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The economics of cheaper batteries (arstechnica.com)
224 points by vanburen 3 days ago | hide | past | web | favorite | 152 comments

Not sure where Boomberg is getting its digits.

Wholesale price for LFP cells in China has been stably below $100 per kwh for like 5 years.

The only problem is getting to those wholesale quantities.

All major LFP cell makers seem to run a cartel to cut off small distributors from preferential pricing. Anything you can buy in small wholesale is at least 2x the price of what companies making EVs are getting.

Once upon a time good offers like these https://item.taobao.com/item.htm?id=599076665397 come up, and then vanish.

It's not a cartel or conspiracy but a simple matter of demand being consistently larger than the available production capacity. Right now owning a battery factory is a good business because there are a lot of manufacturers that are not able to secure batteries. Several car manufacturers are being blocked by this or have reduced their production ambitions because of this.

I think people are also confusing manufacturing cost vs. price here. Obviously, those are not the same. The article is mostly talking cost.

The packaged products that e.g. Tesla sells (cars, battery packs for domestic/grid usage, etc.) include more than just the battery cells.

In any case, Bloomberg is being a bit vague. On one hand, they are predicting mid 2020s for the cost to drop below 100$ and on the other hand you have people guestimating that Tesla is close to that right now. You could of course argue average price, i.e. other manufacturers are not there yet.

Demand for batteries is going to continue to increase for a while. Tesla is talking about TW factories now. The giga in giga factory used to refer to GW. That's a good indication of what they are planning to do. At that scale, the average industry cost and their cost are going to be very similar unless others also grow production capacity at the same pace.

> The giga in giga factory used to refer to GW. That's a good indication of what they are planning to do.

Haha, I never thought about that. That's actually a really clever way of quantifying the output of a battery factory. Battery capacity can be measured in watt-hours, so battery factory output could be measured in watt-hours of battery capacity produced over time, and power*time/time just reduces back to power (measured in watts).

Therefore, you could say that a factory which produces an average of 1 Gigawatt-hours of battery capacity every hour is producing 1 Gigawatt of battery capacity. I like it.

And yeah, a TW factory sounds like it'd be operating on a pretty ridiculous scale if it lives up to its name.

The gigafactory produces 20GWh of batteries per year [0], or 0.002GWh/hour. So, its more like a megafactory by your system.

I think it was just meant to mean "a factory which produces 1-999 GWh of batteries per year" - not per hour.

[0] https://www.tesla.com/gigafactory

edit: this newer 2019 source suggests a 35GWh/year as a "theoretical output". Still orders of magnitude away from a GWh/h. https://electrek.co/2019/04/14/tesla-gigafactory-1-battery-c...

Another way to look at it would be to ask "how much power would the factory need to charge all the batteriers as it produces them?" A gigawat factory would need a gigawatt electical connection dedicated to charging. That logic suggests that the largest factories will most certainly not be charging thier batteries.

You don’t sell rechargeable batteries at full power though right? At least I have never got a new iPad at 100%. More like 30%

Since world electricity production is about 3TW, a battery factory with TW capacity would saturate the world’s charging capacity within three years? (In other words, way too big even for the world’s entire battery needs...)

Musk is quoted as saying you need 100 Gigafactories. I think there’s room for error, considering the batteries needed to replace all ICE vehicles with EVs, the amount of utility scale battery storage needed to go 100% renewables, and any storage needed beyond those two primary use cases. GF1 in Sparks is also producing above anticipated capacity.

Only if your goal is to have enough capacity to store a full year's worth of energy at once. Otherwise you'd saturate the market far sooner than that.

I don’t see why that requires a cartel. Even business-to-business, the administrative/legal overhead of smaller orders implies that, for fixed per unit profits, prices of smaller orders go up.

Business-to-consumer, order size gets smaller, and consumer protection laws come into the picture, further increasing prices.

Is there even _anything_ that you can get in small wholesale/retail at prices lower than double of what companies ordering by the shipload pay?

Edit: consumer electronics might be an exception.

I heard plenty of first party accounts.

A salesman from the cell company comes to the maker of electric busses/trucks/LSEVs and says "resales of cells is strictly, strictly, strictly forbidden," and that they will unleash all torts imaginable if they found out.

And this is the prime reason why good offers popping on online auctions don't last long.

In comparison to margins of wholesale distributors of just any other industrial commodities in China, margins of large battery cell sellers look unbelievable.

In comparison, 18650 cells can be easily found in retail at under 125% of the wholesale price in China.

> A salesman from the cell company comes to the maker of electric busses/trucks/LSEVs and says "resales of cells is strictly, strictly, strictly forbidden," and that they will unleash all torts imaginable if they found out.

Because what invariably happens is the automaker rebins the cells based on their own QA and sells the crappy cells as automotive grade instead of sending back to the manufacturer. Next thing you know, Joe Hacker's total electric conversion uses all the imperfect cells in one poorly balanced battery and burns down a city block. I don't know if it has resulted in anything dramatic like that yet but most of the surplus cells I've bought on eBay that looked like they came from automotive stock were subtly out of spec, enough to be dangerous in high power/capacity configurations.

> In comparison, 18650 cells can be easily found in retail at under 125% of the wholesale price in China.

China doesn't have much in the way of consumer protections or a tort system that's as accessible to the general public as in the US/EU.

Next thing you know, Joe Hacker's total electric conversion uses all the imperfect cells in one poorly balanced battery and burns down a city block.

And you think manufacturers in China give a shit if that happens?

Yes, if they are the well-known large manufacturers, they certainly do to an extend. But mainly it probably depends on the deal the car manufacturers are getting. Supply prices for things not priced by open markets, are a very big secret. So the manufacturers might give car factory especially good conditions, which they don't want to disrupt the market entirely. Which is fine, as long as the batteries all end up in cars, but they don't want the car manufacturers become battery sellers and disrupt the market. And coming back to safety: they batteries might be specially configured for cars, where proper packaging and electronic control can be guaranteed, but you don't want to sell these configurations to non-manufacturers.

