Advanced Propulsion Centre UK Limited – Written evidence (BAT0018)

 

Batteries

 

Answer question 2

 

Advances in Batteries: Data from Bloomberg New Energy Finance suggests Li-ion battery pack prices, which were above $1,100kWh in 2010, have fallen 89% in real terms to $137/kWh in 2020[1]. However, it is likely that this $137/kWh will only be available to vehicle manufacturers who can buy in bulk and for certain battery chemistries. More niche and specialist players, (many UK vehicle manufacturers), will need more expensive chemistries and do not command the purchasing power to access lower costs. The key point is, batteries will be differentiated across vehicle types e.g. volume passenger car, performance passenger car, heavy goods vehicles (HGVs), and the off-highway sector. Batteries for aerospace and stationary storage will require different approaches. The Advanced Propulsion Centre (APC) in collaboration with WMG, the Knowledge Transfer Network and the Faraday Battery Challenge (FBC) published a report that bundled various applications together[2]. The chart below plots different applications that will need batteries based on their energy and power density requirements. There are four distinct categories: 1. Energy focused, cost sensitive / 2. Power focused, cost sensitive / 3. Power focused, weight sensitive / 4. Energy focused, weight & power sensitive

 

 

Energy focused, cost sensitive: A primary focus of the battery industry over the last 10 years. Strategies to achieve cost reduction in batteries are reflected in the Automotive Council’s Electrical Energy Storage (EES) roadmap report published by the APC in February 2021[3]. In the short term, removing cobalt from cathodes by transitioning to more nickel rich versions can reduce costs. There is scope for advancing the energy density of cheap lithium-iron phosphate (LFP) chemistries which possess no critical materials like nickel or cobalt. In the medium term, transitioning to manganese-rich cathode chemistries can reduce costs further. Innovations in battery pack and cell designs are expected to reduce costs. Cell-to-pack and cell-to-chassis concepts eliminate costly structural and thermal elements by removing the “module” stage. Standardized cell formats within and across large vehicle manufacturers are enabling reduced costs through economies of scale. VW’s “unified cell” design and Tesla’s 4680 cell are prime examples of visionary OEMs enacting this now. Longer term, there is opportunity for some applications in the energy focused, cost sensitive category to transition away from traditional lithium-ion based chemistries. Sodium-ion based provide a more abundant, cheaper base material than lithium and use the same manufacturing process as lithium ion (Li-ion), making a transition easier. While there is some reduction in energy density, the recyclability and inherent safety of sodium-ion batteries makes them attractive for applications like grid energy storage and urban mobility vehicles with high utilisation. Other cost-effective chemistries are lithium-sulfur (Li-S) which provide both enhanced gravimetric energy density and lower costs through the elimination of nickel and cobalt. If issues surrounding cycle life and discharge current can be overcome, the enhanced gravimetric energy density of Li-S over Li-ion makes it an attractive candidate for some aero applications, buses, and HGVs.

 

Power focused, cost sensitive: Anything that delivers short bursts of work but is not the main source of traction is the focus of this category. Achieving good power density at an affordable cost is the main driver. High-volume hybrid passenger cars, some off-highway vehicles as well as hybrid rail applications align with this battery category. The APC’s EES Roadmap identifies several strategies to increase power density, but these tend to increase costs. This is because power dense cells are created through altering existing energy dense Li-ion cells. For example, lithium iron phosphate chemistries are often tailored to deliver high power. This is achieved through manufacturing thinner electrodes with smaller particle sizes which increases chemical processing and cell assembly costs. Like the trends emerging in energy focused, cost sensitive, achieving a consolidated power cell format would enable economies of scale to be achieved. Sodium-ion batteries can be tailored for high power, cost sensitive applications. French company Tianamet were recently awarded grant funding alongside Plastic Omnium to develop 48V battery packs for hybrid vehicles. US company Natron Energy are developing rapid charge and discharge sodium-ion batteries aimed at data centres, electric forklifts and electric vehicle rapid charging stations.

 

Power focused, weight sensitive: This cluster of applications is based on high performance hybrids that are less sensitive to cost and require power to augment performance. Fuel cell applications where power density is needed to supplement the fuel cell is a market for this type of battery. Material innovations in the anode will be required to hit the power density targets. Lithium titanate oxide batteries have typically been used in bus and motorsport applications to achieve the higher power densities. Ultra-capacitors provide a rival solution to Li-ion batteries in this space. Despite having very low energy densities, their superior power densities have made them attractive solutions for some electric buses in China’s urban areas and to augment the performance of Wrightbus’ fuel cell buses. Further research is being carried out in the medium term to improve power density for Li-ion batteries. New materials e.g. niobium-based anodes are being explored to hit the high-powered applications but require a few more years to scale out of the pilot phase. Several companies looking hybrid ultra-capacitors which approach the energy density of Li-ion and still possess the superior power density. Can be achieved through enhancing the dielectric materials in ultra-capacitors through innovative polymers or graphene.

 

Energy focused, weight and power sensitive: These applications require high energy and power density. Products include high performance automotive BEVs, aerospace, high utilisation light duty vehicles and 44 tonne trucks. Energy and power density requires doubling in 15 years in order to meet the demanding duty cycles and prolonged use. Costs likely to remain stable over the next 10 years as new technologies are commercialised and reach economies of scale. Strategies to achieve elevated energy and power densities involve advancing liquid based Li-ion technologies or commercialising next generation chemistries. Nickel rich cathodes and increasing the level of silicon in graphite-based anodes will provide immediate energy density improvements. The next stage of advanced Li-ion is commercialising high voltage electrolytes and cathodes such as lithium manganese nickel oxide (LMNO) or silicon dominant anodes. To achieve 2030 targets newpromising technologies are needed e.g. lithium metal anodes, solid and semi-solid electrolytes, lithium-sulfur and lithium-air based. These technologies have significant technical and scale-up challenges including a redesign of the battery cell and new manufacturing technologies. Lithium-air batteries have still not exited the lab, despite much effort in improving their stability and performance.

