ABB’s latest investment points to a bright future for lithium-ion batteries
Having played a key role in the shift to electric mobility with its fast-chargers, ABB is now helping to expand the production of lithium-ion batteries
ABB’s recent announcement that it will help fund and equip Northvolt in building Europe’s largest and most advanced factory for lithium-ion batteries in Sweden is nothing if not timely. While there are a number of competing technologies on the market, lithium-ion batteries have emerged in recent years as the frontrunner for battery energy storage because they offer an effective combination of high energy density, low self-discharge, good durability and a limited memory effect.
While they are still relatively expensive compared to the familiar lead-acid batteries used to power the starters in vehicles with internal combustion engines, the price of lithium-ion batteries has been falling even as they have become lighter and more powerful. Based on these impressive advances, the International Energy Agency, in its “Tracking Clean Energy Progress 2017” report, has said: “Lithium-ion batteries are positioned as the main storage technology due to cost reductions and rapid scale-up of manufacturing capacities.”
In 2016, global annual production of lithium-ion batteries amounted to battery capacity of about 70 gigawatt hours, or roughly enough to power every home in the United States for 23 minutes. Based on announced capacity expansions, analysts have estimated that this rate of production will at least triple by 2020.
The largest market for lithium-ion batteries is still the consumer electronics industry. But as demand for electric vehicles expands and carmakers respond by ramping up production, the automobile industry is expected to become the largest market for these batteries, possibly as soon as 2018.
As a growing number of countries – including China, Norway, the UK and France – have announced they will entirely phase out fossil-fuel-powered cars over the next two decades, the long-term demand picture for lithium-ion batteries looks overwhelmingly positive. Demand is also growing from utilities – a field in which these batteries already account for roughly 90 percent of industrial-scale stationary energy storage capacity.
Batteries have a long history: the earliest electrochemical batteries date back to 1800, when Alessandro Volta experimented with stacked plates of copper and zinc. By 1837, better designs played a vital role in the development of the new telegraph lines that began to connect distant cities. But the latest investments in lithium-ion batteries production dwarf everything that has gone before.
While no one can be certain exactly what the state of the art in battery technology will look like 10 years from now, everyone expects the sector to be vibrant, healthy, competitive, and much, much larger than it is today. ABB is well-positioned to play a growing part as a key supplier to this vital and expanding industry.