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EV, PHEV & HEV Battery Cost Reductions

Image From: : Nissan Leaf EV 2011

Vehicle Energy Storage System Cost Optimizations

Most of the research in advanced automotive energy storage systems (ESS) is focus on improving the performance of the battery cell chemistry and active materials.

There are other less complicated areas of the ESS that can be optimized to dramatically reduce the costs of electric energy storage systems for electric, plug in hybrid and hybrid vehicles.

The one topic that all people involved in the electric vehicle industry agree on is that batteries cost too much. Most of the effort has been on chemical and material science improvements in the active materials of the battery. The anode and cathode in an electric vehicle battery only constitutes towards 20% of the price, falling to less than 10% in hybrid applications.

Easier Problems Ignored

If we are really going to focus on reducing the price of batteries, the focus needs to be on reducing the cost of the total energy storage system. Non-cell pack costs represent between 25 - 75% of the total battery system cost in EV and HEV battery packs, respectively.

While active chemical and material science component research and development continues, overall cost reductions are hindered by powertrain voltage and vehicle packaging requirements. Inactive material in a cell represents the largest potential cost reduction opportunity.

Development Time Delays
Once a critical innovation is found, it can take 18 months to validate the new cell technology. Up to another 2 years is required for vehicle pack level development. A new development found today is almost four years away from production. High speed large volume multi-billion dollar manufacturing investments for ROI performance also hinder technological progress.

ESS Control and Monitoring

Battery control and cell balancing components represent another 30% of the ESS costs. When these systems are standardized and produced at large volumes with leed times of less than six months, substantial cost reductions can be realized.

Enclosures & Harnesses

The mechanical enclosure and wiring hardness connections are another area where cost reductions can be realized. These components also have leed times in excess of 18 months, while novel configuration and layout optimization is lacking because vehicle electrical designs favor external layout over ESS system integration.

Integrative Design & Collaborative Development

Designs can be optimized to reduce wiring costs, and this needs to be recognized and considered during a vehicle’s electrical architecture design and requires advanced collaboration between the battery pack designer and the vehicles electrical system architect. Wire harness optimization and standardization can contribute to ESS cost reductions.

Thermal Management & HV Connectors

The last two significant non-cell pack cost drivers are thermal management and connectors, which often result in hundreds of dollars of costs add to the ESS system. High-voltage connector sets are one are where cost optimization has yet to be realized, for what is basically copper-flashed plate in a plastic or cast molding. Standardization and volume production of these connectors needs to replace small scale application specific connectors, to yield another area of substantial ESS cost reductions.

Looking at the Big Picture

The majority of a pack’s non-cell components have yet to be cost-optimized. The pack’s electrical and electronic controls represent a significant and possibly short-term cost-saving opportunity. As vehicles are designed from the ground up, rather than adopted for conversion, further strides can be made in optimizing mechanical pack and thermal management costs; lastly but by no means least, purchasing and commoditization pressure needs to come to bear on wiring and connector costs.

Work Cited
Condensed, Abstracted, Summarized, Quoted and Consolidated from the following article:

Perspective: Not all reductions in battery costs are found underneath the microscope
8 March 2011 by The Townsend Company

The Townsend Company LLC is a consultation and business development practice to help companies wanting to enter, grow or become more profitable in the alternative energy market. Prior to founding the company, Glynne Townsend, President and CEO, led the revenue growth for A123 Systems in the automotive and grid markets. For additional information, please contact:


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