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Renewable/Efficiency/Storage Progress so fast even ‘innovators’ find it hard to keep up …

February 17th, 2016 · No Comments

We are seeing extraordinary shifts across virtually every technology arena even though, especially in areas of large-fixed infrastructure (buildings, energy systems, etc …), it can sometimes be hard to see the change.

Whether solar pv or wind pricing, the ability to squeeze out efficiency in systems (buildings, vehicles, machines, etc …), or battery capacity per pound, the pace of change in systems commercially available is often hard to comprehend. As the Department of Energy has put it, we are living through a Revolution NOW!

DOE on on LED light bulbs: price nosediving, installations skyrocketing

With the breadth and pace of change in the energy market, it shouldn’t surprise anyone that it is hard even for those pushing innovation to keep up with that pace of change.

“Innovation” is certainly a strong thematic in government energy policy discussions around the world. The announcement of the ‘billionaires’ club’ Breakthrough Energy Initiative provided one of the major ‘side’ elements to the COP21 in Paris.  Associated with that, a pledge by major governments to double energy R&D funding by 2020.

Building on this, four major ‘names’ (Arjun Majumdar (Stanford, first head of ARPA-E), John Deutch (MIT), George Schultz (former Secretary of State), and Norm Augustine (former CEO, Lockheed Martin)) have called for a major private-sector push for energy innovation.

The concept is interesting. In essence, seek to create ten ten-Corporation initiatives groups. Each of these 100 firms would commit to $10M/year in funding, for a total of $10B over a decade, to develop breakthrough energy options through the innovators’ valley of death into broad commercialization and deployment.

each Energy Innovation Entity would be supported by roughly 10 companies, each committing about $10 million a year for 10 years — a “10-10-10” mechanism.

Lots of challenges in this concept. A bit much focused on ‘develop tomorrow’s options’ without mentioning today’s and, well, a concept for business cooperation that seems at odds with most firm’s corporate governance approaches and …  However, still an interesting concept.

Embedded within the discussion, however, an example of just how hard it can be for ‘innovators’ to keep up with the pace of change. The following is the authors’ major example of where large-scale private business investment is required.

Take, for example, advances in battery technology. A battery that costs less than $100 per kilowatt-hour with a lifetime of more than 1,000 cycles would be a game changer for offering affordable and reliable renewable electricity across the world. Today’s lithium ion batteries cost three times more.

Yes, $100 per kWh is generally see as a critical threshold for making EV vehicles truly cost competitive with traditional gasoline vehicles on purchase price (and much less expensive to own).  The problem is found with “today’s” — or at least how one thinks about it.

Batteries have been nose-diving in price.  In the Energy Innovative Entity concept OPED, the authors certainly imply that getting from $300 to $100 is unlikely to occur with lithium ion batteries without some form of intervention like they suggest (note, $1B is a relative pittance in the battery world) and is a stretch goal requiring major intervention and significant time to achieve it.

That, however, does not comport with “today’s” reality.

The Chevy Bolt, being built today, has batteries that General Motors is buying at $145 per kilowatt-hour capacity.  GM released that price information five months ago.  And, GM forecasts achieving $100 per kWh battery pricing by 2022 in the normal course of business.

GM Battery Cost Price Projections

Note that the  $145/kWh price is what GM is paying today.

The actual price today (okay, five months ago — at least) is less than half what the authors cite.

With the rapid advances in battery density and rapidly lowering costs, the GM graphic above is likely pessimistic about what we will actually see in the market place.

It seems plausible that the $100 per kWh battery target will be broken before 2020.

Simply put, the advances in energy systems (and, well, across virtually every field of technology and science) are going so rapidly that even those most concerned with ‘innovation’ are having a hard time keeping up.


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Tags: electric vehicles · Energy