Electric vehicle battery costs in 2021 – 87% lower than in 2008
The electric vehicle market has changed dramatically over the past twelve years. Most of this transformation comes down to one thing: falling battery prices. As battery prices have come down, various models of electric vehicles have achieved greater range for the same price, and many other models have entered the market with a competitive mix of price and specification. Here’s a chart I created about a year ago on this trend:
The Nissan LEAF provides one of the simplest examples of this, as the price has been fairly stable while the range at full load has more than tripled. (Note: the base 2022 Nissan LEAF still has a range of 226 miles.)
The US Department of Energy recently highlighted this trend in its own way as well. Most useful is this spectacular graphic:
“Research conducted by the Vehicle Technologies Office of the Department of Energy (DOE) estimates that the cost of a lithium-ion battery for electric vehicles decreased by 87% between 2008 and 2021 (in constant 2021 dollars)”, writes the DOE. “The 2021 estimate is $ 157 / kWh on a usable energy basis (the equivalent of $ 143 / kWh on a nominal energy basis) for large-scale production, or 100,000 units per year. This compares to $ 1,237 / kWh based on usable energy in 2008. The lower costs are a combination of improvements in battery technology and chemistry and an increase in manufacturing volume. “
The 2021 data used here are preliminary data. The sources cited by the DOE are as follows:
- 2018-2021: US DOE, Vehicle Technologies Office, using BatPaC from the Laboratoire national d’Argonne: tool for estimating battery manufacturing costs.
- 2017: Steven Boyd, DOE, Vehicle Technologies Office, 2017 Annual Merit Review, Batteries and Electrification R&D Overview, June 18, 2018, PowerPoint presentation, p. 7.
- 2016: David Howell, DOE, Vehicle Technologies Office, 2017 Annual Merit Review, Electrochemical Energy Storage R&D Overview, June 20, 2017, PowerPoint presentation, p. 6.
- 2008–2015: National Academies of Science, Engineering, and Medicine 2017. Review of the US DRIVE Partnership Research Agenda: Fifth Report. Washington, DC: The National Academies Press, p. 173.
Of course, you can’t talk about it without talking about Tesla. We don’t know Tesla’s battery costs, but we do know that it was at the forefront of cutting battery costs for years, and probably still is. Plus, I’m old enough to remember when Elon Musk, JB Straubel and their team announced that they would build a giant “gigafactory” to build a lot more batteries (as many as those produced by all the companies in the world. last year) . Aside from the simple need for the batteries (for the Model 3, which at the time hadn’t even been revealed), Tesla’s goal was to cut costs by increasing the scale of production. At the time, it was considered a crazy idea. Tesla critics have said that will never happen. A few gigafactories later, not only did it happen, it clearly worked. You can now buy a Tesla Model 3 with a range of 262 miles for $ 41,990. The car has much better technology than a Tesla Model S 8 years ago for a much lower price. Due to the same battery price trends (and a few other factors), this is the growth in Tesla vehicle sales over the past 9 years:
There is no way this graph would look like this if battery prices had not fallen significantly during this time period.
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