For several months I’ve been telling readers that emerging lead-carbon battery technologies will be game changers in alternative energy storage. Last week, The Economist published an article about Axion Power International (OTCQB:AXPW) titled “Lead-acid Batteries Recharged” and I found a recent report from Sandia National Laboratories on its side-by-side testing of lead-acid, lead-carbon and Li-ion batteries. Now that Axion’s management is talking to the press and Sandia is releasing independent data, I feel free to explain more fully why lead-carbon technology is so disruptive. I don’t like table pounding, but this is probably the most important Seeking Alpha article I’ve written.
Lead-carbon batteries are different from other types of batteries because they combine the high energy density of a battery and the high specific power of a supercapacitor in a single low-cost device. The primary goals of lead-carbon research have been to extend the cycle lives of lead-acid batteries and increase their power. Basically, developers start with conventional lead-acid chemistry and add carbon components to the negative electrodes. While the carbon components do not change the basic electrochemistry, they increase specific power and reduce a chemical reaction called “sulfation” that occurs during charging cycles and is the principal reason ordinary lead-acid batteries fail. Over the last several years, lead-carbon researchers have followed three different development paths:
- Blending carbon additives into the lead sulfate paste that is used for negative electrodes;
- Developing split-electrodes where half of the negative electrode is lead and the other half is carbon; and
- Completely replacing the lead-based negative electrode with a carbon electrode assembly.
The DOE’s 2008 Peer Review for its Energy Storage Systems Research Program included a slide presentation from Sandia that summarized the results of its cycle-life tests on five different batteries including a deep-cycle lead-acid battery, two lead-acid batteries with carbon enhanced pastes, a split-electrode lead-carbon battery (the Ultrabattery) and an advanced lithium-ion (Li-FePO4) battery. While the tests performed by Sandia focused on smoothing power output from wind turbines and used a 10% depth of discharge from a 50% initial state of charge, which means more testing will be required before comprehensive comparisons are possible, the following graph highlights the magnitude of the cycle-life improvements that lead-carbon technologies offer today.
(Click to enlarge)
This Sandia graph is the first time I’ve seen independent comparative test data for advanced lead-acid technology, advanced Li-ion technology and emerging lead-carbon technology on the same page. Since it’s coming from Sandia I have no reason to suspect a technology bias. Frankly, I can’t see the daunting cycle-life superiority that Li-ion advocates claim. When I practiced law in Houston we affectionately called that phenomenon “all hat and no cattle.”
In addition to the cycle-life data represented by the colored lines, the Sandia graph provides parenthetical power data expressed in terms of “C rates;” a measure of the time required for a battery to deliver its stored energy. For example, if a 10-volt battery has a nominal 100 Amp-hour rating, it can theoretically deliver 500 watts for two hours at a 0.5 C rate; 1,000 watts for one hour at a 1 C rate; 2,000 watts for a half hour at a 2 C rate; or 4,000 watts for 15 minutes at a 4 C rate. Historically, lead-acid batteries have had C rates of less than one while higher C rates have been the exclusive province of supercapacitors and premium-priced battery chemistries.
As the Sandia graph shows, they began testing the lead-carbon Ultrabattery at a 1 C rate, doubled the power and tested at a 2 C rate and then doubled the power again and tested at a 4 C rate. By the time the testing was completed, the Ultrabattery had survived more than 17,000 cycles at increasing C rates. This is just one series of tests, but it provides irrefutable proof that lead-carbon is re-writing the rules when it comes to both cycle-life and battery power.
Since Sandia said it far better than I can, I’ll simply reprint the summary slide from their Peer Review presentation.
(Click to enlarge)
A 10-fold improvement in the performance of any technology is by definition highly disruptive. The fact that lead-carbon achieved these disruptive performance gains using cheap and plentiful raw materials that are readily available from domestic sources and easily recyclable for use in new batteries using existing infrastructure is an absolute game changer; particularly when the closest comparable technology is based on expensive imported raw materials that are not easily recyclable for use in new batteries using existing infrastructure.
