TCO Analysis of Nanophosphate EXT Micro Hybrid Battery vs. Lead Acid

One of the primary applications for A123’s newly launched Nanophosphate EXT™ lithium ion battery technology is expected to be micro hybrids, a growing segment of the electric vehicle market that analyst firm Lux Research says could reach as  many as 39 million vehicles globally in 2017, creating a $6.9 billion market for energy storage devices. 

Battery systems built with Nanophosphate EXT are designed to operate over a broader temperature range without sacrificing performance, power capabilities or cycle life. For micro hybrid applications specifically, Nanophosphate EXT is able to deliver high power—or cold cranking amps—at extreme low temperatures, effectively eliminating the only performance advantage of absorbent glass mat (AGM) lead acid batteries for micro hybrid vehicles. A123 testing shows that a 60Ah system built with Nanophosphate EXT is capable of delivering about 700 cold-cranking amps at minus 18 degrees Celsius, putting it on par with the best AGM batteries available today. 

While this represents a significant technical breakthrough, questions remain about cost potentially limiting the near-term micro hybrid market share that lithium ion may capture. Lithium ion does carry an initial cost premium, although to clarify misconceptions and speculation, the price delta between AGM batteries and A123’s micro hybrid battery in volume production is expected to be around $250. 

But more important than the nominal difference in initial cost is total cost of ownership (TCO) over the life of the battery system. The cold-cranking performance offered by Nanophosphate EXT enables automakers to benefit from the significant additional advantages of A123’s micro hybrid battery as compared to AGM lead acid. 

For example, A123’s battery has a greater charge acceptance rate than AGM, enabling it to charge up to 10 times more quickly, enabling the battery to capture substantially more energy during vehicle braking. Once the braking energy is captured, it can be used in several ways to deliver a fuel economy improvement of 50 percent more than what a comparable lead acid start-stop system can offer. A123’s lithium ion micro hybrid battery also weighs less than half of comparable lead acid batteries and is designed to last at least twice as long as AGM batteries. 

Collectively, these performance benefits contribute to a lower TCO, and as shown on the chart, A123 expects the recovery of the initial premium cost of its battery will occur in three years or less. At that point, the cost to replace the AGM battery (perhaps more than once) coupled with the increased fuel savings of A123’s micro hybrid battery results in a lower TCO over the life of the micro hybrid system. 

Additionally, current cost reduction initiatives continue to bring down the cost of lithium ion battery systems, which should further reduce the price delta between A123’s micro hybrid battery and competing AGM lead acid. As the global market for micro hybrid vehicles grows, the performance benefits enabled by Nanophosphate EXT and a reduced TCO should allow A123 to compete favorably. 

As for the question of commercial availability, A123 is scheduled to enter full-scale production next year with a mainstream European automaker on a micro hybrid battery system built with Nanophosphate EXT technology. With this product validation in its final stages, solutions using Nanophosphate EXT are expected to be on the road less than a year from now.