TeslaPackCostsDisruptiveOrClose-Vindicates 18650 choice?

[MitchJi]

Hi,


When the Powerpack prices of $250 per kWh were announced I thought we could use those prices to reach several conclusions:

1. Their Powerpack prices of $250 per kWh are below deeply disruptive and this market is huge:
Why Energy Storage is About to Get Big and Cheap | Ramez Naam
http://rameznaam.com/2015/04/14/energy-storage-about-to-get-big-and-cheap/

2. We can use the Powerpack price to get a much better idea of their car pack costs than were possible before.

3. Their prices are lower than anyone knows, and Tesla has been, and continues to hide them.

4. When you factor in the GF cost reductions at about the end of 2016 or mid 2017 their prices will be at least close to being disruptive, and definitely low enough that producing and affordable M3 is going to be a slam dunk.

Based on the following a reasonable post GF estimate (mid to late 2017) that Tesla could sell their packs for is ($180 x 70% = $126 per kWh):

Jaffe said that Panasonic is selling Tesla Powerpacks at a rate of $180 per kWh.

Tesla Motors Inc (TSLA) Drives Battery Costs Lower Than Most Optimistic Forecasts
http://learnbonds.com/120435/tesla-...y-costs-lower-than-most-optimistic-forecasts/

Two years ago Tesla Motors (NASDAQ:TSLA) said that it had already beaten the $250/kWh mark. CTO JB Straubel said, in an interview with Technology Review, that battery costs were “way less than half, actually, less than a quarter in most cases.” That puts the estimated cost of the cells in a Tesla Motors 85kWh Model S at just under $240.

That piece was published back in 2013, long before the Gigafactory began its testing phase. It’s was also before Tesla Motors got in touch with key Li-ion expert Jeff Dahn and made a deal to lower the unit cost of batteries in its EVs...

It’s likely that Tesla Motors battery costs are below $200 per kWh right now, but the firm doesn’t reveal that closely guarded secret too easily. Power cells are the area in which the firm is way ahead of other EV makers. It wants to We're all kind of saying the same things. The Model X is already known. Mr. Market also has factored in that there is demand for the product, although the lingering question of whether the demand is niche or not dances in some people's minds (not mine). The delivery of a few X's that success to itself for the time being.

Navigant Research’s Sam Jaffe is certain that Tesla Motors is below that level, and he reckons the firm has been below it for quite a while. In an October 2014 UBS report on EVs, which focused on battery costs, Jaffe said that Panasonic is selling Tesla power packs at a rate of $180 per kWh...

Tesla Motors (NASDAQ:TSLA) has never offered the clearest view on its inner workings in its earnings reports, despite the transparent measures the firm has taken in other areas. It’s not really clear how much the firm is paying per kWh of power in a Li-Ion pack, but it’s likely that its costs are lower than other players in the market.

All of this is guesswork, but some of it is more informed than others. It’s unlikely that Tesla Motors is still stuck above the $250 kWh level for batteries, and it’s likely that the firm has gotten those costs down to below $200.

One example of close to being disruptive is that with a 30% reduction in costs Tesla could sell the new 90 kWh pack in a 120 kWh version for the same price. That is a 400 mile range! I realize it might take a 2-3 years to increase the energy density to the point where that's practical, but they are getting close! I'm not sure where the "tipping point" is but I am positive that a 400 mile range makes the cut! Gas powered cars are on the way out, and Tesla is leading the way!

 

[MitchJi]

Hi,

The quotes below are from the 2015 Q1 Earnings Call Transcript:

http://seekingalpha.com/article/220...k-on-q1-2014-results-earnings-call-transcript

Elon Musk (Chairman and CEO):
There are two applications which are quite different. One is backup power, or peak-up -- the equivalent, on a utility scale of like a peaker plant, which is a high-energy application. And there is the daily cycler application. There are different chemistries, depending upon what you have.

The backup power chemistry is quite similar to the car, which is a nickel cobalt aluminum or a cathode. The daily cycling control constituent is nickel manganese cobalt. It's quite a lot of manganese in there.

One is meant for, call it maybe 60 or 70 cycles per year. And the other one is meant for daily cycling -- daily deep cycling, so it's 365 cycles a year.

The daily cycler one, we expected to be able to daily cycle for something on the order of 15 years. Obviously warranty period would be a little bit less than that. We expected to be something that's in the 5000-cycle range capability.

Whereas the high-energy pack is more like around the maybe, depending on how it's used, anywhere from 1000 to 1500 cycles. They have comparable calendar lives.

Now for the high-energy one, it's important to appreciate that this is actually -- has a lot of interest from utilities because utilities have to maintain these things called peaker plants, and when there is a sharp increase in usage. You can imagine the highest energy day in California on a hot summer day where there's a heat wave, the energy consumption there is very high compared to a pleasant spring night where nobody's air-conditioning or heating is on, or for very little and commerce is not happening and people are asleep and lights are off....

The high-energy pack is actually very economically competitive in those sorts of situations. The high cycling pack is really great for if you've got some sort of wind or solar situation, that's where the high cycling one is really great on the utility scale.

Comments:
I am surprised that the car packs are very similar to their low cycle count packs.

I didn't notice that utilities would have an interest in the low cycle count packs.

