Douglas Korthof

A123 Systems Looks Headed Back to IPO Price

The problem for me with A123 is that it is priced as if it were selling to electric cars, but the reality is it's major customer is power tools...and it seems to lose money on each kWh of battery sold.

Will A123 work in cars? Well, that's an open question. So far, all "real" EVs (that is the only one left, the Toyota RAV4-EV, last sold in nov., 2002) use Nickel Metal Hydride (NiMH) , the only battery that so far is economical in EVs (and thus sabotaged by GM and by Chevron Oil's Oct. 10, 2000 purchase of control and subsequent lawsuit to stop production, settled in Nov., 2002).

Even the "costly and phony" EVs, which are all Lithium and of unknown but high cost, such as the super-costly Tesla, the promised "Volt-hoax", the Nissan Leaf, and others, chose NOT to use A123 for technical and other reasons that would take a page to explain. But they turned away from A123, is the fact of the matter; perhaps they will return...or not.

Apparently, the only public potential customer is the EV version of the Daimler "smart car", but Daimler is a very weak company, technically, so they may change their minds, too, when they find out the issues that, for me, put A123 in question for EVs. Basically, Daimler doesn't care a fig about EVs, so their proposed "use" of A123 may be purely fanciful.

The idea of "grid backup" using $1000/kWh batteries is laughable; $50/kWh lead-acid batteries would make more sense if "peak shaving" via batteries made any sense at all. But it doesn't; the current way to "store" massive amounts of power (and thus to have instantaneous "peak power" reserves) is pumping water up to reservoirs (such as at DWP's Lake Castaic) for hydro generation.

Imagine a 1 mWh battery installation -- LOL -- contrast with a modest 340 mW combined cycle natural gas generators, and you will see that batteries don't really compare in terms of order of magnitude. And the space...cost...longevity! Discharge that 1 mWh completely over one hour, and it gooses the natural gas plant to only 341 mW -- instead, SCE is building cheap 45 mW "peakers".

Lithium remains the only proposed battery chemistry without a recycle value, it is just one way from the mines to the landfill, a completely unsustainable life cycle, IMO.

Is Fiat and Chrysler's Pullback on Electric Cars Bad News for A123 Systems?

Until Nickel-Metal Hydride (NiMH) batteries go back into production (Chevron-GM stopped their use via lawsuit), EVs will have the WRONG BATTERY with expensive Lithium that doesn't last long enough to amortize the original cost and that has no recycle value. A123 didn't have much prospect of use in transport, IMO, even before the GM pullout. Look at A123 revenues; it's almost all power tools, not EVs or hybrids. Unless Lithium works in EVs and/or hybrids, it's not easy for me to see where Aone's market cap comes from.

15 Cars Fueling the Auto Industry Recovery

Muscle cars and phony "hybrids" that still can't plug in.

Just proves that auto companies are con-jobbers, and people are stupid. How soon they forget, and how little they care.

As expected; the "green" fad will fade, and the oil-auto companies will be back to business as usual, pimping oil, where the profit is, and oil-fired cars -- which is just the "needle" for the oil drug.

Are U.S. Solar Companies Losing Market Share to Their Chinese Competitors?

This is a significant problem; Chinese allow manufacture, but after they learn how to do it, they improve it, and can undercut any price because of their "misery" savings: no workers comp, no environmental regs, no pollution controls, no wages sometimes.

A123 vs. BYD and Other Irrational Battery Investments

Another insightful article.

While I don't believe in Lithium batteries for EVs and HEV, since lead-acid and NiMH are much cheaper and have a sunset (recycle) value instead of being discarded into landfills, certainly they work in power tools and consumer electronics. Li has been improved, but still there is
<br>no Lithium hybrid,
<br>no Lithium plug-in hybrid, and
<br> no Lithium EV battery pack has lasted more than 50K miles (Tesla included).
<br>Nissan leases the battery for $150/month; that should give you a hint about how high the cost. GM is already singing the weeps about VOLT-hoax costing, because they are using the wrong battery, of course.

Whereas, our NiMH EVs are still running over 100K miles, and the batteries contain ALL the metals needed for new batteries, they recycle 100% and don't require any mining of new metals; Lithium requires a continuous supply of new mined metal, which is unsustainable.