I would hope auto companies buying batteries would pay attention to the number of house burned down by batteries from that supplier, yes.

Its not the auto companies restricting resale

No, which is why I think they can sell them so cheap. They're largely immune to the consequences so they don't have to invest in risk mitigation which tends to be expensive.

If they are knowingly reselling dangerous out-of-spec parts, shouldn't that be an issue for law enforcement?

Usually when a corporation is involved, criminal enforcement goes out the window. That aside, it would be an issue for regulators if they were marketing to consumers, but the "spec" in this case is usually part of the vendor contract and isn't legally binding except between the original supplier and customer. Putting up a bunch of rebinned "automotive grade" battery cells on eBay doesn't count because for many items it is assumed by default that the customer is qualified to use the equipment and raw battery cells fall squarely into that category.

You can still do criminal enforcement against individuals working for the company.

I think the problem may stem from the economics of winding machines. They're a huge investment, and require comparable investments in clean room space, and it's hard to increase capacity.

If Dell or Tesla is going to commit to a large number of cells per quarter, Panasonic or Samsung or whoever can install and operate that many winding machines (or, in Tesla's case, install an entire factory). If somebody wants less, they're buying excess stock that's not earmarked and it makes sense to pay more for that.

> I think the problem may stem from the economics of winding machines. They're a huge investment, and require comparable investments in clean room space, and it's hard to increase capacity.

Biggest LFP cell makers have many factories the size of Elon's ones, and they all quietly omit their output figures for non-consumer cell businesses because... taxmen.

LFP manufacturing has been ridiculously profitable from 2010 to 2015, so even hand made cell shops were making millionaires.

Now, the party is over. Big manufacturers have crashed the margins using giant state handouts.

You could get a turnkey LFP cell line running in a garage for around $2600k-$3000k, but the time of good margins is over.

To make LFP under $100 per kwh, and still make money, you need 20-30+ lines, but with such volumes the only buyers will be EV companies, and we are back to square one with this.

You can still operate on garage scale, and try push your cells on online auctions, like many, many small makers still do, and live off small bites of distributor margins.

But you will be doing this knowing that you truly live in the shadow of biggest manufacturers, who, or whose distributors will start poaching your clients once you get big enough for them to get wind of you.

> All major LFP cell makers seem to run a cartel to cut off small distributors from preferential pricing. Anything you can buy in small wholesale/retail is at least 2x the price of what companies making EVs are getting.

That sounds like an easy way to make money. Buy large quantities, sell them in smaller batches at only 1.5x the price.

> That sounds like an easy way to make money. Buy large quantities, sell them in smaller batches at only 1.5x the price.

They will figure out who you are, and you say bye bye to your EV business.

Why would they do that? What's the incentive?

You could even pay them slightly larger prices and still make a profit.

They want to keep small wholesale prices high. The whole non-EV battery market is still quite, quite sizeable.

There's more than one producer. Wouldn't any one of them benefit from breaking rank?

Pack or cell? These days the $100/KWhr target typically refers to pack level costs, which is also what is supposed to enable price parity with ICE cars.

You're confusing the cost for cells with the cost for packs.

I'm not clear why this should be? Effectively 50% discounts for the largest customers? Market share acquisition strategy?

The largest customers probably have contractually obligated volumes that give the factory the ability to plan capital expenditures better and take less risk. I don’t know about the specifics of this industry, but it doesn’t seem ridiculous, in general. In my industry (speaker wire; closer to pure commodity than batteries), we charge our highest paying customers 2x what we pay the factory.

> contractually obligated volumes that give the factory the ability to plan capital expenditures better and take less risk

Bingo not the clown oh. That's exactly how you get better pricing. That's also how you make sure you get product when supplies get tight.

Where have you ever seen a 50% discount for an industrial commodity?

If the open wholesale price is 2X and the few big customers are paying X, that's equivalent to the ""true"" open market price being 2X and the favoured customers getting a 50% discount.

This isn't unusual in enterprise software sales, but it does seem odd for industrial commodities. What I'm asking is why, if supply is so tight, the favoured customers get favourable prices rather than all prices creeping up.

There are several reasons to give big discounts.

If a customer commits to buying enough over that you expect to break even over the next N years after paying for equipment, labor and other expenses I'll give them that price because I know for sure that I have a factor for N years. I can make a lot of money now selling any extra batteries I make at market price. Even if I can't sell in any more for a profit next year, I keep my employees paid for all of N years (giving me opportunities to find new markets) which is worth a lot in itself.

If I know a customer is well known I might give them a discount just to advertise to others they are my customer.

If a customer is large enough that them leaving would affect my bottom line they get a discount to ensure they stay with me.

If they provide me something other than money in return they get a discount. Auto makers sometimes extend employee discounts to their suppliers employees. Auto makers often do supply management tasks many levels down (my materials are certified not coming from slave labor, and GM did the research to prove it, GM will do it anyway so it isn't a big deal to let me know).

If I expect someone to be a bigger customer I will give them a discount now to ensure they can develop there. If batteries never come down in price from 20 years ago electric cars are non viable so I'll give a discount now because the volume cars represent on a small profit is worth more than all profit at volumes of 20 years ago.

That is just a few honest reasons I can think of now. There are also dishonest reasons that I'll ignore, but sometimes they are real.

I just specced a chip from digikey. going from 1 to 500 units halved the price. going from 500 to 3000 halved the price again. These kinds of price reductions are not uncommon for certain types of manufactured goods. Keeping factories running longer gives better margins. Also higher volume may change margins further up the supply line as well.

Does the discount vary monotonically? E.g. first 500 cost X, next marginal 2500 cost X/2?

Or do you end up in the situation where ordering 3000 costs less than ordering 2500?

I am pretty sure you can end up in the sort of situation where ordering 3000 costs less than ordering 2500 on Digikey, and in my experience the same goes for other major component distributors like Mouser.