And that is just the beginning:
http://cleantechnica.com/2015/07/22...-years-tesla-motors-cto-jb-straubel-contends/

I think we’re at the beginning of a new cost-decline curve, and, you know, this is something where there’s a lot of similarities to what happened with photovoltaics. Almost no one [would have predicted] that photovoltaic prices would have dropped as fast as they have, and storage is right at the cliff, heading down that price curve. It’s soon going to be cheaper to drive a car on electricity — a pure EV on electricity — than it is to drive a gasoline car. And as soon as we see that kind of shift in the actual cost of operation in a car that you can actually use for your daily driver, you know, from all manufacturers I believe we’re going to see electric vehicles come to dominate the whole transportation fleet."


"Also, that same battery cost decrease is going to drive batteries in the grid. There’s going to be much faster growth of grid energy storage than I think most people expected. You suddenly get to have energy that’s 100% firm and buffered from photovoltaics that’s cheaper than fossil energy. And we’re within sort of grasping distance of that goal, which is very, very exciting.

 

[rsilvers]

Is that $180 for 18650 cells, or complete packs?

If it is cells, and each cell is 3Ah, then that is $1.94 per cell. If it is for complete packs, then the cells are even lower than that.

 

[100volts+]

Musk is gonna finish building that muti-billion dollar lithium battery plant when some revolutionary battery technology a hundred fold better is invented out of nowhere seemingly overnight.

 

[Hillhater]

A Year or more ago, I read a industry review that stated quality ,brand name, 18650 cells ( not Panasonic/Tesla, but laptop spec) , were trading wholesale for as little a $1 cell.
The chemistry may be different, but with time and volume production & volume purchasing, prices will continue to fall for the high power "Tesla" type cell which must be getting towards that cost base .
I agree that assembled "pack" costs will be much higher due to the facilities and investment needed for assembly.
Retail costs will also be much higher than these "factory" level costs also.

 

[MitchJi]

Hi,

Mix and match new and old cells. If they will sell the enclosures, by 2017 or 2018 we will probably be able to easily get good deals on packs from wrecked M3's. At that point assembling our own 100 kwh Powerpacks would be pretty affordable.

 

[liveforphysics]

Musk is gonna finish building that muti-billion dollar lithium battery plant when some revolutionary battery technology a hundred fold better is invented out of nowhere seemingly overnight.

+1

 

[MitchJi]

Musk is gonna finish building that muti-billion dollar lithium battery plant when some revolutionary battery technology a hundred fold better is invented out of nowhere seemingly overnight.

Analysts frequently have access to confidential information:
http://blogs.barrons.com/stockstowa...e-gigafactory-will-make-or-break-the-model-3/

Our analysis details a potential path to a 30% cell-level cost reduction to ~$88/kWh by using a more efficient lithium-rich nickel cobalt manganese cathode (vs. NCA), doubling the percentage of silicon in the synthetic graphene anode, replacing the liquid electrolyte with an ionic gel electrolyte which eliminates the need for a separator, and using a water-based electrode solvent for the cathode. The Gigafactory, which is expected to begin production in early ’16, should drive down pack-level costs by 70% to ~$38/kWh via economies of scale, supply chain optimization, increased automation, and production domestication.

Your post triggered the following question in my mind, if Tesla has access to better battery technology why would they wait for the Gigafactory launch to deploy it?

The most obvious reason is that the improved technology is not ready . But it could also make sense to wait, if the improved technology required different production equipment or a substantially different production process.

Does the new 20700 cell format support that idea? Is it possible or likely that the reason for the larger cells is that they are more compatible with an improved type of cell?

Do you think (mainly Luke) that Tesla is going to roll out some big improvements in battery cell technology when they launch the Gigafactory in April 2016, or are the analysts just blowing hot air?

 

[Hillhater]

The 20700 (??) cell size by itself would reduce cell count by 33% for any given pack size, together with proportional reductions in size and weight of related components.
If, by 2017, Tesla can achieve a ~ 20% increase in energy density over the current cell chemistry they use .( up from 240Whr/kg to ~ 290Whr/kg ?)
..AND also use the larger 21700 format cell ,..
they will effectively have a ~ 20Whr, cell, which will dramatically reduce the cell count needed for any given pack size ( -70+% )
That would automatically reduce pack components, assembly costs, together with pack weight and size ( or allow bigger packs !)
really that is using all existing tech ( chemistry equivalent of a 3.7Ahr 18650 cell ?), that would just need to be tested and productionised.
Now, if they have an even better new chemistry, and/or lower cost material /processes,...then yes, there could be further major savings on pack costs.

Note:.. a 22700 cell format has also been mentioned in Tesla presentations , so i am still not certain what we can expect the GF to end up producing ?
https://endless-sphere.com/forums/viewtopic.php?f=14&t=62859&hilit=22700

 

[Hillhater]

Is that $180 for 18650 cells, or complete packs?.

http://reneweconomy.com.au/2014/battery-storage-costs-plunge-below100kwh-19365

Navigant estimates the cost of materials going into a battery at the Tesla Gigafactory on a processed chemical basis (not the raw ore) is $69/kWh

The cost of the battery is only ~10-20% higher than the bill of materials – suggesting a potential long-term competitive price for Lithium Ion batteries could approach ~$100 per kWh.
Tesla currently pays Panasonic $180/kW for their batteries,

They were referring to bare cell cost, (2014 ) with Tesla adding another ~$40 /kWhr in pack components and assembly costs.
So 2014 "assembled pack" cost was approx $220 per kWhr