Electric-car batteries: $100 per kwh before 2020, $80 soon after?


Lithium-ion cell and battery pack assembly for Nissan Leaf electric car in Sunderland, U.K., plant

Lithium-ion cell and battery pack assembly for Nissan Leaf electric car in Sunderland, U.K., plant

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Modern electric cars have developed to the point where range itself may become less of an issue than the cost of providing it.

Automakers can create longer-range electric cars simply by installing larger battery packs, but that adds significant cost to the car's single priciest component.

Just ask Tesla, which sells multiple versions of its Model S and Model X with ranges of over 200 miles—but none priced lower than $70,000.

DON'T MISS: Electric-car market share in 2020: estimates vary widely

Still, the price of the lithium-ion cells used in electric-car battery packs is going down—and it's doing so at a much faster rate than predicted.

Electric-car battery prices could drop below $100 per kilowatt-hour by 2020, and below $80 per kwh not long after that, reports WardsAuto.

Citing discussions with "EV experts" at last month's Consumer Electronics Show, the industry trade journal indicated that battery prices could be on the verge of achieving a crucial milestone.

2017 Chevrolet Bolt EV

2017 Chevrolet Bolt EV

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Many industry analysts believe a cost of $100 per kwh is the point where battery-electric cars become cost competitive with internal combustion.

Current cost levels also show that U.S. Department of Energy estimates from 2010—when modern electric cars first became available in large numbers—were pessimistic.

At the time, the DOE determined that the industry should aim for cell battery-pack costs of $125 per kwh by 2022, but the agency did not see a clear plan for achieving that goal.

UPDATE: After this article was published on February 9, the DOE clarified that its 2010 goal referred to battery-pack costs, not cell costs as originally stated. Costs of related items such as battery management and cooling systems were reflected in that estimate, which also specified reaching the $125-per-kwh goal by 2022.

ALSO SEE: Electric-car battery costs: Tesla $190 per kwh for pack, GM $145 for cells (Apr 2016)

While more affordable long-range electric cars are beginning to appear, a future decrease in prices to $100 per kwh would still be a game changer.

The 2017 Chevrolet Bolt EV has an EPA-rated 238 miles of range, achieved with a 60-kwh battery pack, at a base price of $37,495 (before federal, state, and local incentives).

GM product chief Mark Reuss confirmed to Green Car Reports a cell cost of $145 per kwh for the first production Bolt EV off the line.

Tesla Model 3

Tesla Model 3

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But lowering cell prices to the anticipated could cut $4,000 off the Bolt EV's price, in Wards' estimation, once the additional costs of the battery pack are added to the total cell cost.

The other confirmed mass-market 200-mile electric car is the Tesla Model 3, unveiled in prototype form last March. It is supposed to start production before the end of this year.

Tesla previously quoted a 215-mile range for the Model 3, and a $35,000 base price before incentives.

MORE: 2018 Nissan Leaf: what we know so far about next electric car (updated)

The Silicon Valley automaker will rely on economies of scale from its massive "Gigafactory" cell and battery-pack plant in Nevada to achieve that combination of range and price, which it says will make the Model 3 profitable.

A second-generation Nissan Leaf will be coming as well, and is expected to offer at least one configuration that achieves 200 miles of range.

If cell prices really do drop to $100 per kwh or less in the next three years, expect many more mass-market, long-range electric cars to join those three sooner rather than later.

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