 

Answer question 3

 

Things to Consider When Attracting Battery Investments: The UK has a foundation in pioneering battery research as well as regional manufacturing hubs with both world-leading R&D and high-volume manufacturing. To smoothly make that transition, the UK government needs to consider the following things:

 

Aggregate local demand that is high enough to justify a Gigafactory investment. In Germany, France, and Eastern Europe, Gigafactories (GF) are being built next to automotive customer bases. These facilities have plans to increase production to at least 15GWh which represents the break-even point for most high-volume cell manufacturers. This equates to ~300,000 vehicles, assuming each vehicle has a 50kWh battery pack. For a 15GWh factory to land in the UK, Nissan or JLR would need to fully commit their entire UK production facilities to full BEVs immediately. Alternatively, numerous vehicle manufacturers could pool their short-term demand to justify the initial investment. Both strategies require ambitious planning and co-ordination on behalf of UK vehicle manufacturers. The UK has three companies that have indicated a willingness to manufacture battery cells. They are Envision-AESC, AMTE Power (Formerly AGM Batteries) and Britishvolt.

 

Building a UK battery chemical supply chain to capture the economic value. The most important sub-components that make up battery cells are the anode, cathode, electrolyte, separator, and current collectors. The true value creation lies in the highly processed materials that make up these five sub-components. Importing all five components in from Europe for UK GF would be a missed opportunity. The UK desperately needs to secure the manufacturing of cathode (and ideally anode production) in the UK. The supply chain model currently being pursued is localising battery chemicals close to GF. In Finland for example, nickel miner Nornickel and cathode manufacturer BASF are co-located to improve the quality of their product. But they are not far from Northvolt in Sweden and many other planned GF in Germany and Poland. For the UK to compete with other European countries for cell manufacture, we must nurture our strong chemical sector and enable them to refine and process battery materials. Fortunately, we are not starting from a poor position in this respect. In the UK we have: Vale, Johnson Matthey, Mitsubishi Chemicals, Phillips 66, Talga Technologies, Livent and Leverton Lithium.

 

Availability of affordable, clean energy at manufacturing sites. Battery cell assembly and battery chemical processing facilities are energy hungry. Access to high voltage and power sources is therefore integral for GF to be viable in the UK. Ideally with green energy, in anticipation of future EU regulation on life cycle CO₂, many vehicle manufacturers are demanding low carbon cells and chemicals from their suppliers. In December 2020, the EU updated the Battery Directive to improve the environmental performance of batteries sold in the EU. It stipulated by 2024, batteries will need a carbon footprint declaration and a minimum recycling threshold for materials such as lithium, cobalt, and nickel in 2030. Plans for attracting battery supply chain investments need synergies with the UK government’s plans to create zero carbon energy clusters for businesses and be connected to the UK’s offshore wind ramp up, especially in places like South Wales, the North East and North West.

 

Answer question 5

 

Competitive Landscape for Batteries: The UK is behind Asian players across battery value chain, as is Europe and North America. China dominate the market with two of the largest players (BYD & CATL) but with many other players like Lishen, S-Volt and Farasis quickly buying up global market share. Given the state rules in China, Japanese companies (Panasonic) and South Korean (LG, Samsung, and SK Innovations) have set up factories in China to gain access to their domestic markets. China dominates key areas in the supply chain, from mining right through to refined materials and assembly. Over the past few years, GF have been springing up across Europe, mainly transplants from Asia in Eastern Europe and Germany. However, several European based cell manufacturers, most notably Northvolt, have emerged to supply the large European OEMs. The EU Commission has launched stimulus packages aimed at building a local battery supply chain. In December 2019, the EU committed €3.2bn to help establish a domestic supply chain across 7 Member States. In January 2021 the EU Commission committed an extra €2.9bn aimed at battery innovation across 12 Member States. The picture is similar in the United States. In the wake of semiconductor shortages and rare earth price scares, Joe Biden has issued an Executive Order into the United States’ position on critical supply chains like batteries, semiconductors, and the rare earth supply chain. While no investments has been announced yet, it’s expected some of the $1.9 trillion stimulus package will be directed into making the US a world leader in sustainable energy.

 

UK Strengths in Batteries Despite the strong lead from the Asian economies and the vast commitments from major economic blocs, the UK has notable strengths:

 

Answer question 8

 

Life Cycle Impacts of Batteries: Based on the APC EES roadmap, the APC can provide a view on the life cycle impacts of batteries.

 

29 March 2021

 

[1] https://about.bnef.com/blog/battery-pack-prices-cited-below-100-kwh-for-the-first-time-in-2020-while-market-average-sits-at-137-kwh/

[2] https://i.emlfiles4.com/cmpdoc/8/5/0/4/3/1/files/93002_20201015-wmg-battery-manufacturing-targets-report.pdf?utm_campaign=1850317_Bulletin%20NOV%202020&utm_medium=email&utm_source=dotdigital&dm_i=2VFU,13NPP,6I81KD,48L3Q,1

[3] https://www.apcuk.co.uk/technology-roadmaps/