The Obama administration’s initiatives to invest in advance battery technology often get a bad rap, mostly because there’s an ideological bias against government “picking winners.” That’s an unfortunate bias on many levels. The demand for increased battery capacity is growing across the globe and the game is on for who will be poised to capture market share.
As this post from the Energy Dept. points out:*
–Every major auto maker is working on battery-powered cars and 40 hybrids or electric are already on the market;
–“…today’s electric vehicles are fueled for the equivalent of about $1 a gallon — and the next generation will bring even bigger savings.”
–The gov’t’s investments in this area have proven to be key seed capital, met at least dollar-for-dollar by private investors. Moreover, as is usually the case, as technology advances, prices come down:
Prior to this investment, a battery with a 100 mile range cost $33,000. Because of technology improvements and the high volume manufacturing capability we have today, the estimated cost is down to about $17,000 and is expected to drop to $10,000 by 2015. As costs come down even further, the market for hybrids and electric vehicles – which has nearly doubled in the U.S. since last year – will grow even further.
Thanks to these developments, the US is on track to claim significant market share of global battery production and that’s helping to create jobs in lots of different places:
From the Dept of Energy link above:
- This summer, Rockwood Lithium announced the opening of their expanded manufacturing facility in Kings Mountain, North Carolina. They have hired 75 workers and plan to hire even more as their business continues to grow.
- The Delphi plant in Kokomo, Indiana, which had been hit by devastating layoffs during the great recession, is growing again as workers produce components for hybrid electric vehicles.
- Earlier this year, EnerG2 celebrated the opening of its new electric vehicle battery components manufacturing facility in Albany, Oregon.
- Envia Systems of Newark, California, building off technology invented at Argonne National Laboratory and developed with the help of a decade of sustained support by the Department of Energy, recently achieved a breakthrough that will triple the energy density of their batteries while cutting the cost of batteries in half.
To criticize these developments as picking winners, you’ve got to be wearing some pretty thick ideological blinders. To me, it looks like the recognition that a new, vital sector is poised to expand. We can watch from the sidelines or get in the game. Fortunately, we’ve chosen the latter so far.
*As I noted in a C-Span debate on trade and manufacturing policies, the Energy Dept. link also tells the A123 story I referenced in the debate. (h/t: GM)