Aone may find a use for their batteries in EVs, but so far, the bulk of their revenue is in power tools, like all the other Lithium makers.

As for Valence, it's been touting its "superior technology" for a long time, but has only managed pitifully small sales, even compared to marginal companies who try to sell Lithium batteries. Valence has become an article of faith, with a circle-jerk of the same old sales pitch about the coming deluge of cash.

Well, as Aone will find out, it's a lot more difficult to make a living off Li batteries than it is to make hoopla about them.

Shale Gas: Promises, Promises, Promises

Tom, of course you're right. Natural gas is a funny commodity; we've really got too much of it, not a shortage. Like electric, it seems impossible to use much of it. Curiously, the price per 1000 c.f. (about $8, say) translates by rule of thumb to the cost per kWh in pennies (8 cents, that is) for generation of electric in a modern combined-cycle natural gas power plant.

Ironically, electric and natural gas is massively used in the oil extraction and refining industries; because it's so cheap, almost "free", it's used to explore, extract and refine difficult petroleum deposits. Also ironically, the natural gas (and electric) it takes to make a barrel of petroleum would take a CNG or all-electric car about the same distance as the REST of the barrel takes an oil-fired car. That is, we could just leave the oil in the ground, for using the electric and natural gas to travel the same number of miles, even in individual cars and CNG trucks.

But rationality plays no part in the charade of making oil to fuel oil-fired vehicles, and plump-up the wallet of multi-national oil companies that have no loyalty to US.

Shale Gas: Promises, Promises, Promises

"...A $7-$8/Bcf..." s/b per 1000 cu. ft. or 1 million BTU, not billion cubic feet. Typo, but one wonders: when slinging numbers like billions of cubic feet and proposing differing models of declining yield curves, how much is pure B.S.?

Apple, Microsoft, Google: Cash vs. Cash

Actually, the reason GOOGLE doesn't have even MORE cash is that they HAVE done some strategic acquistions: for example, YT and DC, right off the tip of the tongue.

MSFT had dispensed the cash it had accumulated, and is now accumulating even more. What will they do with it?? Clearly, they don't have any strategic target in mind, they prefer, IMO, to wipe out and/or steal the market from the opposition, just as they ripped us off for OFFICE and WINDOWS.

MSFT is the heart of evil, IMO, and should be confiscated and/or broken up. It's time is done.

IPO Analysis: The Ultimate Story Stock, A123 Systems

Lithium has NOT proven itself as more than a niche market in Battery EVs. The proven battery chemistry is LEAD and NIMH, that's why GM and Chevron went out of their way to kill those and don't seem to even care about killing Lithium. Lithium is much more expensive, and doesn't last as long as NiMH. So what's to like?? An unproven technology that the one foe who SHOULD hate it, Chevron, has not bothered to stop. Since Chevron hasn't bothered to kill Lithium, you can bet that they aren't worried about it! So the battery EV market is problematic, at best, for Lithium.

The energy storage idea is just plain bullshit. It's not practical to use batteries to store solar energy or for peak shaving!! Utilities pump water up to places like Lake Castaic to "store" off-peak energy; the loss is at most 20%, there isn't any big replacement costs, as there would be for Lithium, and it's proven and reliable. So yes, I doubt this; it's as much hogwash as the idea of a large market for solar backup batteries. I have 8-year-old lead-acid backup batteries that cost less than $100/kWh; why would I go to Lithium for my solar electric backup system?? At a cost of $1200/kWh??? And how many people have solar electric systems, much less battery backup systems?

The power tool market is fine, but look at the numbers: it's just not enough money to support this kind of hype, IMO.

The big question is, if it's a bubble, when will the peak of the bubble be reached?

GM: What Its Progress Report Doesn't Say

General Motors is a proven liar and perverter of the truth, about everything from the EV1 to the VOLT. The same nincompoops leading GM now are the ones who fatuously and arrogantly led it into the toilet over the last few decades. Ironically, GM just RAISED salaries to "retain talent"!! With talent like that, there is NO HOPE.

GM's only hope is to flush out bad management, from top to bottom; but they are living in a dream world, still blaming the line worker for GM's management failures.

