Energy Secretary Chu: Plug-in Vehicles Will Become Mainstream as Battery Prices Plummet

By Eric Loveday · January 11, 2012

Energy Secretary Steven Chu says that plug-in vehicles will become mainstream as battery prices plummet over the next three to four years.

Speaking at the 2012 Detroit Auto Show, US Energy Secretary Steven Chu stated that plug-in vehicles will become a major force in the automotive industry by 2020. Chu chalks up the rise of electric vehicles to "plummeting" battery prices and claims that the plug-in segment has a "good shot" of hitting Obama's target of one million plug-in vehicles on US roads by 2015.

“Whether it is 2015 or 2016 or whenever, I don't know. I think it is possible. It depends on a lot of things. The price of batteries is plummeting. Three or four years ago, the cost of manufacturing a battery was $1,000-$1,200 a kilowatt hour. It's now about $600 a kilowatt hour. It's going to come down and everyone knows this.”

Steven Chu, US Energy Secretary

Chu reportedly stopped to look at the 2013 Chevrolet Malibu Eco and the 2013 Chevy Spark minicar while passing by the General Motors display at the Detroit Auto Show. But Chu didn't even glance at the Chevy Volt, a vehicle that the Energy Secretary has seen countless times in the past.

Chu closed his remarks by saying that plug-in technology is still in its infancy, and buyers are slowly warming up to it. "The plug-in hybrids will become mainstream, followed by the all-electric vehicles," said Chu.

About the author

· Eric Loveday

Eric Loveday is an automotive enthusiast who is passionate about everything auto. He purchased a 1970 Chevelle at age 16, quickly outgrew its dated engineering and outrageous consumption of gasoline, and sold it off. Eric developed a true passion for automotive writing after graduating from the University of Michigan with a degree in print journalism. Eric spent most of his time since then ...

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Comments

· indyflick · 18 weeks ago

I just wish the DoE would have handled the EV Project differently. They should have awarded multiple contracts to create a "land grab" atmosphere and get the public EVSE deployments done quicker. Also, they should have selected vendors who had actual experience in deploying EV charging infrastructures. Had that happened in 2009, things would be very different today.

· Laurent J. Masson · 18 weeks ago

"Plumeting" battery prices? I'm not so optimistic. But it'll be an important step when the price of a battery drops below $10K. That should happen soon.

· jim1961 (not verified) · 18 weeks ago

I think it speaks volumes about Obama that he chose a Nobel prize-winning physicist to be energy secretary. The following link is off the subject but I think many of you will find it interesting. www.earthtechling.com/2012/01/obama-drives-clean-energy-boom-on-public-l...

· Londo Bell (not verified) · 18 weeks ago

"I think it speaks volumes about Obama"

Not sure why you have to bring politics into this one...but I actually think of the opposite, due to Obama's handling of the Gulf oil spill (and the quick turnaround on allowing deep sea drilling again), and the Keystone pipeline, and the acceptance of "lowering" mpg on CAFE due to pressure from automakers...

· Charles (not verified) · 18 weeks ago

Just a quick question to Londo Bell, Obama has an EPA of 40 MPG as the CAFE standard, what would it be if the GOP was in office?

Obama is not doing what I want, but he is coming light years closer than the GOP would.

· Londo Bell (not verified) · 18 weeks ago

@ Charles,

1. That's the exact reason why I said, "not sure why...bring politics"
2. I didn't use any comparison with the GOP, or "wish it's the GOP in the office right now," did I? Don't put words in my mouth.

· EVNow · 18 weeks ago

"Three or four years ago, the cost of manufacturing a battery was $1,000-$1,200 a kilowatt hour. It's now about $600 a kilowatt hour."

This supports my claim that battery price halves in 5 years.

· ex-EV1 driver · 18 weeks ago

@EVNow,
I think that halving every 5 years may be a bit aggressive.
The "Moore's law" for batteries that I'm familiar observes that it is about 10% per year over the past several decades. While this is a lot slower than "Moore's Law" for semiconductors, it is still a fast improvement rate.
For those not familiar with "Moore's Law" see http://en.wikipedia.org/wiki/Moore%27s_law.
For batteries, it means we see about 10% improvement in energy capacity per year. This can be translated to 10% more energy in the same weight and cost or 10% less weight and cost for the same amount of energy. Either way, it means we're improving rapidly if the industry can keep up the trend.
For fun, here's how this would affect the EV1's 120 mile range battery if it had started out at $30,000 in 1999 when it was made:
1999 $30,000
2000 $27,000
2001 $24,300
2002 $21,870
2003 $19,683
2004 $17,715
2005 $15,943
2006 $14,349
2007 $12,914
2008 $11,623
2009 $10,460
2010 $9,414
2011 $8,473
2012 $7,626 <-- justification for the $7,500 tax subsidy today?
2013 $6,863
2014 $6,177
2015 $5,559
2016 $5,003
2017 $4,503
2018 $4,053
2019 $3,647
2020 $3,283
* I can't find the original source that I used back in the early '00's for cellphone capability projections. There seems to be a huge amount of FUD out there today stating dumb reasons why there isn't a "Moore's Law" for batteries, clearly batteries have improved that shows a total lack on acknowledgement of history. http://www.raytheon.com/technology_today/2011_i1/battery.html shows a historical trend of battery energy capacity (wh/kg) over the past several decades and, if you skip the 2 extremes and start around 1960 you get about 10% per year, just with major chemistry breakthroughs.

· EVNow · 18 weeks ago

@ex-EV1 driver · "The "Moore's law" for batteries that I'm familiar observes that it is about 10% per year over the past several decades."

Hmmm ... I just quoted what Chu said and he said it has come down by 40% to 50% in 3 or 4 years. Instead you want to go by 10% ? Ok, I'll play along.

There has been orders of magnitude more investment into battery research now than in the past decades. Won't it push from 10% to say, 13% ?

Why 13% ? Because, that is all it takes to halve the price in 5 years.

· indyflick · 18 weeks ago

Battery innovation seems to take leaps and then improve very slowly for a period of time. I don't believe a 40% to 50% improvement is sustainable over a long period of time. Over a long period 7% to 10% is the normal.

· priusmaniac (not verified) · 18 weeks ago

@EVNow
I can understand your desire of optimism to make a 10% into a 13% but even if it was only 7% this is still fantastic because there is no turning back. Once you have improved a battery you can only stand still or improve it further. These 7, 10 or 13 % are not like % of economic growth because there is no recession possible. You cannot undiscover a technology.

· JRP3 · 18 weeks ago

Just because something progresses does not mean it's "Moore's Law", which specifically states that the density of transistors on a chip will double approximately every 18 months. There is no Moore's Law for batteries, there is a steady stream of optimizations with some likely jumps thrown in once in a while.
http://ephase.blogspot.com/2011/11/moores-law-for-batteries-dont-count-o...

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Energy Secretary Chu: Plug-in Vehicles Will Become Mainstream as Battery Prices Plummet

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