The five entities that are actively developing lead-carbon battery technology are:
- MeadWestvaco (NYSE:MWV), a packaging material and container manufacturing company that is developing activated carbon additives for the lead sulfate pastes used in conventional lead-acid batteries;
- Australia’s Commonwealth Scientific and Industrial Research Organisation (CSIRO), which has developed a split-electrode lead-carbon battery that it calls the Ultrabattery;
- Japan’s Furukawa Battery (Frankfurt - FBB.F), which licensed the Ultrabattery technology from CSIRO and has successfully road tested its device for 100,000 miles in a modified Honda hybrid;
- East Penn Manufacturing, a privately held manufacturer of lead-acid batteries that is using carbon additive pastes in experimental batteries and has recently acquired an exclusive U.S. sublicense to manufacture the Ultrabattery from Furukawa; and
- Axion Power International, a small manufacturer of lead-acid batteries that has developed a formidable U.S. patent portfolio in lead-carbon battery technology that will begin commercial production later this year and has partnered with Gaia Power Technologies for a NYSERDA funded utility substation support project that was discussed in the DOE’s 2008 Peer Review.
Cycle-life test results for the MeadWestvaco and East Penn batteries with carbon-enhanced pastes are both included in the Sandia graph, as are test results for the split-electrode CSIRO-Furukawa Ultrabattery. While Axion didn’t participate in last year’s tests, presumably because it wanted to defer third-party testing until PbC batteries using manufactured electrode assemblies are available later this year, Axion’s strategy to replace the entire lead-based negative electrode with a carbon electrode assembly is the most aggressive of the three technical approaches to lead-carbon batteries. Based on my knowledge of how the various components interact in a lead-carbon battery, I believe Axion’s strategy will probably result in longer cycle-life and higher power than either the carbon-enhanced paste technologies developed by MeadWestvaco and East Penn or the split-electrode technology developed by CSIRO.
I’m a vocal critic of Li-ion technology because it requires expensive imported raw materials, the bulk of the global manufacturing base is in Asia, the batteries are far too expensive for large-scale energy storage systems and there are many alternative uses for Li-ion batteries that are largely insensitive to battery prices. I’ve previously cautioned that the best lead-acid batteries are more than adequate for many emerging energy storage applications and a new generation of advanced lead-carbon batteries will change the landscape dramatically. The Sandia graph is the first independent confirmation I’ve found, but I’m certain that more information will become available as the lead-carbon battery developers complete their testing and introduce commercial products to the market.
I’m the first to agree that normal lead-acid starter batteries do not stack up well against Li-ion in terms of cycle-life or power. However the picture changes dramatically when you understand that lead-carbon batteries are expected to offer comparable cycle-lives and power for about 40% of the cost of Li-ion. I believe Li-ion is the only rational choice for portable electronics, power tools, electric bicycles and hybrid scooters. I also have little doubt that Li-ion will retain the supermodel prize for sleek packaging, size and weight. However, when it comes to large-scale energy storage applications like HEVs and utility support installations, size and weight are simply design issues. They are not mission critical constraints that justify paying a 150% premium for comparable performance.
In the early days of the first five industrial revolutions, function was more important than form, substance was more important than style and fundamental economics drove the mass market to the cheapest solution. There is no reason to believe cleantech, the sixth industrial revolution, will be any different. Lead-carbon batteries are game changers for alternative energy storage, a coming investment tsunami.
Currently, industry leaders in the lead-acid battery group including Exide (XIDE), Enersys (NYSE:ENS) and C&D Technologies (CHP) are valued at substantial discounts to industry leaders in the Li-ion battery group including Valence Technologies (VLNC), China BAK (NASDAQ:CBAK) and Advanced Battery Technologies (OTCPK:ABAT). The same is true for leading developers of lead-carbon battery technology like Axion Power International, which trades at a huge discount to Altair Nanotechnologies (NASDAQ:ALTI) and Ener1 (NASDAQ:HEV). I expect the valuation pendulum to swing in the other direction when the market comes to grips with the fundamental economic advantages of advanced lead-acid and emerging lead-carbon batteries.
In closing I want to share an image from cartoonist Jan Darasz that was published in the Winter 2008 edition of Batteries International magazine with my Seeking Alpha article on the importance of rebuilding America’s domestic battery manufacturing infrastructure.
Disclosure: Author holds a large long position in Axion Power International, a leading U.S. developer of lead-carbon batteries. He also holds small long positions in Exide and Enersys and may make other energy storage investments in the future.