I can see it now. Fritz thinks "it was all the UAW's fault! What they should have done was design better cars, and cut management fat!!".

Unfortunately, Obama has just funded the same crew of bozos to continue blowing money down the toilet for another couple years. They will need more, of course.

Battery Investing for Beginners

John,
The ZEBRA battery was tried, but lasts only one year in EVs; the economics are impossible. Phoenix and others stumbled on that one, while they were flopping around looking for batteries. Sodium sulfur is kind of a joke; while it seems not much more temperature than a diesel engine, the heat density is much greater and it proved illusory in Ford's "EcoStar" boondoggle.


On Sep 28 01:03 AM John Petersen wrote:

> No1, there are two types of sodium based batteries. NGK Insulators
> of Japan makes a sodium sulfur battery that's used primarily in long
> discharge utility based applications. GE has recently announced plans
> to begin commercial production of sodium-metal-halide batteries that
> they plan to use first in hybrid locomotives. Both chemistries have
> their strengths and their weaknesses. The biggest weakness seems
> to be operating temperatures in the 400 to 700 degree range. A variant
> on the sodium metal halide chemistry called the Zebra battery has
> been proposed for use EVs. There's also talk out of Colorado that
> a company funded by the Coors family has found a way to make a sodium
> based battery that runs at lower temperatures. I don't generally
> talk much about the sodium batteries because they're hard to invest
> in, but the fundamental technologies have a lot of promise.

Battery Investing for Beginners

From the Aone filing, their losses to date are about twice their total sales. Other Lithium battery companies have this same economics, it means they lose $1 for each $1 in sales.

If you look at the Aone filing, most of their sales are batteries for tools, not for transportation; they've got, so I understand, about 100 plug-in prii running, with a conversion that costs $10,000. But if their cost is $20,000, this business is not sustainable; and, so far, the longest one has lasted less than a year. Perhaps it will do better than the others which have failed; we don't know yet. But that's the point: it's speculation, not fact, you're betting on.

Yes, we DO know how long existing Lithium will last; it's true that we don't know how long newer technologies will last, but then, neither do those who are betting their money that these untried batteries will perform in ways that existing Lithium failed at.

I'm not saying it's impossible that Aone (or one of the others) will succeed; just that propontents of Lithium EVs are, alarmingly, putting all their marbles on unproven ideas, and not using existing proven batteries that are cheaper and last longer.

Some of these, such as GM's Bob Lutz, are ignorant of battery economics in a breathtakingly sweeping manner. Don't be taken in the same way; remember, Lutz presided over the bankruptcy of Exide, before he was involved in the GM bankruptcy.

Peak shaving with EV batteries is bullshit, pure and simple. I've got a battery backup system and a solar system that makes more energy than needed to power two EVs (three, now); having produced $250 more energy last year than I used, why would I want to fall for the "peak shaving" fable??


On Sep 27 08:25 PM jerrydd wrote:

>
> Douglas, your posts are very your way or no way. But that is not
> true. Lithium is not expensive and is not likely to be. You only
> need less than .5lb of lithium/kwhr. So while recycling it is a good
> idea, it's not necessary. Look at my and Tom's above posts and follow
> the links and you'll find lots of .
>
> Nor are your other costs accurate anymore as they are yrs old now.
> Lithium has dropped a lot recently since they stopped using expensive
> materials like cobalt, etc.
>
> And used batteries for peak shaving at home is very viable, dropping
> your electric b50-75%. I use Cell phone tower take out batteries
> in 1 of my EV's and they work fine at very low costs.
>
> And I guaranty many EVer's will reuse every lithium battery that
> is usable they can get their hands on. Just like they do now with
> Prius packs, ganging up 4-8 packs. A companies rebuilds Prius packs
> too and that can be done with EV packs.
>
> As for how long Lithium batts will last, we don't know as many haven't
> been around long enough to see. But if after 10 yrs they still have
> 75% range left, for many that is fine. And you have to use some virgin
> lithium packs or you won't have any to recycle.
>
> Just because some companies make battery access hard doesn't mean
> they will in the future. In fact A Better Place will swap them in
> 90 seconds!!
>
> And more than lithium is going to be used as Sodium batteries are
> better for trucks, taxi's, vehicles that get used a lot so the heat
> energy loss isn't as much a problem. They are likely to last 20 yrs
> too.
>
> So lighten up. Things are not as bad as you think.
>
> On Sep 27 07:13 PM Douglas Korthof wrote:

Battery Investing for Beginners

Toxco pays NOTHING for the Lithium; they make money off the additives, Cd for example. The economics of battery production is something that is hidden from those putting their money down on stocks they basically know nothing about.

