The cost of lithium-ion batteries has plummeted 70% in 18 months and battery densities have increased, making it easier for manufacturers to offer better performance at no extra cost, Greentech Media reported last week.
“It’s happening. The capacity is out there,” Larsh Johnson, chief technology officer at Stem, Inc., told Greentech’s Stephen Lacey. “There are new markets opening up because of what we’ve seen in battery pricing.”
While the 68 megawatt-hours of battery capacity Stem has installed are mostly intended for mid-day peak-shaving, the company “is now getting customer requests for systems that can provide four or more hours of storage to support grid management services, such as frequency regulation or load-shifting to support renewable energy integration,” Lacey writes. “The company is also looking at a broader geographic range, which includes Texas, Germany, and Ontario.”
Lacey attributes the rapid drop in price to expanded production of lithium-ion batteries worldwide, coupled with slower-than-expected uptake of electric vehicles. The result is a price break for stationary storage vendors. Of the 70% cost saving, buyers are saving 40% because of the oversupply and 30% through bulk buying, estimated Ravi Manghani, director of the storage practice at GTM Research.
GTM expects average LiON costs to reach US$217 per kilowatt-hour by 2020, but “we’re already starting to hear numbers in the $200 to $250 per kilowatt-hour range,” Manghani said.