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Batteries Battle Fuel Cells, Leaving Plug-In Hybrids To Prosper

Batteries Battle Fuel Cells.

“most traditional automakers are de-emphasizing electric vehicle development in favour of fuel cell electric vehicles”

Auto manufacturers like Toyota of Japan are backing away from battery-only powered vehicles as sales fail to take-off, and hint that fuel-cells are the holy grail for future, green machines.

Investment banker Morgan Stanley detects an exasperation among manufacturers with electric cars apart from high-flying Tesla, and sees a flirtation with fuel cells, as mass market car buyers demand prices halve and range doubles before they will invest their hard-earned money in anything powered by a battery alone.

Meanwhile plug-in hybrids, which currently allow about 30 miles of battery-only driving, followed by a conventional amount of internal combustion power, are gaining ground as the preferred compromise while engineers seek to perfect the technology that will save the planet.

So, as governments demand ever more fuel efficient cars and SUVs to ward off global warming, always supposing that you can anyway, fuel cell power has the inside track?

Wrong, says Donald Sadoway, Professor of Materials Chemistry at the Massachusetts Institute of Technology (MIT).

Maybe, says Wolfgang Bernhart, Stuttgart, Germany based partner at the Roland Berger automotive consultancy.

According to Sadoway, neither batteries nor fuel cells are currently qualified to claim they have the key to the future, but least of all fuel cells. Battery power offers the best long-term solution, but huge sums need to be spent to research new techniques. The current fixation on lithium-ion batteries is heading down a cul-de-sac because this technology is too expensive for automobiles. Fuel cells fail on many counts, according to Sadoway, including high prices, the need for expensive and comparatively rare platinum, and questions of safety, problems with how they work, infrastructure, and the fact some fuel cell techniques aren’t very green anyway.

CEOs Elon Musk of Tesla Motors and Renault-Nissan’s Carlos Ghosn have both bet the ranch on battery-only power and ridiculed fuel cells.

Toyota FCV
Toyota, producer of the pioneering Prius gasoline electric hybrid and a new plug-in version, hasn’t given up on battery-only power, but it is prioritizing fuel cells because they promise better performance on long-distance driving. And it is putting its money where its mouth is. Next year it will introduce the FCV hydrogen fuel cell vehicle in Europe and the U.S., priced at close to $70,000. So obviously, the FCV won’t be a big seller at that price. Honda of Japan will also have a fuel-cell vehicle for sale next year.

Morgan Stanley, looking at the less than enthusiastic reception for battery-only vehicles, perceives a shift in mood by manufacturers.

“If anything, it seems to us most traditional automakers are de-emphasizing EV (electric vehicle) development in favour of other technology (FCEVs – fuel cell electric vehicles),” said Morgan Stanley in a report backing investment in Tesla Motors, after Musk announced the opening up of the electric car maker’s patents.

Morgan Stanley wondered why traditional automakers aren’t seeking to commercialize 200 mile range electric vehicles.

If in fact automakers are abandoning electric vehicles for fuel cells, they are heading up a dead-end street, says MIT’s Sadoway.

Ferrari prices
“I don’t think fuel cells will be the way to go. Sure you can build one, but to a Ferrari price point,” Sadoway said.

Sadoway said fuel cells were questionable for a string of reasons. It was difficult to store hydrogen on board a car that was safe and crashworthy. Electrodes using expensive platinum among other things producing hydrogen would foul over time, slowly poisoning the catalyst; the fuel cell would gradually lose efficiency. Platinum was fairly rare and prices would rise with demand. The infrastructure to provide feedstock for hydrogen would need to be established at huge cost. Some methods of producing hydrogen were far from green.

So batteries are the answer?

Not if current investment levels aren’t dramatically increased.

“I believe it could be if the investment is made in the research for a better battery. We are stuck in the rut of lithium ion. Manufacturers continue to try and make improvements. I think this technology is far too expensive for auto applications. From my perspective it is time to change the chemistry and look for radical innovation which would result in longer range, lower cost and longer service time,” Sadoway said.

Companies like German luxury car maker BMW are pursuing lithium ion batteries with its i3 battery city car and i8 plug-in hybrid super-car.

Last year, when BMW was getting ready to launch the i3, BMW board member Ian Robertson said that in the next three to four years there will be more progress in battery development than in the previous 100 years.

Spending foolishly
That didn’t impress Sadoway.

“They have the ability to see things I can’t,” he said.

Sadoway reckoned that current battery technology was severely underfunded, and most funds were squandered on incremental improvements to lithium ion technology.

“We are spending money, but foolishly,” he said.

Roland Berger’s Bernhart agreed that plug-in hybrids were emerging as a compromise candidate.

“Plug-ins are a kind of intermediate technology but will probably be successful for at least 10 or more years,” Bernhart said.

Already in Europe, the Mitsubishi Outlander PHEV (plug-in hybrid electric vehicle) is notching up impressive sales. The Outlander PHEV uses a gasoline engine as well as a battery. The Volvo V60 diesel-electric PHEV is now on sale. Volkswagen will soon bring its Golf to market with a PHEV, and its new Passat will have one too.

Meanwhile big improvements were required in battery technology including a move away from lithium ion in order to improve the range and cost.

”Lithium ion can be improved even after 2020 but there are limitations and the question is are there other technologies like lithium sulfur which might now be in the laboratory,” Bernhart said.

Fuel cells for long range
Bernhart believes that fuel cells are definitely in the race, and will eventually be used to power bigger cars over longer ranges, while new generation chemistries will power battery cars mainly in urban areas.

MIT’s Sadoway doesn’t expect much progress in battery technology by 2020 and not much more by 2030 unless massive new investment is forthcoming. The battery of the future will use a much more widely available and cheaper commodity than lithium. Magnesium is a candidate while aluminum or even iron could be used. Even if the range didn’t improve much beyond 125 miles, if that meant the price of a car was around $20,000, a battery-only car could be successful.

Sales of electric vehicles have been a massive disappointment to proselytizers. When battery-only vehicles began to appear, first responders like Renault of France and its Nissan affiliate reckoned by 2020 around 10 per cent of the world’s car sales would be battery-only. Now Barclays Equity Research says this will only reach 1.5 per cent by 2021, with 3.3 per cent in Europe and 1.0 per cent in the U.S. Renault-Nissan has admitted it won’t make its target of 1.5 million electric vehicles by 2016, only selling about 120,000 so far.

If this trickle of sales is going to be transformed into a tsunami, drastic investment is required.

“We should be putting money into radical innovation, not incremental improvement. The government should step in. This is an appropriate role for government research. We need a long-range breakthrough. Manufacturers are too risk averse, worrying about short-term profitability. This takes a government agency charged with the task of stimulating radical innovation. Right now investment decisions are tightly coupled to near-term profits which filter out new ideas,” Sadoway said.

“If this is going to take 15 or 20 years, we better start this afternoon,” Sadoway said last Wednesday.

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