EV batteries, you need to realize, are high-power-output batteries; it's hidden in engineer-speak gobblydygood, but the EV1, for example, needed to put out up to 100 kW; the Tesla, up to 185 kW; the RAV4-EV, up to 50 kW. EV batteries age when their internal resistence rises; dV=I*r, or voltage drop depends on current times internal resistence. Spent EV batteries don't have this ability, so they are merely energy batteries, which can put out low power draw for a long time; for such batteries, it's always better to use lead-acid, which last longer and are uniform in their ability to put out energy.

So, in practice, for my 13 kWh battery backup for my solar system, I never considered spent EV batteries; I use lead AGM, which are balanced, matched and will last perhaps two decades, maybe more. Yes, I have spent EV batteries; they need to be recycled, but I never considered using them, in their rag-tag glory, for my solar system.

Lead "energy batteries" are so much cheaper than EV batteries, it makes more sense to buy new ones rather than try to match junk EV batteries. For powering a segway or wheelchair, who knows? But the market is not large enough to support an EV battery industry, if one were to develop.


On Sep 27 07:59 PM Don Harmon wrote:

> Oh contrare, Douglas. There are many uses for Lithium -ion battery
> packs which are considered "spent" by EV standards. These include
> solar, wind, e-bikes, and lots of wheelchairs for example. You just
> have a block to what this technology is capable of. You might also
> want to check out this company: www.toxco.com/ who just received
> a grant from the ARRA/DOE battery funds. They already have developed
> a real technology for recycling Lithium batteries, so you need to
> brush up on just how fast this sector is moving my friend!

Battery Investing for Beginners

Don: Also, the idea that spent EV batteries can be used in peak-shaving or solar backup is enticing, but without reality, like EEStor's claims. Most solar is grid-tied, not battery backup, and it's much cheaper to use solar for peak-shaving, with hydro storage even lower cost (at Lake Castaic, and other places, at night water is pumped up to the lake by 6 huge pump-generators powered by cheap off-peak Washington electric at 3 cents/kWh; the next day, during peak, the pumps turn into generators to retrieve the "stored" power at a cost no more than 4 cents). There's no market for spent EV batteries.


On Sep 27 06:52 PM Don Harmon wrote:

> Douglas, consider for a moment the useable life cycle of a LiFePO4
> battery pack in an automobile is 10 years. At this point the same
> battery pack still has over 75% of it's original power or energy
> density thus can be re-purposed for other markets like wind or solar
> giving it another 10 years of life (or more). Thus after 20 years
> these batteries might be ready to go to the re-cycling companies
> for reclaiming the original resources used to produce them.
>
> Don't you think that 20 years will suffice to develop the sufficient
> re-cycling technology that Lithium will require?
>
> It's only common sense when you really think about it!

Battery Investing for Beginners

So far, the maximum Lithium of any sort has powered an EV is 50,000 miles; and there's a shelf life issue. Besides this ominous fact of current Li life, the overall point is that you CANNOT talk seriously about cost until you consider logistics and sunset. Yes, it's common sense, which is sorely lacking in the supposed march to Lihtium.


On Sep 27 06:52 PM Don Harmon wrote:

> Douglas, consider for a moment the useable life cycle of a LiFePO4
> battery pack in an automobile is 10 years. At this point the same
> battery pack still has over 75% of it's original power or energy
> density thus can be re-purposed for other markets like wind or solar
> giving it another 10 years of life (or more). Thus after 20 years
> these batteries might be ready to go to the re-cycling companies
> for reclaiming the original resources used to produce them.
>
> Don't you think that 20 years will suffice to develop the sufficient
> re-cycling technology that Lithium will require?
>
> It's only common sense when you really think about it!