Lithium-ion technologies are the most widely used electrochemical energy storage technology today. Last year, it received the bulk of industry’s applied research essentially focused on driving incremental improvements. Venture capital, on the other hand, invested over a half billion dollars into exploring solutions which addressed lithium-ion’s challenges through new chemistries or new technology paths to solve our global energy storage problem. Over the last few months, we have received inquiries on the market progress of those portfolio companies. Through these conversations, we noted an inconsistent understanding of battery technologies and the challenges that the industry faces.
To address this, Cypress River Advisors sat down with William Chueh, a leading material science and engineering researcher at Stanford University and his team of Ph.D.’s who are tackling the question: "How to build a better battery?” While there are many different kinds of energy storage systems, the rise of mobile devices has made lithium-ion the incumbent technology today for consumer electronics and electric vehicles. It serves as one of the major benchmarks for which all battery technologies are compared to today. We hope that this article and its related videos will give industry observers an initial overall sense of the challenges ahead with different technologies.
The ideal battery
Batteries have been around since the time of Benjamin Franklin. A smartphone battery now packs more power than the single use electrochemical cells that were once the size of milk jugs). Today, batteries are essential to our modern lifestyles. They power our phones, cars and even homes.
An electrochemical battery is fairly simple in construction. It is composed of a cathode (positive end), an anode (negative end), an electrolyte that serves as a medium to conduct ions and a separator which isolates the electrodes but allows the movement of ions. But what are the characteristics of an ideal battery?
High capacity and stable energy output over a long run time
High power to run power tools or an electric vehicle motor in the smallest and lightest form factor possible
Fast and consistent recharging times
Long life and durability
Safe usage under wide operating conditions with respect to temperature and humidity
Low toxicity during manufacturing and at end of life
Affordable source materials and manufacturing process
Unfortunately, no single chemistry delivers all the above desired characteristics simultaneously. The lead-acid battery in your car is impractical for mobile phones but practical to be the starter for your Mustang because it can survive a wide range of temperatures, also lead-acid batteries are the ubiquitous cheap incumbent. Other chemistries, like the vanadium flow battery, is perfect for grid applications because it can store power over a long period of time. But its strength is also its weakness, to store large amounts of stable power, you also need tanks the size of a car. What about the batteries that power our smartphones, tablets and our electric vehicles? (Click herefor a recent history of the rechargeable battery.) Lithium-ion (Li-ion) batteries are relatively lightweight, can be recharged thousands of times to power your phone perfect for mobile applications, but when damaged can result in fires. At the end of the day, batteries are optimized to the applications.
Today’s industry focus: lithium-ion. But are there other options?
The bulk of today’s commercial research is largely focused on lithium-ion technologies. It is important to note, there are several variants of Li-ion technology. As we mentioned above, there are many energy storage options available. Several different types of energy storage technology are receiving venture capital attention, i.e. flow batteries, silicon cathodes, sodium sulfide, advanced lead acid, liquid metal batteries and so on. Battery innovators not only developing new chemistries but also the material structure of the different parts of the battery.
If lithium-ion so popular, why are venture capitalists interested in new battery types? There are several reasons. The incorporation of renewables into the grid requires a new generation of scalable long-duration batteries to capture surplus power produced during peak periods. Batteries will be key to enabling grid integration and enabling the time shifting of electricity delivery, eliminating the need for inefficient and polluting peaker plants. Also given the recent incidents of lithium-ion batteries in consumer devices (and aircraft), the industry has a significant incentive to explore safer chemistries and battery structures. In a separate article, we will discuss the differences in approach these startups are taking. From the point-of-view of Cypress River Advisors, these are key drivers creating disruption in the battery industry long mired in incremental improvements for decades.
The challenges in the chemistry
What are the challenges in battery chemistry? Ideally, you want a battery that has high coulombic efficiency, in plain English: all the charge put into a battery comes out (subject to resistive losses). You also want stable power output that performs well over a wide range of operating conditions (temperature and humidity). You also want a rechargeable battery that you can cycle over and over. Each new chemistry has its own limitations, the chemistry also informs the kind of packaging and safety requirements for safe operation. All these factors are interrelated and inter-dependent. Needless to say, these are challenging research problems. Let us examine at a few of the technical challenges the industry needs to solve.
