Average cost of Li ion cell to fall below $100/kWh in 2023 :Says Report.


Average cost of Li ion cell to fall below $100/kWh in 2023 :Says Report.


In an electric vehicle, 30-40%  of the total cost constitutes the battery cost. As battery cost remains high, overall cost of EVs are high, which is the biggest hurdle of electric vehicles. Reduced battery cost is crucial for wide acceptability of EVs.

In this  article you can read the details of analysis by IHS Markit, which says average Li ion cell cost will be reduced below $100 per kWh by 2023.

In a recent analysis by IHS Markit, A British company that provides market analysis and research, Li ion battery cell price will fall below $100 per kWh in next three years. This batteries will be used to power various products and among them Electric vehicles are the important ones.

IHS also analysed average cost of Li ion cell is expected to decline further to around $73 per kWh in 2030. The report says average cost of Li ion battery cell have fallen 82% from 2012 to 2020. Further reduction in price is necessary to wide acceptability of electric motoring.

Main factors for the falling of battery cost as per the analysis are:-

  • Reduction in manufacturing cost because of introduction of larger factories which leads to economies of scale.
  • Reduction in material cost by improving efficiency.
  • Battery energy density improvements.
  • Adopting low cost cathode compositions.
Senior analyst of IHS Markit, Youmin Rong said " Cost is the name of the game. Technology advances and competition between the different types of lithium ion batteries is driving prices down. Ultimately, the two major growth markets - Transportation and electric grid storage - depend upon lower costs to make batteries more competitive with the internal combustion engine and fossil fuel power generation".

All the major types of Li ion battery cells are expected to fall below $100 per kWh by 2024. In this Lithium ferrous phosphate (LFP) remains the lowest cost option in next ten years. Also NMC and NCA will continue to command in their respective applications.

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