Despite the fact that battery costs have been dropping since 2010, a recent spike in the price of key battery metals like lithium has cast doubt on their future. So, here we break down the cost of an EV battery cell.
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The global supply of electric vehicles (EVs) and demand for their batteries is increasing as battery costs continue to fall.
Since 2010, the average cost of a lithium-ion (Li-ion) EV battery pack has dropped from $1,200 per kilowatt-hour (kWh) to just $132/kWh in 2021, according to Govind Bhutada of Visual Capitalist.
Multiple interconnected modules made up of up to hundreds of rechargeable Li-ion cells are found within each EV battery pack. These cells account for around 77 percent of the entire cost of a typical battery pack, or about $101/kWh.
So, what factors influence the price of individual battery cells?
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The Cost of a Battery Cell
The price of each cell’s cathode accounts for more than 50% of the whole unit cost, according to BloombergNEF figures.
Why Are Cathodes so Expensive?
The cathode is the battery’s positively charged electrode. Whenever a battery is discharged, electrons and positively charged molecules (the lithium ions) travel from the anode to the cathode, which retains both till the battery is re-charged.
That implies cathodes are one of the most crucial components because they control the performance, range, and thermal safety of a battery, and thus of an EV.
Depending on the cell chemistry, they are made up of several metals (in refined versions), including lithium and nickel. The following are examples of modern cathode compositions:
- Lithium iron phosphate (LFP)
- Lithium nickel manganese cobalt (NMC)
- Lithium nickel cobalt aluminum oxide (NCA)
Battery metals, which constitute the cathode, are in great demand, with automakers like Tesla scrambling to procure supplies as EV sales soar. Indeed, the cathode’s commodities, along with those in other portions of the cell, contribute for around 40% of the total cell cost.
Other EV Battery Cell Components
The remaining 49% of a cell’s cost is made up of non-cathode components.
The production process, which includes making the electrodes, putting the components together, and completing the cell, accounts for 24% of the entire cost.
Another important part of the battery is the anode, which accounts for 12% of the total cost—roughly one-fourth of the cathode’s portion. A Li-ion cell’s anode is usually made out of natural or synthetic graphite, that is less costly than other battery materials.
Despite the fact that battery costs have been dropping since 2010, a recent spike in the price of key battery metals like as lithium has cast doubt on their future. How will the cost of electric vehicle batteries change in the future?