Director, Market Analysis
Energy storage has come to play a starring role within NextEnergy’s NextEnergy’s smart home. The battery is a lithium battery system supplied by Bosch, commercialized in Germany, similar in some ways to the much-hyped Tesla Powerwall. However, the Bosch battery includes the inverter needed to convert solar generated DC to AC power for the home. In the case of NextEnergy’s smart home, the inverter connects to our network and allows us to use advanced controls to make smarter decisions about the source of electricity used in the home. This may come from the battery, the bi-directional capable electric vehicle, the solar panel directly, or of course the grid. One of the great challenges facing the battery industry, whether it’s in the home, commercial building, grid storage or within electric vehicles, continues to be the cost of the battery. But getting a return on your investment from a battery pack isn’t just focused on the cells anymore.
The challenge of battery costs has a lot to unpack: The cell prices have been steadily decreasing, and now the other components within a battery pack are beginning to take center stage. Reducing cell costs have been a key focus area because they drive a significant part of the cost.
A battery pack includes the pack materials, and the battery management system (BMS), which is kind of the unsung hero of the battery world, monitoring cells, safety, and charge/discharge performance. According to a Clean Energy Manufacturing Analysis Center analysis of the Li-ion manufacturing, the cells account for 60% of a plug-in hybrid electric vehicle cost, while the other components of a battery pack comprise the remaining 40%. Within a stationary energy storage unit aimed at commercial building applications, the pack which often includes the inverter (or balance of system) can account for up to 74% of the system costs according to 2014 research from GTM.
Perhaps because the cost of battery cells continues to fall and the demand is strong enough that market capacity is starting to fill the automated manufacturing lines, the industry is recognizing the challenge of the cost of the remaining pack components. New Power Electronics Industry Collaborative research that NextEnergy worked on is pointing to potential gains from moving inverters to wide bandgap materials which will help reduce the overall system costs and size. The entrepreneurial world is also taking note. NextEnergy is in the midst of hosting another I-Corps Energy and Transportation cohort, and this year it includes a team from the University of Michigan focused on improved battery management systems featuring lower cost sensors and improved algorithms for calculating cell expansion due to thermal events versus normal charging events. One NextEnergy partner, Jolt Energy Storage Technologies, is on the path to commercialize a technology that may reduce the complexity of BMS as well.
Three upcoming events will highlight, not only the role of cells in the market, but the challenges facing pack technology as well. The Advanced Automotive Battery Conference on June 14 to 17 features a track focused on pack engineering with speakers from FiatChrysler, NREL, General Motors and others. This event will be followed up in July with another key event, the PlugVolt Battery Seminar on July 26-28. This event has a full day dedicated to automotive applications, followed by a day dedicated to stationary energy storage applications. Rounding out the summer in Michigan will be The Battery Show happening September 13 to 15. This event has a track focused on next generation battery cells. Overall, if you are looking to drive cost out of a battery pack, then these events are a good place to get an understanding of the systems that support cells and why they have such a big footprint on the cost of the system.