John Petersen

Energy Storage Opportunities After the Market Carnage

There is nothing I would like better than to be wrong about the future of electric cars, unless I could be wrong about the future cost of Li-ion batteries. Either error would be good for the country and neither would hurt the outlook for old reliable lead-acid batteries. But the fact that I would love to be wrong does not change my fundamental beliefs.

The auto companies will sell a lot of electric cars because there are a lot of people who will make poor financial choices for the right status symbol. I just believe that the number of people who can afford to pay a status premium will be a small percentage of the total population. Joe Lunchbucket is not going to buy an EV unless and until the economics and performance numbers work for him. That glowing future is a long way off.

I feel the same way about Li-ion batteries. The best estimates I've seen say that 75% of product cost is raw materials and the other 25% is labor, overhead and profit. There seem to be lots of unanswered raw materials availability questions. More importantly, Moore's law does not apply to basic chemistry and I'm convinced that anyone who is looking for quantum leaps in a 20-year old technology is delusional. So the only way I see for Li-ion battery prices to fall significantly is if somebody finds a way to ignore the basic laws of chemistry or some clever geologist finds immense new raw materials reserves in our back yard.