A recent report documents a significant drop in the price of batteries just as electric vehicles are taking off in new directions.
The market research firm Bloomberg New Energy Finance (BNEF) released its “2019 Battery Price Survey” on December 3.
The report examines the worldwide market for batteries. It finds that prices for batteries have fallen 87% in real terms, from $1,100 to $156 per kilowatt/hours (kWh) between 2010 and 2019.
A number of factors have contributed to this sharp decline according to Bloomberg. Increasing order size, growth in battery electric vehicle sales and the continued penetration of high energy density cathodes have all played a part.
BNEF also finds that the drop in battery prices has come at the same time that electrification has expanded into different sectors of transportation, such as commercial and high-end passenger vehicles.
The survey forecasts the trend of falling battery prices to continue. BNEF projects battery prices to reach $100/kWh by the year 2023. New pack designs and falling manufacturing designs are expected to support that trend going forward.
Not coincidentally, the company also sees that as a bit of a tipping point for the electric vehicle sector, describing $100/kWh as the point at which EV’s reach price parity with traditional, internal combustion engines.
Of course, the trends are mutually reinforcing. As prices drop for batteries and EVs, sales will also continue. BNEF expects the worldwide battery market to be worth $116 billion by the year 2030.
BNEF suggests that battery prices may fall even further, reaching $61/kWh by 2030, with new technologies like silicon or lithium anodes, solid state cells and new cathode materials, all playing a part.