Winfried Hoffmann: Stored Electricity As Low As $0.06/kWh By 2030

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You can expect to see the cost of storing electricity via lithium-ion battery cell systems fall drastically by the year 2030, according to the relatively well known figure Winfried Hoffmann.

Hoffman — best known for his rather accurate projection of the solar module pricing curve of recent times — predicts quite bluntly that battery storage costs will fall considerably faster that most experts are currently projecting.

“Experts in their own field are often unable to imagine how fast prices can fall,” Hoffmann, an analyst at the consulting firm ASE, stated in an interview with pv magazine.

Why take Hoffman’s word? The most compelling reason to do so would simply be that he was amongst the first analyze the solar module field and make accurate predictions about the nature of the curve that it was/is on. That’s not to say that these new predications are accurate, but certainly it seems that they are worth consideration.

The new predictions about the cost trend of lithium-ion battery cells — using the same method as that used for solar modules — were outlined in detail at a presentation during the recent EU PVSEC meeting in Amsterdam.

 

Hoffman is expecting lithium-ion batteries (for EVs+electronics) to “break the sound-barrier” of $100 per kWh capacity at right around the same time as batteries with a cumulative capacity of 1 tWh are installed.

So, the next question then, is when is that?

Currently, the cumulative volume for electric car batteries is approximately 7 GWh. With an average annual growth rate of 31%, the cumulative capacity of one tWh will be achieved by 2030. Hoffmann considers this rate to be realistic based on the fact that the cumulative capacity in the solar industry increased on average by 41% between 2000 and 2010. “$100/kWh of storage capacity is therefore possible by 2030,” he says. It can be assumed that prices would fall on average by 7% per year.

This learning curve applies only to cells. They only become batteries when surrounded by the so-called packaging. If a Lithium-ion car battery cost $520/kWh capacity in 2012, approximately one-third went towards packaging; the rest, about $180, was spent on the production of the cells. By 2020, these packaging costs will, according to an estimate by analysts avicenne, fall to $50, and Hoffmann expects them to fall even further by 2030 by a factor of two.

If the battery has 80% usable capacity and holds 5,000 cycles, the cost of stored electricity in this evaluation will fall from €0.20/kWh ($0.25) in 2012 to €0.05/kWh ($0.06) in 2030. Should the solar power generation costs fall to €0.05-€0.10/kWh, electricity costs that are more than competitive with the cost of household electricity will result. The cost of this decentralized supply is, according to Hoffmann, notwithstanding transference costs, and will arrive at below the cost of electricity from new nuclear power plants and coal power plants with CCS technology for carbon dioxide storage.

Certainly a lot of “if,” “when,” etc, but interesting predictions nonetheless. Believable.

It’ll be interesting to see how this all plays out. Any thoughts on Hoffman’s predictions? Accurate? Optimistic? Or still too pessimistic?

Image Credit: Solarpraxis/Andreas Schlegel