CAMBRIDGE, MA—The cost of lithium-ion battery technology has fallen dramatically over the last three decades, claims a recent analysis conducted by researchers at the Massachusetts Institute of Technology (MIT). And, they predict that further steep declines could be possible in the near future.
According to Jessika Trancik, an associate professor at MIT’s Institute for Data, Systems and Society who conducted the analysis, the cost of these batteries has dropped by 97 percent since they were first commercially introduced in 1991. “This rate of improvement is much faster than many analysts had claimed and is comparable to that of solar photovoltaic panels, which some had considered to be an exceptional case,” she points out.
“While it’s clear that there have been dramatic cost declines in some clean energy technologies, such as solar and wind, when [we] started to look into the decline in prices for lithium-ion batteries, we saw that there was substantial disagreement as to how quickly the costs of these technologies had come down,” says Trancik. “Similar disagreements showed up in tracing other important aspects of battery development, such as the ever-improving energy density (energy stored within a given volume) and specific energy (energy stored within a given mass).
“These trends are so consequential for getting us to where we are right now, and also for thinking about what could happen in the future,” explains Trancik. “While it was common knowledge that the decline in battery costs was an enabler of the recent growth in sales of electric vehicles, it was unclear just how great that decline had been.
“Through this detailed analysis, we were able to confirm that yes, lithium-ion battery technologies have improved in terms of their costs, at rates that are comparable to solar energy technology, and specifically photovoltaic modules, which are often held up as kind of the gold standard in clean energy innovation,” says Trancik.
“I can't overstate the importance of these trends in clean energy innovation for getting us to where we are right now, where it starts to look like we could see rapid electrification of vehicles and we are seeing the rapid growth of renewable energy technologies,” notes Trancik. “Of course, there's so much more to do to address climate change, but this has really been a game changer.”
"Battery costs determine price parity of electric vehicles with internal combustion engine vehicles," adds Venkat Viswanathan, an associate professor of mechanical engineering at Carnegie Mellon University, who was not associated with the MIT analysis. "Thus, projecting battery cost declines is probably one of the most critical challenges in ensuring an accurate understanding of adoption of electric vehicles."