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Summary:

Battery innovation might be the rage — and much needed — but it’s super hard for Silicon Valley and the entrepreneurial ecosystem.

Amprius cell

The New York Times writes this weekend that batteries, “long the poor cousin to computer chips in research-obsessed Silicon Valley, are now the rage.” It’s true that the battery has long been an obstacle for increasingly power-hungry gadgets and is now being looked at much more closely for the emerging markets of wearables, as well as electric cars. But Silicon Valley, startups and entrepreneurs haven’t made all that much progress creating battery innovations.

Toq battery

Batteries for wearables are needed.

Here’s why:

1). There’s no Moore’s Law for batteries: Battery progress moves much more slowly than the progress of computing, which follows the relatively rapid Moore’s Law. As Bill Gates has said, that quick rate of innovation has in effect spoiled us into mistakenly thinking other sectors beyond digital can move at the same rate as Moore’s Law.

It’s really difficult to deliver battery innovation from the lab to the commercial market on a timeline that a startup, particularly one backed by venture capitalists, would want. Look at the battery startup Envia — it has promising longer-lasting battery tech, but the company lost a deal with GM this year because it couldn’t hit the commercial milestones fast enough.

Envia's battery factory

Envia’s battery factory

2). The valley of death between lab and commercial product: Battery innovations also need a large amount of money and need to reach a large scale to get from the lab to a commercial product. The New York Times article quoted the chief technology officer of A123 Systems, and described A123 as “a company that makes batteries for electric cars and invests in start-ups that are developing new battery technologies.” Not mentioned is that A123 was one of the few battery startups out of Silicon Valley and it was recently hit hard by the slower rollout of electric cars. It went bankrupt, and then was subsequently bought by Chinese company Wanxiang.

3). Progress comes from the battery giants: Much more of the progress around batteries for cell phones, laptops, wearables, and even electric cars, will likely come out of the labs and factories of the Asian battery giants, like Panasonic. These companies have the scale, the funds and the expertise to work on different types of incremental progress that can reduce the cost of the battery and also make it better — longer lasting, safer and more energy dense. That’s why electric car maker Tesla Motors made a strategic bet at the beginning of its life to buy standard small-format lithium-ion batteries from companies like Panasonic, instead of relying on next-gen or electric car specific batteries.

Tesla Model S battery

Tesla Model S battery

4). The lack of battery expertise in the Valley: Building battery technology, scaling it and commercializing it is vastly different than running an internet or software company. There’s a lack of executives in Silicon Valley who have expertise with scaling battery technology businesses, and I’d be wary of any CEO or big name exec that’s running a battery company that doesn’t have the domain expertise.

5). Look to the power grid instead: While building a better lithium ion battery for gadgets is tough for a startup, there are actually quite a few startups that have made headway building large stationary batteries for the power grid. These batteries need to be super cheap and safe, but since they don’t have to be small, wearable, and moveable, there’s more flexibility with new materials and designs. Startups, backed by VCs, that are making next-gen power grid batteries include Ambri, Aquion Energy, Eos Energy, and more.

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  1. Not mentioned are researchers in academia and national labs, who aren’t pressured by coming up with ideas that are easily profitable. Argonne National Lab does a lot of work in batteries, for instance.

    1. Katie Fehrenbacher Patrick Monday, February 3, 2014

      Thanks Patrick. Good point.

  2. Are we just giving Envia a pass or are we acknowledging the possibility the “breakthrough” there was a fraud?

    As for the rest, you make terrific points as usual, but I think there’s a different issue here that is getting a bit of the short end. It’s pretty pointless to develop a lab-based “solution” to the battery problem that doesn’t also come with some means of being manufactured efficiently. The poster child of green-tech idiocy, Solyndra (which deserves most of the criticism it received), at least had done that. “It’s going to cost us hundreds of millions to build a factory to make these silly solar cylinders, ok?”

    These battery “breakthroughs” that exist in handmade prototypes which no one has any clue how to manufacture at the scale of the cells in Teslas (not the whole batteries, just the cells) are not breakthroughs at all. They are lab experiments. If we want a breakthrough, fund research in the next stage, which is bringing the promising anode/cathode/electrolyte technologies to the manufacturing stage.

    Once you can pilot a way to actually make a battery based on silicon cathodes coating with polymers to protect against breakage, you can absolutely raised venture funding. And you have a really good chance of building a $10 billion company.

  3. Katie Fehrenbacher Monday, February 3, 2014

    Hi Mark,

    Envia’s breakthrough could have been fraud, but that’s also a hard thing to prove in the world of high-risk startups. When they won the ARPA-E grant, Envia said it had been independently validated by Crane http://qz.com/158373/envia-the-mysterious-story-of-the-battery-startup-that-promised-gm-a-200-mile-electric-car/#/h/36031,4/. Also the execs that accused the company of fraud asked for their case to be dismissed, probably because they didn’t have the legal evidence to pursue the case (that last part is my speculation as they wouldn’t comment on why they asked for it to be dismissed): http://gigaom.com/2014/01/19/former-envia-execs-that-sued-the-company-ask-for-dismissal-of-case/.

    So definitely could have been. But hard to know.

    Best,

    Katie

    1. Awesome, thanks for the additional updates.

  4. What would battery capacity look like graphed against processor power (maybe avg transistors of an avg Intel processor)? It would be interesting to see an article that shows what battery tech improvements have been made over the last 30 years.

  5. Good article. Here in New York State, we’ve recognized several of these factors and have invested in building a facility to provide a set of shared industry resources for prototyping and testing of batteries and systems. The BEST Test and Commercialization Center is a joint effort between the New York Battery and Energy Storage Technology Consortium (NY-BEST) and DNV GL (formerly DNV KEMA), a world leader with more than 80 years of experience in inspections, testing and certification throughout the world. This shared resource is available to industry participants on a pay-for-service model, making this key set of capabilities available as needed to support commercialization of battery technologies. NY-BEST also provides access to individual experts, supply chain partners and other resources to help move ideas from the lab to the marketplace.

  6. howgreenisyourgarden Tuesday, February 4, 2014

    6th Reason: High density batteries are probably our civilization’s current limiting technology.

    In ‘god’ video games such as Civilization, we have technology trees. Often, there are a few real game changing ‘breakout technologies’ that enable lots of new tech-branches. If we don’t have those technologies then they become our limiting technology. Without them, we cannot progress along the tech tree.

    The human race’s current limiting technology is ‘batteries with power densities of the order of gasoline’. If we had that, autonomous robots would immediately become a reality, our cell phones would be supercomputers, and Star Wars would be a reality within 20 years. Computing power stopped being a limiting factor because we can network it. Rather, its lack of portable high energy density batteries that is preventing all sorts of technologies becoming reality: we will get the ion warp drives and laser beams as soon as we have the batteries to put in them!

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