Energy and Power Density
Energy density is the amount of energy stored in a battery. Increasing the energy density means you get more energy for a given battery size. For example, an electric vehicle can travel farther without increasing the weight. Higher energy density is particularly critical for connected devices where the size of the battery is constrained by the consumer demand for sleeker and thinner designs.
If you increase the battery’s energy density — less of those are needed for a given amount of energy when you can increase the energy density of the battery. So, increasing the energy density of the battery is one of the best ways to decrease cost. The most expensive components of a lithium-ion battery now come from the non-active materials—the current collectors, separators. If you increase the battery’s energy density — less of those are needed for a given amount of energy when you can increase the energy density of the battery. Take the cathode, for example, both consumer devices (lithium-cobalt oxide) and larger devices like a Tesla electric vehicle (nickel-cobalt-aluminum) use: cobalt. In 2016, cobalt per pound was $10.88 USD. At the time of writing this article, the price of cobalt has nearly doubled having around $25 USD per pound. This is all before processing and manufacturing.
That being said, researchers at UC Berkeley and Carnegie Mellon note that costs of lithium-ion batteries continue to decline, despite volatile cobalt and lithium prices. The diversity of material constituents in emerging battery technologies appears to serve as a buffer to material price shocks. Efficient assembly of battery cells and packs and technological learning may be driving costs even lower. It is possible large battery companies like LG and Panasonic cross-subsidize their battery research and development, yet the extent of cross-subsidization remains uncertain. Policy incentives in China to accelerate electric vehicle growth drive demand and subsidize manufacturing costs. The level of subsidies in China and cross-subsidization between companies remains an area of uncertainty leaving the possibility that true costs are not reflected. All things considered, when building a better battery, improving technology performance through energy density can deliver better returns than addressing dynamic lithium or cobalt prices alone.
There is a drawback when increasing energy density. Almost always, as you increase energy density the battery lifetime goes down. On a cell level, increasing the energy density means higher active material fractions. This means that the other components of the cell that help the battery to function, such as the binder and conductive additives, is decreased. On a materials level, increasing the energy density often means squeezing out more reactivity from materials, which pushes them to conditions that are less stable. If you want a rechargeable battery, you need reversibility and stability. So, as you can see there are some serious trade-offs that a battery designer needs to be balanced.
One promising area of research is over-lithiated metal oxide batteries. Here researchers are trying to solve the voltage fade issue. Another chemistry being explored is lithium-sulfur batteries, however, the “polysulfide shuttle problem” (need link) can cause self-discharge, low charging efficiencies, and irreversible capacity losses. Needless to say, battery chemistry is complex, not just for the main reaction but also side reactions. Each new chemistry has a whole host of other issues to address which we will discuss in the next section.
Side Reactions
What are side-reactions? These are secondary chemical reactions that occur at the same time as the main reaction that produces electricity. Batteries perform differently under different application and operating conditions. In hot environments, lithium-ion batteries in EVs need to be properly cooled. Otherwise, battery life and driving range are irreversibly affected. In these batteries, unwanted side reactions degrade the battery performance. The graphite anode becomes plated with a non-reactive film of solid electrolyte interphase (SEI) which negatively impacts long-term battery performance. While the graphite beneath can still charge/discharge, the SEI creates more resistance to this process, which decreases battery performance. Furthermore, the lithium that is trapped in the SEI decreases the available lithium for the battery, decreasing battery capacity.The science underlying the how the type of graphite, electrolyte composition, chemical conditions affects the formation and growth of films is still not well understood.
Gas Evolution
Side reactions can also result in gas building up in a battery packaging. Hydrogen gas can build up) when the battery is overheated, overcharged or drained of charge for too long. These gasses can react explosively with a flammable electrolyte. Even during the normal course of a battery being charged and discharged, the movement of ions also can result in electrolyte breakdown, building up carbon dioxide gas inside the battery. Overcharging can damage the separator, leading to sudden discharge. It is important to note that subtle defects during the manufacturing process may be exacerbated. Over time, as pressure builds up, the structural integrity of the battery package is compromised. Pouch cells are especially vulnerable since they do not have hard structural elements.