It seems to me like it kind of promotes waste since one ends up ordering components that they may have no use for, but maybe it is not that big of a deal since it is common to want to have some amount of spare components when doing a production run. Personally, even if I only need a single unit of some little surface mount resistor or ceramic capacitor I usually buy 100 since the price tends to be like $0.10 each for <10 versus $0.50 for 100, and I can just add the excess to my spare parts collection.

You seem to be talking about battery cell price and the article is talking about battery pack price, which last I checked tends to be at least 30%-50% higher. For EVs it might be more if they also add cutting edge cooling systems, etc.

This was my read too; cell price has long been under $100, pack price not yet.

Vandium Redox Batteries [1] sound like they have a bright future, I recently came across a startup building home kits which have a significantly longer lifespan than Tesla Powerpacks (allegedly):


There's a huge plant being built in Dalian, China with 200MW/800MWh with Vanadium (for comparison Tesla Australia plant is 129MW/100MWh with Lithium-ion with plans to double scale this year, but currently only powers 30k homes which isn't much)


Wikipedia has a nice list of largest battery deployments in the world:



Sorting by capacity on the energy storage wiki, I had no idea that there's a 2.8 GWH compressed air plant in the US!

It's a bit of funny accounting. If someone says they have an energy storage facility with a capacity of 2.8GWh, you would expect to be able to store there 2.8 GWh worth of electricity and then be able to get back a large part of it, let's say 90%. This is how you think of a battery-based storage system. The facility described here is anything but that: you inject in a cavern a large quantity of air, and then, when needed, you get this air back under pressure and feed it to an old-fashioned gas-powered generator, who will burn old-fashioned gas for 26 hours and generate 110 MW electricity (26h * 110MW = 2.860 GWh). The generator will have higher efficiency, but pumping air at 1100 psi into a cavern doesn't happen for free, so all in all, it's not very clear how to compare this with a Tesla's Powerpack in Australia [1], which is listed at 129 MWh.

[1] https://www.tesla.com/blog/tesla-powerpack-enable-large-scal...

Interestingly the heat output of the gas turbine is also used to pre-heat the released air; it looks like this combo is what drives a lot of the gas+CAES efficiency.

So you can't easily subtract gas from the equation.

What's the liquidity expected out of these power plants, e.g. how fast is the expected turnaround between pumping in and liquidating pumped energy?

15 minutes.

Same here. Looks like it's a combination gas + compressed air generator.

Redflow of australia actually makes zinc bromide flow batteries now. It has not been a financial success to put it mildly... Much as I like the idea of flow batteries I think their window of opportunity may be closing.

You mean flow batteries in general or just vanadium redox? Because if it's in general, why would you think its opportunity window is closing?

Closed batteries have no inherent advantage on large scale stationary projects, only problems. The only gain they bring is that you can ride on the scale of mobile applications.

I'm waiting for the old car batteries to start coming online, I think that will kill anything else for stationary systems, and will just get bigger.

You can't discharge and recharge a lead acid car battery very many times before it loses capacity.

I didn't believe it was necessary to specify this, but I meant Lithium car batteries, not lead.

Ah, sure, that makes more sense. I have to retrain myself to think of "car batteries" as something other than a heavy, plastic box of acid.

If we're talking about battery technologies that haven't (yet) achieved liftoff, then Ambri[1] high-temp liquid metal cells is another.

[1] https://ambri.com

I've watched some of Sadoway's talks and they're definitely interesting. I'm curious to see if they play out favorably in the market. They're stationary-only from what I can tell, but if they're more robust that Li-ion the power-grid folks will love them.

Are you saying they tried out Vanadium before Zinc Bromide or are you just lumping them both together?

I'm lumping them together as flow batteries... Mix two liquids get electricity. Add electricity and they separate again. No memory effect, last as long as the pumps. Always liked the idea of replacing my heating oil tank with one. Not sure its ever going to happen though.

How much are the batteries? Why do you think the window is closing?

Because if lithium becomes established as cheap and good enough then there will less incentive to develope other technologies.

Redflow I believe costs as much as a lithium battery but claims to degrade less and be able to be 100% discharged. In practice they have proven hard to manufacture reliably or competively. They seemed better when they stayed theoretical. Share price is down about 95%...

They have two big problems:

1. lack of efficiency - only 80% roundtrip, much less than Lithium.

2. they go completely offline for periodic maintenance. This is done automatically by Redflow, but the loss of availability is problematic in some circumstances.

Lithium seems to have won the high efficiency niche, but there's probably room for lower efficiency flow type batteries as long as they're super cheap.

Agreed, but unfortunately, they are not cheaper and I'm not sure if its economies of scale or something else

The big advantage of flow batteries for large scale long term storage is to expand capacity you just need larger tanks and more chemicals. With lithium-ion you need to build more batteries.

> Vandium Redox Batteries sound like they have a bright future

... and have had, since at least the 1990s.

My understanding is vanadium costs too much, so there is a lot of research into cheaper chemistries.

A kilowatt hour of car battery pack costs ~$150 now. I was looking at battery powered lawn mowers last night, and noticed that a 0.42 kWh battery pack costs $350[0]. I know that power tool batteries have different requirements than car battery packs, but that base .42 kWh should still be under $100.

I feel like this is the printer/razor model, where you sell the base item for cheap, but the consumables cost are extreme.

Although, for long lasting durable goods, you have to make money somewhere, as a good battery mower may last a very long time.

0: https://community.egopowerplus.com/ego/topics/kilowatt-hours...

I think there's a combination of things here, but it's not the printer/razor model. You just don't have to replace the batteries frequently enough for that model. The battery pack should last for years. If you can cut your lawn in one charge and you cut it once a week, you should get around a decade out of it (assuming 500 charge cycles, LiIon batteries are usually 400-1,200 cycles).

The battery you're looking at isn't just shrink-wrapped cells. I've seen 1-kWh e-bike batteries around $150 on AliExpress (shipped from China) that are just shrink-wrapped cells with a cable coming out where you're supposed to be knowledgable enough about batteries to make sure you use it safely and not catch on fire and such. This is in contrast to nicely packaged batteries that cost significantly more (like $800 for 1kWh at Luna Cycle).

