19Aug 2016

As I pondered over the past couple of weeks what might be a befitting topic for this 100th post, a group at MIT announced that they discovered how to make batteries with double the energy. Of course, the operative word in the press release was “first-prototype” which means that it might be a long while before, that is if, we see commercial deployment. However this announcement was the catalyst to focus this post on the state of the lithium-ion battery: In other words, if we ignored future inventions, what is the best that we can expect from the lithium-ion battery today across a number of applications.

For the vast majority of modern applications, the lithium-ion battery is capable of delivering the requisite performance. So if you are wondering why is it that most users complain about the battery, I will use an analogy of a jigsaw puzzle. The solution to storing electrical energy involves many pieces, like the pieces of a jigsaw puzzle. These pieces include the battery materials, chemistry and design, which is often provided by one party: the battery manufacturer. But also a critical piece includes the power management of the device and system, in particular the electronics and software needed to monitor how the energy is efficiently used, say by the apps on your smartphone. An equally critical piece is the battery management intelligence, which is what we do here at Qnovo, that is responsible for the integrity and efficient operation of the battery. If water use is to represent energy use, then the battery is the reservoir; power management is akin to water conservation, something we, Californians, are familiar with; and battery management is ensuring the integrity of the reservoir and its contents, making it large and free of toxins.

Separately and individually, each piece of the jigsaw puzzle is today at an exceptional state of the art for consumer electronics, energy storage, and electric vehicles. For example, energy density of batteries in commercial deployment is already near or at 700 Wh/l. This energy density is sufficient to power smartphones comfortably for a full day of use, or power an electric vehicle for 300 miles. Power management has become quite sophisticated, especially in consumer electronics where now the operating systems, e.g., Android OS and iOS, are asserting clever decisions on how apps may use power. Battery management intelligence has also become quite sophisticated, peering deep into the battery in real time and ensuring its continued health and integrity under extreme operating conditions.

But now imagine for a moment trying to build a jigsaw puzzle where multiple players share in putting the puzzle together, or worse yet, each player owns a subset of the puzzle pieces, but not all the pieces. Now you can imagine that putting the puzzle together can get quite complicated. You see, battery vendors know how to build the battery itself but tend to be quite novices in power management and battery management intelligence. System integrators and OEMs tend to have plenty of experience in power management but their knowledge of the battery chemistry tends to be limited. As to battery management, both battery vendors and OEMs have historically under-estimated its need and are playing catch up.

This, for example, begins to explain why Tesla Motors wants to own all these three pieces of the puzzle, beginning with their widely discussed Gigafactory but also their less-advertised efforts in power management and battery management. Apple is also in the same league. While Apple does not manufacture their own batteries, it is widely known that Apple does design their own batteries as well as having growing expertise in both power and battery management. But these tend to be early adopters who have recognized that they need to lead in owning and putting the pieces of the puzzle together. There are other giants who are in need of playing catch up, and they include the likes of Google, Microsoft, Facebook…as well as industrial players who are eyeing batteries for stationary energy storage and electric vehicles. Gradually, they are all beginning to make power and battery management integral to their long-term strategies.

Historically, system integrators and OEMs treated the battery as yet another component they source from suppliers, like the display or other electrical or mechanical components. But this model of outsourcing the battery expertise is beginning to fray. First, battery vendors are hitting the limits of materials and are struggling to meet the increasing demands of their customers without the use of intelligent power and battery management algorithms. Second, there is a growing discomfort, and I might dare say mistrust, between the OEMs and system integrators on one side, and the battery vendors on the other. Third, with the advent of cheap, meaning both inexpensive and lower quality, batteries form China, the business model of the traditional battery vendors, in particular Sony Energy, Samsung SDI, LG Chem is under pressure. A quick evaluation of their financials is sufficient to show they are not healthy. Sony recently announced the sale of their battery business to Murata Manufacturing. These shifting dynamics complicate the necessary tasks required to put together this battery puzzle and are forcing participating companies to seek different alliances.  For example, see the growing alliance between Tesla and Panasonic as well as between GM and LG Chem. In China, witness the growing influence of BYD in making batteries and making electric vehicles. The result is that the optimal battery system that incorporates the right battery, right power management intelligence, and right battery management intelligence is accessible to limited few organizations that either have the means to be vertically integrated or put together the necessary alliances.

As the reader can gather, the challenges in offering a great battery experience is really not technical in nature, but rather have economic and organizational origins. For consumer applications, the technology already exists to build elegant smartphones with battery capacities in excess of 3,000 mAh, charging very fast at 1 to 1.5C, and lasting 800 to 1,000 cycles. These specifications give the average consumer an excellent overall battery experience. For energy storage, the challenge is not the battery chemistry but rather hitting the right price points and building out comfort in the specifications from extensive testing. For electric vehicles, the cost of the battery is rapidly dropping. The Chevy Bolt and the promised Tesla Model 3 are prime examples of vehicles targeting the broader population at an increasingly affordable price. That is not to say that engineering innovations and continued disciplined product improvements are not necessary; they are important. But the perception that the battery industry is in dire need of a large breakthrough in technology and materials is not well founded. Instead, there is a bigger need for all the players around the battery jigsaw to learn to work together and leverage each other’s expertise and technologies. This is happening; in the process, we will continue to see a race to build up intellectual property, patent ownership, expertise, and skills by the various participants.