Soaring nickel prices could accelerate the use of iron batteries
As with gasoline, there is no “pure” lithium-ion battery. Gasoline is a mixture of various hydrocarbons and other components like ethanol which can vary greatly depending on location, time of year and other factors. Likewise, there is a surprisingly wide range of recipes for lithium-ion batteries, with the common element being positively charged lithium ions flowing between anode and cathode. One particular variant, the iron phosphate battery, is poised for much greater adoption in the coming years for several reasons, including the sudden spike in the price of nickel.
Electrochemical batteries are made up of a group of cells that can be connected in parallel or in series depending on the total voltage and power requirements. Each cell has four main components, positive and negative electrodes called anode and cathode, a porous separator and the electrolyte. The separator prevents the anode and cathode from coming into contact, which can start a fire, while the electrolyte provides the medium for the circulation of positively charged ions.
Over the past decade, most car manufacturers have converged on using a nickel-rich mixture to coat the cathodes, as nickel provides one of the highest energy storage capacities ever found. Nickel has been widely used in batteries for decades, dating back to nickel-cadmium cells and later nickel metal hydride cells. Most high-performance EV cells today use nickel-manganese-cobalt (NMC), with nickel making up 80% of the mix. You’re here
With nickel accounting for 40% or more of the cost of a nickel-rich cell, any volatility in the price of the metal can put significant pressure on battery prices. Last week, the war in Ukraine and sanctions against Russia coincided with nickel prices surging from around $25,000 a ton to $100,000 a ton before trading halted. This has no doubt led some automakers to reflect on their battery strategy for electric vehicles.
By the time GM was developing the first generation of the Chevrolet Volt, its choice of cell chemistry was narrowed to manganese oxide and iron phosphate (LFP), with manganese eventually being selected for production due to its density. higher energy. The LFP has significant advantages and a notable disadvantage, which means that it has never really been adopted by electric vehicles in North America.
The main disadvantage is that LFP has about 30-40% lower energy density than nickel-rich chemicals. In North America, where populations are dispersed and drivers believe they need several hundred miles of range, this has limited the LFP market. But in China, where cost is a bigger concern than range, many entry-level electric vehicles use LFP cells, including Tesla. Tesla started using LFP for the standard range version of the Model 3 in China in 2020 and in fall 2021 it went global with this approach.
While nickel-rich cells can typically sustain around 700–800 charge cycles with proper management, LFP can easily cycle through thousands of cycles with minimal degradation. LFP cells are also extremely stable and resistant to thermal runaway. Iron and phosphorus are readily available globally and inexpensive, making them very attractive for a localized supply chain.
Over the past year, while many of the world’s traditional automakers have announced their massive strategies to transition to electric vehicles, many, including Volvo, Volkswagen, Stellantis and Ford, have signaled their intention to use the LFP for at least some future models. In most cases, the focus is on the LFP for entry-level models like those in China. Ford has discussed plans to use LFP for commercial vehicles where it has a very strong market position. In many instances of commercial vehicle use such as package delivery or landscaping, vehicles are only operated in local areas and typically travel less than 100 miles per day, often at lower speeds. This makes LFP an excellent choice for its long life, safety and low cost.
More recently, Rivian announced on its Q4 2021 earnings call that its new standard range battery size debuting in late 2023 will use LFP cells instead of the nickel-rich cells used in battery packs. at longer range.
However, new developments in battery pack architecture are helping to compensate for the LFP’s energy density deficit. With the modular architecture (cells assembled into modules that are then installed into packs) of most EV battery packs today, only about 30-35% of the pack’s volume is actually made up of active cell material. Companies such as Our Next Energy (ONE) are developing cell-to-pack structural architectures that eliminate module packaging and bond cells directly. This can reach double the effective fill rate, exceeding 70%.
ONE is also developing a hybrid pack that fills part of the pack with LFP cells that have a long lifespan and the rest with higher energy density cells that can be used to extend the range of the pack when needed. . During most rides, only LFP cells are used and charged, while higher density cells experience far fewer cycles. Recently, ONE showed off a Tesla Model S with a prototype package traveling more than 750 miles from its Detroit-area headquarters to northern Michigan and back.
Developments such as raw material price volatility, growing demand for electric vehicles, and new architectural developments are all poised to increase interest in LFP cells in the years to come.