This battery is available when you want it (rather than shipped from China with a month wait), you're paying for the retail availability and service/support/returns, you're paying for knowing that the cells are likely reputable cells from a major manufacturer like Panasonic, LG, or Samsung, and you're maybe paying a little for the fact that it's a product-specific adaptation to fit the lawnmower.

However, it doesn't look like they're marking you up much at all. E-bike batteries are a good comparison here. E-bike batteries are a relatively competitive market and the pricing sounds about right for something that's supported, has US distribution, decent quality, not a fire hazard, etc. - $350 for 420kWh. It doesn't really sound like you're getting over-charged. If you want a battery from a well-priced but reputable source, it's not $150 per kWh for batteries of this size. It sounds like they're charging you about what batteries of that size go for. You can certainly search around for ebike batteries and see that despite their being a competitive market there, you're not paying $150 per kWh. Doing a little searching, I can see 1 kWh for $800, 850 Wh for $620, 900 Wh for $600, etc. On Alibaba, I can see some cheaper things, but we're still talking $230 for 600 Wh, $400 for 900 Wh and who knows when they'll arrive or what quality they'll be. The lawn mower company might have a little margin on you, but they aren't over-charging a lot. From what I've seen for US-source e-bike batteries, it's pretty much in-line with my expectations. I've seen 420 Wh batteries a little cheaper (like $275 is the cheapest I've seen) which is cheaper, but you're looking at a slightly more niche product (a battery for a specific lawnmower) and likely looking at a bit more retail markup (like a big box store vs. a no-name online retailer), etc. $350 is pretty competitive and you're going to need to spend it once a decade so the possible $75 margin doesn't seem like much at $7.50 per year.

I mean, you could maybe buy an e-bike battery and get it to work with the lawnmower, but I don't see e-bike batteries that are that much better for pricing. I mean, if you buy the lawnmower and it lasts you a decade and you love it, I don't feel like a $75 markup for a second decade on it feels like taking advantage of you. That just feels like retail markup and, frankly, I'd probably trust Luna Cycle more than the retailer I'd never heard of with the $275 420Wh battery. Luna's $460 650 Wh battery would cost the same as a $298 420 Wh battery, assuming the same price per Wh. $50 just doesn't seem bad.

I can look at a tool store catalogue right now, and for a 18V 4Ah lithium battery the cheapest brand is half the cost of the most expensive brand. In that case, factors like retail availability are identical - but the price difference persists.

It's pretty well known that power tool buyers have to watch out for battery prices.

"Lithium batteries" are not just lithium batteries, just as steel is not just steel.

There are many variables that are not visible to the naive observer, even for batteries from the same manufacturing plant.

I can tell you as someone who sells products to the public that price is one of the primary drivers of sales. If there was a way for the higher quality manufacturers to cut their sell price in half, they would do that. But that they have decided to go into the market with a price that is 2x the cheapest competition tells you that they have very good reason for doing so.

I've also served on company boards which believed "if the product is cheaply available then it will be considered low quality by the end user regardless of how much better it is in comparison to the competitor, so we must not drop the price and keep our margins high, take out more in profits".

They also say, "competing on price is for losers, it's race to bottom and at the end we'll have no margins left"

E-bike batteries ... not a fire hazard, etc.

Yes, that remains a big problem.[1]

We need battery chemistries that don't have a thermal runaway problem. It's too bad that safe lithium iron phosphate batteries lost out due to lower energy density.

[1] https://www.bicycling.com/bikes-gear/a28778383/electric-bike...

The problem is, ten years after you buy your mower and need to replace the original battery pack, will the manufacturer even make that proprietary shape? If owning an electric mower means buying an entirely new manufactured unit and battery every 10 years, delivered to your door in a shipping container across the pacific, that can't be much better for the environment than using a 25 year old $50 gas mower that's been circling the neighborhood craigslist forever.

I just worry with the continual shedding of older technologies for better ones, that we fail to calculate the costs to replace these technologies and the costs to build new technologies as we get blinded by optimism and profit opportunities. The real rub on the environment more than anything else are our rampant consumerism and the globally extended supply lines needed to fuel that insatiable itch.

Well, there's the CO2 environment, and then there's my personal environment. In my personal environment, I don't want to use a gas mower due to extreme levels of particulate and un-burned gasoline pollution.

Most mowers have a 10 year planned obsolescence lifetime and will die before then. A 25 year old lawnmower probably cost a lot more for the engineering to make it last. Though even then they expect 3 years, but that is using it 40 hours a week so a homeowner doing an hour every Saturday is nothing even over 25 years.

Any simple gas mower you buy off the line today can last practically forever if you just do basic maintenance and store it properly between seasons. They are just pretty simple engine designs that haven't really changed in decades.

I used to be a groundskeeper, and as long as we kept the blades sharp and did basic engine maintenance like changing the oil and filter, we could just abuse a push mower all over the golf course for 50 hours a week summer after summer.

They design the mowers to vibrate apart after 10 years. The engine properly maintained can last a lifetime, but the rest of the mower will not. Golf courses buy a higher end mower (which isn't that much more money) which will last a lot longer.

No idea which lawnmower battery pack you meant. All of them are 18650 elements with the good ones (3A/h, 30A) like 5$/€ retail price. One of them is ~11Wh (say 3.7V) - to get 420Wh you need 38. So the price looks decent retail one - building it yourself with quality elements would be another 25-30 for housing (pref. some polycarbonate composite) and pcb (quality/balancing charger, etc.)

LiIon is a lot more expensive and more energy dense than lead/acid combo commonly found in car batteries.

Drag racer may drop the entire car battery, replacing it super capacitors to reduce weight.

It's most likely an 56 volt Ego 7.5 Ah battery. I bought mine a few years ago on eBay for $200.

Yes, this is the one I was talking about. I looked at retail cells because I was curious and $5 looked about right for retail, but I can't imagine the OEM Manufacturer would be paying that much.