Structural Changes
As a battery cycle through charge and discharge, the particles in the battery can break apart due to the stresses. If a particle fractures, then it could become disconnected from the current collectors, which are usually a carbon additives. If that happens, these particles become disconnected from the battery resulting in lost capacity.
A number of companies are experimenting with nanotechnology to build electrodes that exhibit better mechanical compliance. There is, of course, a downside. The higher surface available for reactions also means parasitic reactions are also more likely. With respect to packing, how much nanomaterial you pack into a given space also has an impact on performance.
Dendrites & Lithium Plating
In a Li-on battery, lithium ions are intercalated, i.e. inserted, in a metal oxide lattice. The intercalation and de-intercalation process, the movement of ions during charging and draining, can cause the battery package to expand and contract as we previously discussed. This is undesirable because it can lead to compromises in the packaging. More importantly, lithium may also not properly go back into its lattice but instead form dendrites. If a cell charges too quickly, these dendrites get bigger and may pierce the separator leading to a short circuit. As we mentioned earlier, lithium may also plate the graphite anode instead of properly suspend itself back in the lattice.
Safety
All these above factors also impact the safety of batteries. Batteries work by combining of simultaneous electrochemical reactions and physical safety measures. They have to work together to deliver: high energy density in a safe rechargeable package. The flammability of the organic electrolyte is always a concern in the consumer and transportation markets. It’s a major reason why many groups are investigating solid state batteries. Solid state batteries replace the organic solvent with a solid electrolyte, eliminating the risk of significant heat or gas buildup. Again, this approach is not without its challenges, now the lithium must be transported through a solid and the electrical resistance is a tough problem to solve. On top of this, researchers need to figure out how to create a cost-effective deposition/synthesis methods.
You could comment on the difficulties of solid state batteries. Now the Li must be transported through solid phases, rather than the liquid electrolyte, and the resistance from transport is a tough problem. Furthermore, cost-effective deposition/synthesis is another issue.
The challenges in performing research
As we alluded to earlier, even the particle size of the components can impact the battery performance. By now, you can see the interplay of physics and chemistry is complicated. Batteries are an assemblage of composite materials. Both anode and cathode are porous composite materials (containing active material, binder, and conductive additives). Component materials may be contaminated during the manufacturing process leading to unexpected side reactions. Particle size and shape can also add to the variability. Furthermore, the reactions in the battery do not occur uniformly throughout the electrodes. In the SEI example from above, the passivating layer is extremely fragile. It is formed in situduring the first charge and discharge cycle. But if you try to open the battery and perform tests, it changes or falls apart. That makes it that much more difficult for a researcher to identify a solution.
So how can you observe the changes in a battery in situ? Will Chueh’s material sciences group at Stanford have gone so far as to use synchrotron-based x-ray techniques at Stanford SLAC and Berkeley National Labs Advanced Light Source to observe these changes to nanoparticles in battery components. As you can imagine, obtaining access to X-ray microscopes and performing these experiments is not easy. Only a few academic groups and large corporations have the ability to conduct these types of tests.
Another challenging aspect of research is simulating long cycle times. For example, your smartphone battery is expected to last several years which is equivalent to at best a thousand cycles. To make sure a new type of battery will perform to specification is time-consuming, to say the least. So companies and researchers use specialized test equipment to simulate various conditions found around the world. To hasten the test process, they test banks of batteries at elevated temperatures and compare that against room temperature control. Even compared with normal cycling, running accelerated tests are still time-consuming. Simulating real performance under a variety of heat and moisture stressors also remains a serious challenge for batteries used in vehicles or for grid-scale applications.
The reality of the energy business
Building a better battery takes more than assembling different chemistries and reading out the voltages. A wide range of factors impacts a battery’s performance and lifetime. Researchers need a way to understand the reactivity at different specific places in the battery. If you want to understand what is fundamentally happening to the materials in the battery, you need more sophisticated tests to drive the science forward.
Moreover, the reality of the energy business is dependent on one thing: cost. As Professor Chueh notes, “What battery technologies we use for a given application will depend on the cost structure of the specific technology produced, stored and utilized.” It doesn’t matter whether the power source is renewable or not, the challenge scientist face is to develop technologies that are competitive in the market