Currently, the vast majority of smartphones and laptops use lithium-ion batteries. Furthermore, the burgeoning demand for electric vehicles, whether pure electric or plug-in hybrid, is gradually taking shape. Thirdly, there's the future application of lithium batteries in energy storage. Its market capacity will be even larger than that of electric vehicles, potentially reaching trillions of dollars. Currently, the requirements for electric vehicles and energy storage applications necessitate the industrialization of products with safe, high-energy-density, long-life, and low-cost technologies, in order to match the rapid development of these two industries. At present, lithium-ion power batteries are the optimal choice. This vast market demand is attracting significant R&D and manufacturing investment to the industry, promoting the rapid development of lithium-ion battery technology, resulting in the industry's recent rapid growth.
When discussing power batteries, technology is paramount. Power batteries strive for performance in five key areas: safety density, power density, lifespan, and cost. A comprehensive system is needed to ensure balanced development across these five aspects. This includes electrochemical equipment, processes, quality control, supply chain, materials, thermal management, and testing and verification—all are indispensable. Without comprehensive assurance and advanced technology in these areas, it's difficult to guarantee the core performance of the power battery. Therefore, the research and development and production of power batteries is a technology-intensive and capital-intensive industry requiring substantial investment.
Market demand
The national "12th Five-Year Plan" requirements at the end of the year were 180 Wh/kg for electric vehicles and 125 Wh/kg for plug-in hybrids. These two targets were successfully achieved in mass production when China undertook the national "12th Five-Year Plan" science and technology innovation project. After five years of effort, by 2020, China's power battery products, while maintaining the original five performance requirements, achieved an energy density of 300-350 Wh/kg, and also achieved mass production. Furthermore, a significant future application will be in fast-charging power batteries. Our goal in this area is to achieve a full charge in 10 minutes, or 4C charging capability in 10-15 minutes.
If the technology for 12-volt or 48-volt start-stop batteries for micro-hybrid applications is to be realized, it will be able to cover all aspects of the future needs of electric vehicles and energy storage applications in my country, including cost, lifespan, and performance.
Energy storage technology has a broad market.
To improve the environment and ensure energy development, two very important trends will emerge. One is on the energy production side: the proportion of clean energy will inevitably increase, including nuclear power, photovoltaics, wind power, and bioenergy. The other is on the energy consumption side: fossil fuel-based equipment will gradually be electrified and replaced by electrical equipment; electric vehicles are a prime example of this shift from gasoline to electricity. Once these two trends take shape, energy storage will play a crucial role. Lithium-ion batteries, as a broad form of energy storage, possess significant advantages and are the best choice in the market. This is because a large-scale industrial chain is gradually forming, and since it operates purely on electricity, its efficiency is relatively high. Furthermore, ultra-long lifespan technology is rapidly maturing. We are currently pursuing a single battery cell achieving 15,000 cycles, meaning a lifespan of over 20 years is more than sufficient. Its response speed and environmental adaptability are superior to other methods, therefore, energy storage technology and equipment have a very broad market prospect globally in the future.
Therefore, from the perspective of energy storage, it can be used in almost every stage, from power generation and transmission to distribution and consumption. In the future, with the continuous increase in the proportion of clean energy, and with energy conservation and emission reduction, theoretically, energy storage can be used wherever electricity is used.
A crucial factor in the energy storage business is product reliability and lifespan. Essentially, future intelligent operation should be maintenance-free, with a 20-year lifespan, while also requiring large-scale, standardized production to reduce costs. Most importantly, a tiered utilization industry needs to be established. If power batteries can achieve a 20-year lifespan, after 8 to 10 years of use in electric vehicles, these batteries can be completely recycled at very low cost and reused in grid energy storage. This places several important demands on us: cell design must ensure sufficiently long lifespan and high performance; and when manufacturing modules and electric vehicles, we must consider the ease with which future modules and electric vehicle battery packs can be integrated into energy storage systems. After energy storage is complete, the batteries can be recycled into raw materials to produce more cells. This could potentially create a complete circular economy industrial chain. Once this chain is established, each link can generate significant economic benefits, making it a sustainable development approach.
Another point concerns the cost of lithium batteries. How should we view the cost of energy storage systems? We need to approach this complex issue with a very simple perspective. The key is understanding how much it costs to store one kilowatt-hour (kWh) of electricity and then return it. The reliability and safety of the system are the manufacturer's responsibility. In 2010, based on the price, performance, cycle life, and efficiency of lithium iron phosphate batteries, including the costs of the entire inverter and management systems, the overall cost per kWh for storing and returning one kWh was 2.87 yuan. This meant that unless there was a rigid demand, it was completely uneconomical. Thanks to the efforts of our colleagues over the years, 2015 was a year of change. With the same lithium batteries and the same system, the cost of storing and returning one kWh was only 0.73 yuan. This is based on current calculations, and it's actually better. If we can reuse electric vehicle batteries at a very low cost, the overall cost per kWh of energy storage systems will be very low in the future, creating significant economic benefits.
What should electric vehicles look like in our country in the future? Imagine a vehicle that can be fully charged in 15 minutes and travel 300 kilometers. If every gas station had such a device, using an electric vehicle would be completely free of the hassles of using a traditional gasoline car. This is also the inevitable trend of future new energy applications.