My initial uneducated guess before I did any math or looked anything up was that the BOM cost for the battery pack would have been like $50, but $200 seems more reasonable. I guess a $150 markup isn't that unreasonable, but it is a bit of a sticker shock when you compare the cost of a mower bundle [0] to a bare battery pack [1]. Still, the margin seems fat here. I really am of two minds on this, because I realize what the race to the bottom could do here. I don't want a battery pack that would burn my house down. I want a battery pack that lasts a long time (durable over usage cycles).

I'd love to hear about your experience with the system if you don't mind sharing.

0. $370 Mower + 5 Ah battery + Charger https://www.homedepot.com/p/EGO-21-in-56V-Lithium-Ion-Cordle...

1. $350 7.5 Ah battery https://www.homedepot.com/p/EGO-56-Volt-7-5-Ah-Battery-with-...

It's US where LiIon is presumed 4V nominal, so effectively 42 elements. Pretty nice margins.

Indeed battery pack is where the tool companies make their profit with all of them being incompatible with each other, including Dewalt/Black and Decker (same company different brands) having just a small plastic notch to prevent interchange usage.

-- Edit: durability depends on max charge and min/cut off discharge voltage (something like 4.13v/3.3 would be decent) - you can test those with voltmeter easily, temperature the batteries are run at, and discharge current. At around 400 cycles they should be at ~85% capacity.

You can find x to y battery adapters on ebay, in case you found it as annoying as I did.

$5 is low volume consumer prices. Those cells are more like $3.50 if you go for MOQ 20. Eg. https://www.bulkbattery.com/batteries/18650/samsung-30q-1865...

the 56V assumes 3.75v nominal for LiIon - so I'd guess 3x15 of 2.5A elements. The good ones LG/Sony/Samsung/Panasonic are quite expensive when they come with high discharge current - most of the ebay stuff uses Chinese knockoffs that suffer greatly when discharged over 7-8A but since there are 3 elements in parallel, it should be easy for over 20A/50V, say 1kW.

...now I am really curious what's inside. What are you using the pack for?

This is something I read a lot when I was looking at getting some Ryobi One+ tools. It ended up being that buying the tools bare was quite reasonable, but getting batteries was extortionate. I ended up getting knock off batteries for a third of the price and they've held up brilliantly. Did bring back memories of knockoff printer ink, I wonder if the tools will start having chips to detect knock offs before long.

> a good battery mower may last a very long time

However I’m worried about the availability of the mower’s battery 5-10 years from now. The battery packs have unique shapes, controllers, etc., which might be discontinued or become insanely expensive to replace in the future. If I were to buy a second mower battery as a backup, what would be the optimal strategy for maximizing the total life of my two batteries? Would it be best to:

- never use the second battery until the first one dies

- alternate between the two batteries

- something else?

Batteries degrade while in storage and they degrade with every cycle.

The best you can do is never store it fully charged. Never discharge it fully. Modern tools never let you do that, but if you store a "discharged" battery it will fully discharge(by self-discharge) over time.

The best way is to charge it to 3.7V and then store it and check it at least yearly.

The batteries are a lot cheaper when you buy them with a tool. I think they make the batteries by themselves expensive mainly to nudge you to buy another tool.

I'd say home storage is about $750 a kWh in the UK. Plus installation. What do you think, is the future a domestic 50kwh battery in every house or will they be fewer giant ones owned and run by the power company out of sight?

Well, Tesla currently sells a 50kWh battery that also happens to have a really nice car attached to it for $35000.

That’s $700 per kWh. It stands to reason that home charging systems will soon come down in price, even if they don’t end up largely being eaten by BEVs with bidirectional charging ;)

They sell a 13Kwh powerwall for $6500. That is down to $500 per kWh. Still not great.

If you’re doing lithium.

With lead acid, you can get much, much better bang for your buck - as low as €85/kWh, no problem - and big OPzS cells will last for decades. I just put in 42kwh of storage last autumn for €6500. More like €155/kWh with vent caps, interconnects, longer life rather than the cheapest cells, etc.

If you’re purely doing grid storage, a 5kva inverter/charger would set you back €1800 or so - and that’s basically it.

If you want the same cycle life as LFP cells you can only discharge to 50% though. Pb based cells are advertised in an extremely misleading manner IMO.

Eh? Lithium will last 5-10 years doing full cycles. Lead will last 15-25 doing 80% DoD.

Lead only gets the cycle count it advertises if you don't go below 50% on discharge.

That really depends on the cell type. With OPzS they’re rated to 80% DoD, with C100 as the standard capacity rating used. You’re right that plenty of traction and gel cells get pretty tired pretty quickly with moderately deep cycles - I’ve just educated a friend on exactly this, as he killed two 12v batteries inside of six months by undersizing his storage and drawing too deep - 70% DoD daily on AGM batteries is murder.

In our application, we rarely go below 20% DoD - but we could take them much, much deeper without unexpected implications for their life.

The other nice thing about OPzS is they they’re each a single 2V cell. Means you can monitor for and track down individual duff cells, rather than having a whole battery fail. After 9 months, ours are still perfectly balanced, gravities all identical when charged to when they were new, literally zero problems.

Interesting that you can get a decent number of cycles with 80% DoD. I've seen estimates that put a big drop just going from 45% to 55%, so I assumed going further would just be cell suicide. TIL!

Monitoring is also a nice benefit. I wonder if at some point it would make sense to put bypass diodes on cells (like solar panels have) so that dead cells won't bring down a pack.

Third option: a mid size one in every neighborhood, charged by the neighborhood’s solar and wind (could be either owned by a power company or by the neighborhood)

That gives some economies of scale, and keeps the amount of wiring lower.

I think there is a place of both - and that is the beauty of a free market. In general, larger batteries run by the power company should be more efficient. However there are a few reasons why you also want your own home battery.

- you become less vulnerable to short power outages

- the power companies can't ask much more for electricity than solar plus battery would cost you

- the grid might become more stable, as the battery can smoothe of sudden power demands, also grid fluctuations shouldn't affect you any more

- on the one side, you probably can shave off a few dollars of your energy costs by not storing surplus solar vs. sending it to the grid

- on the other side, home battery companies can't sell at prices higher than what the grid offers

So I think there will be a combination for both, working together to get the costs down and supply more reliable. The number and the size of batteries installed at home in a region depends on the parameters of that region.

