Electric vehicle battery breakthrough not likely before 2020

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Another setback for liberal policy makers and environmental activists who promise enormous reductions in emissions as a result of converting America's automotive fleet from gas-powered to electric vehicles as soon as possible. A new study by the Boston Consulting Group (BCG) says it won't happen before 2020, even if, as many advocates propose, the government mandates it.

The reason is the same as it has been for decades – limitations of battery storage capacity mean electrics simply cannot go far enough soon enough at a competitive cost to enable them to offer desirable transportation products at prices that make them affordable and the kinds of functionality that make them desireable to consumers.

“For years, people have been saying that one of the keys to reducing our dependency on fossil fuels is the electrification of the vehicle fleet,” said Xavier Mosquet, Detroit-based leader of BCG's global automotive practice and a coauthor of the study. “The reality is, electric-car batteries are both too expensive and too technologically limited for this to happen in the foreseeable future.”

The BCG study points out that the lithium-ion batteries likely to be used in most electric vehicles in the next decade are lighter and more powerful than the nickel-metal hydride units used now in hybrid electric vehicles like the Toyota Prius and Honda Insight.

Auto makers have assumed electric vehicle batteries must reach the same cost-per-kilowat hour (kWH) of power level as that of consumer electronics, which between $250 to $400 kWH. Currently, lithium-ion battery packs can produce more power and lasts longer than nickel-hyrdide units, but do so at a prohibitive cost of $1,000 to $1,200 per kWH.

Auto makers have said for years they assume technology advances and increasing consumer demand will drive down the cost per kWH of the lithium-ion units to levels comparable to those of consumer electronics batteries. But the BCG study suggests that simply isn't going to happen before 2020 at the earliest.

In addition to having to get costs down significantly, lithiom-ion batteries to be used in cars and trucks must meet much more stringest safety and reliability standards than other batteries.

Even so, BCG predicts impressive growth in the world-wide electric vehicle fleet, with approximately one of every four new cars sold in 2020 being either fully electric or hybrids in the U.S., Western Europe, China and Japan) for total of 14 mllion or so. That's not exactly a small market, being worth an estimated $25 blllion, according to BCG.

“This burgeoning market will be about triple the size of today's entire lithium-ion-battery market for consumer applications such as laptop computers and cell phones,” said Mosquet.

To read the entire BCG study, go here.

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