Battery costs will fall to $250/kilowatt hour by 2015

Our most burning question – aside from how many licks it takes to get to the center of at Tootsie Pop – is, how much does a battery-electric vehicle's battery really cost? One analyst says that the price tag will be at about $250 per kilowatt hour by 2015, which spells good news for the EV industry.

Roland Berger Strategy Consultants' analyst Wolfgang Bernhart told EV Update that the cost of a typical plug-in hybrid-electric battery "in Japan and Korea for contracts with a 2015 delivery" will be at about $250 per kilowatt hour. Raw materials account for almost 60 percent of the costs while labor, utilities and depreciation take up about a third.

The estimate follows up Roland Berger's analysis last month that said there would be "massive overcapacity" of lithium-ion battery packs by 2015 with supply running about twice the expected demand and driving prices down to less than 200 euros ($253 U.S. at today's exchange rate) per kilowatt hour by that year. About three-quarters of the global market will be controlled by AESC, LG Chem, Panasonic/Sanyo, A123 Systems and SB LiMotive.

Automotive analysts are watching battery costs closely because batteries typically account for more than a quarter of the cost of a plug-in vehicle. In April, Bloomberg New Energy Finance estimated battery costs at $689 per kilowatt hour, down from $800 a year earlier. Other estimates for where the prices go from here include $400 per kWh by 2020 and less than $200 per kWh by "soon." We'll let you know which one is right in eight years.



Source: Autoblog Green