I can't see a good case for the domestic batteries. Space is expensive. It exacerbates fire risks. It requires maintenance and replacement. Extra complications for renting. And the grid is already there.

The smaller the "unit" of storage, the more you need. Doing it at grid level makes it easier to be incorporated into grid stability systems too, collecting payments for "fast frequency response".

(Possible exceptions for crofters and islanders)

The "good case" is for home owners with solar, as they can go down to 0% grid usage with adequately sized packs. As long as the price you get for feeding back to the grid is lower than the price of receiving from the grid, each kWh that got produced during the day using solar and consumed in the evening saves the homeowner money.

Plus in the case of a grid failure the batteries can last quite a while if you restrict wasteful usage.

The arbitrage on that has to be pretty thin? If the pack cost X and had to be replaced after Y years, can you recover that from each day's electricity?

Personally I'm on the old feed in tarriff scheme which gives me a fixed price for generation, regardless of export or usage ...

Here in TX (somewhat unusual, granted) I pay about $0.05/kWh for the wholesale power and about $0.04 for the "delivery charges" i.e. being hooked up to the grid, etc.

The truly wholesale market tends to be $0.01/kWh any time other than 11am-7pm and anywhere between "some more" and "lots, lots more" than that during the 11am-7pm window.

At some point it starts to become more economical to install extra solar to make sure I never touch the grid during the day. And eventually as battery prices come down and homes get more efficient it also becomes more economical to install batteries and even more solar to not touch the grid at night.

This may not be how retail power is priced everywhere but I suspect that wholesale power is priced similarly in a lot of places that get some sun and some wind so long as you're not really, really remote. It'll be interesting to see how this all plays out over the coming 5-10 years.

5ct a kWh?! cries in German - here prices are 25-30 or more...

Depends solar with storage is one of the better deals for utility if the system is utility controlled: since you have storage they can decide when to take your power. The big problem with wind and solar alone is when it is on it is on with no care about who wants power. If they can take your power when people want it not when you generate it that is big for them.

Of course the above requires a large amount of management. Right now it isn't worth their while to take your power that way. However this is an opening, an standard system so that the utility can automatically take power from little guys opens up a lot of opportunities that don't exists.

Note that you should expect to pay about $10 a month for the above even if you are self sufficient. It should be worth that to you just to have the peace of mind that comes from utility backup when something fails. You can get that down, but probably at the expense of more equipment than you should reasonably buy and so your equipment costs are subsidizing someone else who doesn't spend as much on equipment.

> pay about $10 a month for the above even if you are self sufficient

This arbitrage is looking worse all the time?

Given that power cuts happen only for an hour or so every few years, I'm happy to buy a couple of LED torches and deal with it. There seems to be an ideological bias to getting off the grid for no good reason? While remaining on the water, sewage and gas grids.

Except for summer fire season in California where we get multi day power cuts when it’s warm and windy.

I think it will have to get much cheaper. Powerwalls are pretty awesome, but still quite a lot more expensive than a good quality lead acid setup, and if lead acid home battery systems haven't become popular yet, it's probably due to price.

I still think it is far better to have a sort of semi centralise place for these Battery just for safety concern. Rather than having a massive battery in every flat. I would guess battery for house in rural area would work. But definitely not for cities.

Higher demand causes lower prices? From the article:

> "But a battery electric car needs so much battery capacity—40 to 100 kWh, thousands of times more than a smartphone—that they've significantly increased the global demand for lithium-ion batteries. That has helped drive additional price declines, which have started to make it cost-effective to use batteries to improve the electric grid."

You need to know both demand and supply to forecast price effects when either or both change. The simplistic assertion that higher demand leads to lower prices is wrong on its face.

I'm no expert, nor an economist, but I think it'd be more correct to say that higher demand inspired investments that resulted in more supply, which grew faster than demand, thus driving price declines.

EDIT: Another inconsistency that bugs me:

> "Frith told Ars that a common battery technology in the last decade was "NMC 111" batteries with equal parts nickel, magnesium, and cobalt. Now companies are starting to move to NMC ratios of 811—with eight times as much nickel as manganese or cobalt. Nickel is two to five times cheaper than manganese or cobalt, so a formula with more nickel is cheaper to produce per kg."

So does the "M" in NMC refer to magnesium (as stated first), or manganese (as stated second)?

Over the long run, higher demand can absolutely lower prices.

In the short-term, obviously higher demand increases prices if production is held constant.

But if there's no obvious constraint on production (e.g. on resources/land/employees/etc.) then yes, over the long-term higher demand usually generates larger-scale businesses/factories which can invest in more efficient production and produce lower prices, and pay off initial investments.

Of course, this won't apply if there aren't further economies of scale or investments to recoup.

The article seems to be quite clear that this is what it's talking about. I don't think it's making the "simplistic assertion" you're assuming it is -- it's just referring to the concept of economy of scale which most people are familiar with.

The M in both NMC 111 and NMC 811 should be manganese. It's also a mistake that nickel is "cheaper than manganese or cobalt". It is certainly cheaper than cobalt, but much more expensive than manganese. It's still better, since cobalt is quite expensive and there can be some ethical issues with the supply chain of cobalt, but if it were possible to make NMC 181, that was mostly manganese, it would be better.

As for your first point, higher demand typically causes higher prices in the short term, then often lower prices in the medium term due to oversupply of investment, and eventually lower prices in the long term, due to economies of scale.

I'd say higher demand led to more R&D. Supply alone wouldn't drive the price declines, as it used to cost too much to produce high battery capacity so there was a price floor. As demand increased, justifying the R&D helped break down that floor. That and government dollars.

Somewhat surprisingly, perhaps, there is still potential in lead-acid battery technology. Ecoult [1] is combining them with supercapacitors to try to get the best of both technologies for grid-scale storage.

