Not being cynical but genuinely curious: Is that rate of price decrease (15%) expected to keep up in the near/medium term? Is there any sort of Moore's law for battery cost?
It’s called the manufacturing learning curve, it was discovered in the 1940s relating to WWII aircraft production, and it’s not a special property of semiconductors. Just somehow “Moore’s Law” got popularized in the press.
No other technology stayed on as steep an exponential improvement curve for 60 years in the way semiconductors did. They were, in fact, quite remarkable.
I think transistors were unique in that we had/have a serious ability to consume more of them. Compuers are half price?!! I'll take three.
When the price of computing halved, we consumed more than twice as much, so that the industry still grew. Most other products/industries didn't have that kind of demand curve. Eventually, we had enough textile and we were happy to pay less for more (rather than pay more for way more). The textile industry stopped growing and learning/price reduction slowed too.
When the price of computers dropped, we paid the same for more powerful computers and more people decided to buy computers because the computers were now more useful. When compuers got powerful enough that we started paying less per computer, we still bought more computers in the form of ipods, VR goggles and smart toilets.
More demand, more production, more learning, lower price...question: If the product is cheaper, will you spend more or less in total? If the answer is "yes," rinse and repeat until the anser is no.
When people learned how to use coal more efficiently in 19th century England, that didn't result in less coal being used. It meant that it became economical to do more things with coal, and overall coal consumption increased.
If you consider the potential long term demand, the battery market is facing an increadible growth too. The current electric car production is below 1 Million/year, that is about 1% of the total car production, so the market for batteries for electric cars alone can grow about 100x, not counting in that the capacity per car might also grow (perhaps not much over the 100kWh for the top Teslas, but in average probably over 60kWh/car).
On top of that come all the new usages for batteries, especially energy storage, be it for individual houses or on the grid scale.
So potential market capacity is for long time no limitation for batteries. The unique thing of the semiconductor market development was though, that the chips grew in capabilities, but very little in size.
This can be explained by the incredible applicability (and thus demand from business and opportunity creation). We literally had nothing alike before and then suddenly we could do so much more.
Moore's law was always partly an economic phenomena - that companies figured things would improve by x per year and so invested accordingly to keep up with their competitors. I imagine something similar will happen with batteries. It relies on there being a lot of demand to fund the investment but I think that will be the case here - indeed battery spend per year will probably pick up as they become more practical for cars and grid use. These things can end or morph as you hit limits from the laws of physics as is happening with Moore's law but there seems a way to go with batteries.
Then another 25 years from the 262 do the 737, then twice as many years from the 737 to the 737 MAX. I always think of aviation when someone tries to extrapolate technology.
(PS: imagine the bold branding experiment if they had called it "50 years anniversary edition" instead of "MAX")
Reminds me of the B-52, which first flew less than 50 years after the Wright Flyer, but will have been flying for about a hundred years by the time it is retired. Feels like we haven't really fundamentally changed aviation technology since the early days, just incremental improvements in materials.
Even supersonic flight was common by the 1950's. The obvious breakthroughs from here, like hypersonic flight, have been achievable but expensive and not worth it since the 1970's or so.
Prices of commodities tend to asymptotically approach the cost of their inputs in a free market. When I was into it a few years ago, I recall hearing the materials cost was about 3% of the cost the batteries and the energy requirements of production are low, so perhaps there's still about 15-20 years of 15% price reductions?
Over the next decade, solid-state lithium batteries will likely become commercialized. That should provide enough headroom to keep the improvements going for quite a while.
Standard manufacturing and scale improvements should keep things going for several more years, even without a major change to chemistry.
the new solid state lithium batteries being developed are pretty astounding. i think i saw a video of a phone being powered by one, then the demonstrator cuts the battery in half while the phone is being powered by it and nothing happens -- the phone stays on.
could have been video trickery but I think the demo was legit. Once that technology goes mainstream it's gonna be as revolutionary as the increases in lithium ion energy density. We're on the cusp of some incredible battery breakthroughs in the very near future! The fact that the new tesla roadster (admittedly expensive at $250k) has a 600 mile charge capacity is aboslutely astonishing.
oh interesting. definitely not the video i remember seeing, but that demonstrates the same thing very well, and makes me more confident that the previous video I saw was legit. thanks for sharing!! The cutting action happens around 32:07 for anyone wanting to watch
Moore's law is a (awesome) example of what economists call "learning curve" specifically for transistors. Generally, economists model unit cost as Y and cumulative unit volume as X.
The industrial revolution was all about learning curves. Production grew, got better, leading to lower prices, leading to more demand, more production, more learning, lower prices, more demand... untill everyone had as many forks, socks and radios as they wanted.
But... Moore's law is usually represented as price over time instead of units. Half the unit cost every 18 months.
Early-ish in the tesla days elon went on a sort of rant. I think underlying it is/was this difference between "x as unit volume" or "x as time." "Time" made technologists think of learning curves in semi-supernatural terms. They either exist or they don't.
Moore's law was so consistent for so long, we just viewed it as a constant, but traditional economists would say it was/is a function of all the computers that got produced. Elon would say it's a function of hard work at intel, etc.
The upshot is the same though. As more batteries are made, more people work on battery manufacturing methods & R&D, the price declines.
There's no guarantee that it'll be proportional to volume but... new energy tech (batteries, solar, EVs) is now crossing price-parity thresholds in all sorts of applications (like grid power). That means more demand, more learning, lower prices, more demand.