speculations, Companies never disclose the real cost of their batteries.

But we already know that Tesla is using a more energy dense cell, that unfortunately has a shorter cycle life. This is offset by the fact that the battery pack is so huge that the battery won’t get cycled nearly as often. But you couldn’t use that same cell in a shorter-range (IE cheaper) EV.

A shorter life cycle than what? What are you comparing the Panasonic/Tesla cells to, and are you comparing them to cells actually used in other EVs, or are you comparing them to some other type of battery cells?

Makers of practical, commercial battery cells have to balance the need for several characteristics: Power, energy density, shelf life, ability to withstand repeated charge/discharge cycles, ability to charge quickly, ability to withstand temperature extremes… and most especially, cost.

You can always find some specialty cells which sacrifice some or most characteristics to maximize one. But that doesn’t mean they’re “better”.

The Tesla Roadster’s battery pack has proven to have surprisingly good longevity. Early results indicate that the Model S battery packs’ longevity is even better.

“The Tesla Roadster’s battery pack has proven to have surprisingly good longevity. Early results indicate that the Model S battery packs’ longevity is even better.”

…because the pack is large, and cycling is reduced. This approach would not work well in a Leaf (with air cooling only), and not at all in a Prius (with little margin other than soft limiters).

All true.

I think the important point here is that the design of the battery pack, and now much or how little the EV maker “babies” its battery cells, is even more important to longevity than the exact chemistry used in the cells.

Usually when people talk about cell cost they’re referring to cell cost not pack cost. This can be misleading because the lowest cell cost does not necessarily equate to the lower cost per kWh at the pack level.

Tesla had the lowest cost at the cell level and likely the pack level a few years ago, but the cost advantage is likely disappearing at a fairly good clip.

With respect to declining cost on a cell level, the only number I have confidence in is that the the cost per kWh of the LG Chem cells will have halved between 2011 and 2017.

DonC said:

“Tesla had the lowest cost at the cell level and likely the pack level a few years ago, but the cost advantage is likely disappearing at a fairly good clip.”

The skepticism expressed by multiple legacy auto makers over Tesla’s claim that it will reduced per-kWh costs for batteries at its Gigafactory by at -least- 30%, rather strongly suggest Tesla is maintaining its lead in that regard.

But sure, as per-kWh battery costs come down over time, any differences in costs will also come down. But Tesla hasn’t been sitting on its hands, and all signs point to Tesla continuing to lead the EV revolution for the near future, if not longer. (Well, assuming that Apple is not actually planning to enter the business of making EVs.)

Yes certainly the declining battery price would have contributed to Tesla selling a version with extra 22 mile range and All wheel drive for just an extra $4,000.

Many automakers have reduced the price of their EVs already and Tesla is now making the move. Hope others follow with further cuts.

USDJPN situation is favorable, contraty to USDKRW (and even more EURKRW).
Hence, Panasonic (Japan) is in a very good situation vs. SDI or LG (KR) for instance.
Tesla is taking advantage of this. (even if they will suffer from the USDEUR rate on the European sales)

Short term is a bit messed-up with the USDKRW rate unfortunately.
And the manufacturer’s priorities at the moment is to pack MORE energy in their current batteries. We are not yet in this cost-killing strategy the Automotive industry is very good at.

As announced, 2017 will be a 1st milestone for 200 miles cars.
Then 2020…

The “Moore’s law” for batteries seems to be, for a 7-8k USD battery pack (20-25kwh today) to get +100miles every 3 years.

That would brings us at 400 miles range around 2023.
Then I imagine that the industry will maintain the level of energy, and focus on reducing even more the costs instead of packing more and more power in the cars.

This said, I totally imagine that
before 2020, the learning curve will certainly decrease, but on the upper-range of the consensus.
Then by 2020 or 2023 the curve will show a stronger decrease as the industry will indeed focus on reducing the costs (once everybody has 300 to 400 miles).

Tesla is already there (300 miles) and is already into a cost-reduction strategy.
I can imagine that, because of their battery specificity (low cost of materials, but a pain to assemble), it pushed them to build the famous Giga-Factory to lower the manufacturing (assembly) costs.

Absent from this graph is the Volt. I wonder where their costs are sitting at with LG.

Great to see the numbers reaching the mass market tipping point. This is precisely why we subsidized the price of batteries with our shared tax dollars that had previously been subsidizing rich oil companies. In a few years from now if we just keep moving EV acceptance forward and building our the charging infrastructure we will see mass acceptance in our markets. You think there are alot of Priuses on our streets… just wait till the LEAFs and Model IIIs start to show up in those kinds of numbers… How about a new state law that converts old closed gas stations that had underground tank leaks to EV quick charger locations. Many are in decent locations. Can’t wait till our air is cleaner… and we don’t have to dust so often.