[1] https://www.ecoult.com/

That article was somewhat disappointing, but maybe I've been watching too much Tesla battery investor day hype.

Between the tabless design patent, the maxwell dry electrode, and other chemistry improvements, I'm interested to see what the battery presentation boils down to in terms of improved density from the dry cathode and cost improvements from tabless and the various chemistries discussed.

That million mile reliability is nice, but I'm really hoping for under 100$/KWhr at pack level with improved density to enable 400+ mile ranges.

The Tesla prototype around the Nurburgring had me speculating about really dense batteries that enabled a much lighter racing car than what the Taycan was limited by.

For cars, price and density are very important, and Tesla will certainly improve in those specs too. But for energy storage, longer durability directly translates into an effectively lower price. As power companies often invest in the scales of several decades - a power plant often can be run for 5 decades - the costs are calculated over those time spans.

Is the durability of batteries also improving?

Having a significant improvement in this area would have a magnificent effect on some industries. Making batteries last twice as long (e.g. from 2000 cycles to 4000) would basically reduce battery cost by a factor of 2 for trucks, public transport or grid energy storage (6y to 12y lifespan if cycled once per day).

>"In 2010, a lithium-ion battery pack with 1 kWh of capacity—enough to power an electric car for three or four miles—cost more than $1,000. By 2019, the figure had fallen to $156 [...]

Forecasters project the average cost of a kilowatt-hour of lithium-ion battery capacity to fall below $100 by the mid-2020s."

60 Minutes once did a segment on batteries made from seawater and dirt. They were large (low power density), but very cheap, and perfect for grid storage.

Haven't heard anything about that since.

I think you are refering to Aquion Energy. The company sputtered and was sold to a Chinese equity firm. The product looks like it is dead in the water but, it still was a great idea. The intention was to use the cheapest, safest, and most abundent materials to create a battery. It had low power density and output but, they had a solid lifespan and were environmental sound.


Neither seawater or dirt sound like they address the anode or cathode, which seem to be pretty major challenges when it comes to rechargeable batteries.

BTW, speaking of seawater and dirt forming a battery, I recently needed a way to measure underground corrosion of buried copper pipe, and it went down a great little rabbit hole uncovering documents such as this [0]. It was fun to go put a voltmeter across various ground-coupled conductors in my home to see what, if any, voltages were present, with the earth serving as part of a battery.

[0] https://archive.org/details/CAT78694105

Li-ion… meh

> Batteries have already gotten six times cheaper within the last decade,

Pedant here:, but you can't get "six times cheaper." You can get one-sixth as expensive, but "six times cheaper" implies some sort of relative comparison being made about rates, not absolute values.

The same issue is apparent in the HN title ("costs fell six-fold."

IMO In colloquial English six times cheaper means 1/6th the price. What a phrase means is very much dependent on how the speaker and the listener interpret it.

As far as I know so far most of the lithium used has been from existing copper mines, where there's a lot of lithium, so that's made pinpointing it and extract it fairly cheap. I remember reading there's 5-10 years worth of lithium left in these mines. It will be interesting to see what happens once we need to start looking for new sources again.

The vast majority of lithium does not come from copper mines, but from lithium mines such as the Salar de Atacama in Chile https://www.lithiumchile.ca/project-item/salar-de-atacama/ with evaporation and spodumene mining in Australia: https://www.albemarle.com/businesses/lithium/products/spodum...

There is a lot of lithium potential in places such as the lithium triangle in South America.

The cathode material is pretty much the sole contributor to material cost. Plastic, anode, casing, current collector plates/terminals all make less than a quarter of the price.

Main contributor to the cathode powder price is cobalt, and its unpredictable price: bad weather in Congo? Prepare to see the price increase n-fold within few weeks. Nickel comes second, to much lesser extent.

LFP cells use radically different cathode chemistry from common cell types, and use no cobalt, or nickel at all, hence the low price. We dump phosphates on in the fields by gigatonnes after all.

Cobalt futures are traded on the LME. So factories can lock in fixed prices for cobalt in advance.

This is not a deep market, with daily value traded in the millions of dollar (not hundreds of millions or billions).

You can also go to your bank and have them sell you a derivative over the counter.

It won't help your average price (just the opposite), but it can take the unpredictability out.

The next "iron ore boom" in Australia is supposed to be lithium. There's a lot of deposits waiting to be commercialised apparently.

Just waiting for some other country to start building enough battery factories. Because actually making anything in Australia seems to be impossible.

A common element - more common than lead, about the same as cobalt. I wouldn't be surprise if more lithium mines are waiting to be found.

> Because actually making anything in Australia seems to be impossible.

I keep hearing that. Could you expand on this bit? For those of who are are far away and have zero idea why. While I know labour cost and protection are high. I would have thought battery factory is now highly automated.

More a mindset than economics. Mining is what Australia does. No-one really knows how to set up a manufacturing base. Investors aren't willing to invest in it. There's no end of stories about how it's too small of a domestic market, and too far from export markets (all of which are true for lots of other countries with thriving export markets), or that the labour costs are too high (also true for Germany, which has a thriving manufacturing export industry). And everyone's rich from mining, so why bother?

Same for the solar industry. If there was ever a place to build enough solar to power the planet, it's Western Australia. We could build the batteries, too, from local ingredients. But it's all too hard and too complicated and why do that when we can make enough money from just mining the lithium?

> Mining is what Australia does.

There's another odd perspective on this in Jared Diamond's book Collapse, in the "Mining Australia" chapter:

> Most of Australia's remaining agriculture is in effect a mining operation that does not add to Australia's wealth but merely converts environmental capital of soil and native vegetation irreversibly into cash, with the help of indirect government subsidies [...]

That is, similarly to how mining activity depends upon consuming non-renewable stocks of ore or fossil-fuel* that can be extracted with sufficiently low energy cost, the argument is that agricultural activity depends upon consuming stocks of high-quality soil at a much faster rate than the stock of high-quality soil can be being refilled. If the rate of consumption is much higher than the rate of production then high-quality soil is effectively non-renewable.

