It’s rare that very technical demonstrations of technology and supply chain advancements manage to jump beyond industry and into the public consciousness. But as with all things Tesla, the announcement of the company’s Battery Day was met with significant hype beyond just the storage and electric vehicle industries, and with good reason: teasers in anticipation of the event seemed to indicate that Tesla had discovered a breakthrough in energy storage manufacturing that would reduce the price of batteries to the point that they could begin to produce and commercialize a truly affordable electric vehicle.
Now that September 22nd has come and gone, here’s a recap of what you need to know about Tesla’s Battery Day, as well as how (and when) you might start to see these technologies implemented into the storage & electric vehicle industries.
A quick overview of Tesla’s Battery Day announcements
A number of great industry articles have already been written to cover the results and ramifications of Battery Day from an industry perspective, including one from GTM and one from Utility Dive. With that in mind, we’ll try to focus on what it means to consumers of Tesla products and how this technology might impact the rest of the solar + storage and EV industries.
At a high level, the announcements at Battery Day focused on three things: new battery cell design, improved efficiency in manufacturing, and a shift in their supply chain.
The new battery cell design is a more power-dense design, meaning that these batteries have a better power-to-weight ratio than existing technologies. It’s not hard to see how this can be immediately valuable in electric vehicles and energy storage systems: a lighter, more powerful battery means longer range for electric vehicles and easier to install home energy batteries.
Tesla’s battery manufacturing is becoming more cost-effective due both to this new cell design as well as due to process changes. While these changes are rather esoteric (dry electrode coating anyone?), the impact here is much more apparent: a shorter and less energy-intensive manufacturing process is a less expensive one that also improves the existing supply and demand imbalance.
Finally, Tesla announced that they will eliminate cobalt from their lithium-ion batteries. Though on the surface this may seem like another arcane difference in supply chain mechanics and battery chemistry that won’t ultimately impact consumers, there are a couple of key reasons why you should care about this change. For one, cobalt is a rare metal, making the price of cobalt highly variable and unpredictable. Switching away from cobalt should decrease prices and increase the certainty around the price of making batteries moving forward. Importantly, the adverse environmental and human impact of mining for cobalt has increasingly come into focus in the last couple of years: recent journal articles and multiple pieces in widely read publications have put a spotlight on the environmental degradation associated with cobalt mining, as well as the detrimental health impacts the process has on the miners. Reducing the use of cobalt in batteries can create a healthier, more sustainable supply chain for energy storage manufacturing.
Is the technology announced at Battery Day available today?
The short answer? No.
In a break from the hype around previous product announcements (think the first launch of the Tesla Solar Roof tiles for instance), Tesla was quick to point out that these technologies are not yet commercially viable. That said, Tesla outlined a path towards ramping up production of batteries under the new process, design and supply chain improvements that would see them start with a pilot manufacturing facility before ramping up production by 10x by 2022.
All of which is to say, you can expect to see the impact of these announcements implemented in electric vehicles by 2022 at the earliest.
What does Battery Day mean for electric vehicles?
Overall, there’s one big takeaway from Battery Day for electric vehicles: Tesla plans to increase the range of EVs (i.e., the distance they can travel) by more than 50 percent, while at the same time reducing the costs of the battery by more than 50 percent. Combining these two impacts, Tesla aims to produce an electric vehicle for $25,000 in 2022, one of the first instances of a truly affordable electric vehicle.
What does Battery Day mean for the solar + storage industry?
While Battery Day primarily focused on how these improvements in storage manufacturing will impact electric vehicle range and pricing, any technology that starts in EVs will ultimately find its way to home energy storage systems. In fact, two of today’s major energy storage cell manufacturers–Panasonic and LG Chem–got their start in building batteries for use in vehicles.
There’s no easy way to forecast how long it will take for the improvements in battery storage power density, manufacturing efficiency and cost will ultimately find their way to the “stationary” storage systems, like the solar batteries installed in homes. That said, the same battery cells used in vehicles are often used in stationary batteries, so these technological improvements could make their way into your home as early as 2022 (but perhaps more likely by 2025.)
Explore your storage options on EnergySage today
Even before these improvements were announced at Tesla’s Battery Day, solar batteries have become more efficient, more power-dense, and more cost-effective over the last five years. If you’re interested in exploring your options for a solar plus storage system for your home or business, register for a free account on EnergySage today to get custom quotes from local companies.