By Allen Penticoff
Tesla Motors has plans in the works to be a “battery gigafactory” to lower the cost of making lithium-ion batteries that power their car models. It is believed electric cars, which are really much simpler and functionally better cars than gasoline-powered cars, cannot reach pricing parity until the cost of batteries is in the range of $100 per kilowatt-hour (kWh) of storage capacity. This pricing is within reach with present technology. Future technologies should bring even lower battery costs — perhaps $50 per kWh by 2030.
A 2015 Chevy Volt carries a battery capacity of 17 kWh, while the top-end Tesla S sedan batteries can store 85 kWh of power. Industry analysts believe Tesla is presently paying $200 to $250 per kWh for the batteries it acquires from Panasonic, although neither company has ever released its battery costs.
But Tesla has vowed to bring battery costs down by at least 30 percent by 2020, with expectations that this price reduction will happen long before that. To that end, they should soon (if not already) be breaking ground in the Nevada desert to build a giant factory powered by renewable solar and wind energy. The site is 500 to 1,000 acres in size, and the building itself will be one to two levels with 10 million square feet of space. Once this factory is in normal production, Tesla will not only have a source of ever less expensive batteries, but will be supplying them to other manufacturers as well. They will become the dominant electric vehicle battery supplier in the world. It is expected the battery gigafactory will employ 6,500 people.
This is exciting news for proponents of electric-powered vehicles. A Credit Suisse report recently analyzed the Tesla Model S sedan point-by-point and determined that not only is it an excellent car, but that it is superior to gasoline-powered cars in nearly every category. Their report says, Tesla “proved electric cars are better.” However, the public and industry don’t know it yet. (And that’s why Mr. Green Car writes so much about the topic.)
I am constantly seeing reports of new electric cars coming to market. It is hard to keep up with. I don’t report on them, as most are unavailable to me to personally review. But here are a few new cars you may wish to know about and search for more information on: SmartCar EV, Fiat 500 EV, Kia Soul EV, and the Tesla X. I do hope to do reports on these in time. But all electric cars, big or small, suffer from pricing disadvantages as a result of battery cost. Presently, it still takes someone very dedicated to the idea of driving an EV to overlook the new car price.
If you want to get into driving an EV now, but don’t think you can afford it, I suggest looking for a used vehicle. I have seen Nissan Leafs listed on the Internet in our area for $17,000. Once you factor in you won’t be buying gas any longer and will only be paying about $30 a month more for your electric bill, you may find one of these very affordable. Or, if you have some money invested and need to take it out, buy an EV and you can still get $11,500 in tax credits ($7,500 federal, $4,000 state of Illinois). Those credits can take a lot of the tax bite out of a big capital gain tax, and you get to drive a nice, new electric car around.
At the recent 13th Annual Illinois Renewable Energy and Sustainable Lifestyle Fair (Aug. 23-24 at Ogle County Fairgrounds near Oregon, Illinois), I had a presentation about “Living with a Chevy Volt.” A question that always arises is: Won’t you have to pay a lot to replace the batteries in the future? First, the batteries are warranted for 100,000 miles. Second, GM has developed a patented system to rejuvenate the batteries that should cost much less than replacement to extend the battery life. Third, we just don’t care — we love driving on clean electric power … we can make more money, but we can’t make more air. At present, everyone wants to know the payback time of electric versus a cheaper gas-powered car. Our air is priceless — stop trying to make this bank account justification. If you can afford to own an electric car now, you should consider it your moral duty to do so. In time, Tesla’s battery gigafactory will be bringing down the price of electric-powered cars into the everyman price range — and thankfully that won’t be too far off.
From the Sept. 3-9, 2014, issue