* i guess fossil fuels are also "renewable" in a literal interpretation of the word that it is possible to refill stocks, given a long enough time horizon (billions of years?) & a willingness to take a bit of a gamble that the conditions for large-scale fossil fuel creation will recurr, provided the rate of consumption of fossil fuel slows.

This was/is certainly true of the vast sheep stations. Sheep farming was a disastrous decision for Australia, made because British garment manufacturing needed more cheap wool[0]. IIRC this is part of that chapter of the book.

But recently, there's been much more of a move to less destructive practices. Lots of mediterranean-type farms (olives, wine, etc) more suitable to the soil and climate.

[0]anecdata: in the late 80's I worked on an English sheep farm, at 100 sheep to the acre, and cut their toenails. I also worked on an Aussie sheep farm, at 100 acres to the sheep, and had to kill flyblown sheep being eaten alive by maggots. Crazy contrast.

Sounds like https://en.wikipedia.org/wiki/Dutch_disease

Australia's high min-wages + high prices of everything sounds like https://en.wikipedia.org/wiki/Baumol%27s_cost_disease

I imagine it's a political live-wire to suggest heavily taxing the mining operations?

Don't get me started. There's a 4-hour rant I have about that hehe

Aussies think that they're in competition with other mining countries to supply the Chinese. From a mining executive perspective, I get this. You need all that revenue now.

But from the country's point of view, it's a disaster. Non-renewable resources are being exported as cheaply as possible in as large a quantity as possible. The royalty system works on revenue earned, so the taxes are tiny compared to what they could be if the aim was to maximise the value of each Kg of ore.

So yes, suggesting that we tax the exports more brings cries of "making Australia uncompetitive" and that it'll destroy the mining industry, and then what will we do?

Crazy. Sad, too.

That article on the Dutch Disease is spot on

>or that the labour costs are too high (also true for Germany, which has a thriving manufacturing export industry)

Germany can get packaged cheap labor from East of Europe when they need it.

Infact, a lot of German companies have their labor intensive units in East.

Only highly automated manufacturing and management/finance and R&D work in done in Germany.

Australia doesn't have the same advantage which Germany have had for years now:


Wouldn't you be killed in this distribution part of the solar power for the world story?

What form would you be shipping the energy in?

> What form would you be shipping the energy in?

One option is hydrogen. There's some amount of government & think-tank produced research arguing for australia to pursue a "hydrogen economy". E.g. https://www.industry.gov.au/sites/default/files/2019-11/aust...

From skimming through the report, there are also applications to use directly use hydrogen as an input to produce ammonia, and also an argument that existing means of shipping ammonia could be used to ship hydrogen, conditional on research that can extract hydrogen out of ammonia with low energy input.

I don't have a handle on what kind of policies would be needed to encourage private investment in hydrogen vs coal, gas, oil (assuming it is even a good idea). There's a graph of estimated prices of hydrogen vs alternatives in various uses in the report (search for "breakeven"). It does not look price competitive in many applications, but I assume the comparison does not include price adjustment that account for the externalised environmental costs of one energy source versus another.

Regardless of hydrogen or solar or batteries or whatever, a carbon tax with a price set to help internalise the externalised costs of greenhouse gas emissions would be a great way to push activity in a better direction, regardless of if that is hydrogen or anything else that strikes a good combination of efficiency & low greenhouse gas impact. Perhaps the carbon tax could be rolled out nationally with tariffs put in place to penalise the import of goods & services produced in other countries that did not yet have an comparable carbon tax installed.

I always liked Buckminster Fuller's idea of superconducting cables distributing electricity around the world.

waves hands distribution is a different problem. Someone else will solve that.

I've seen more expensive plans started with bigger holes ;)

Submarine HVDC should work.

In modern times there's a definite case of Dutch Disease going on with the economy some sectors have been very successful and have sucked all the air out of the rest of the economy. Why this has been allowed to happen is due lot of cultural and political reasons that go back a long way, if you look closely you will see a lot of decisions that have terrible economics over the long term but are based on some political reasoning. The quick summary is that the ideas about what the economy "should be" since colonial times has been based around extraction rather than value adding.

Lithium mining has little to do with copper.

There's an abundance of lithium in the oceans, but it's heavily diluted, so currently there's no large scale process in place to obtain it.

But it is possible in principle, just expensive using the technology of today.

I know nothing about what it'd take to extract elements from seawater, but I've heard people say similar things about gold and uranium. I wonder if the economics for "mining" seawater become more favorable if you try to extract multiple types at once, maybe in a pipeline. Extract the uranium, then the gold, then the lithium, etc.

Lithium and uranium are basically the only two things that could be worth extracting from ocean water besides salt itself. It’s not crazy expensive to do it.

And you save a bunch of money by using the brine left over from desalination. But you can find naturally occurring brines with higher lithium concentration, so why bother with ocean water?

...in other words, lithium is plentiful, and the cheapest is from places like South America where it is extracted from brines similar to how sea salt is extracted, so the process is cheap, too (which is why we don’t really do hard rock mining of lithium any more... sea salt like evaporation ponds are just much cheaper).

(Another interesting source is the brines from geothermal power stations... there are some at power stations I California that are rich in lithium and there are efforts to extract it... two birds and one stone. Example: https://www.azocleantech.com/article.aspx?ArticleID=1066 )

Perhaps with desalination can produce other materials besides drinking water?

Desalination is extremely energy intensive to get potable water. If you're using RO extraction it's 10:1. 90-95% of water is returned back to the sea. That little bit of potable water is just the bonus of compressing saltwater into saltwater.

We have a systemic problem, our economic system is based on productivity and that is a opposite goal to efficiency. Every time we gain efficiency we have a choice of keep our consumption and pay less for electricity but we choose to increase consumption, for instance any improvement in phone batteries is counter by more powerful chips. Home appliances have improved but we choose to have more appliances instead of less energy consumption. This is called jevons paradox [1] and it needs to happen otherwise there is no profit or job creation.

[1] https://en.wikipedia.org/wiki/Jevons_paradox

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