A Techno-Economic Model for Benchmarking the Production Cost of Lithium-Ion Battery Cells

Abstract

In response to the increasing expansion of the electric vehicles (EVs) market and demand, billions of dollars are invested into the battery industry to increase the number and production volume of battery cell manufacturing plants across the world, evident in Giga-battery factories. On the other side, despite the increase in the battery cell raw material prices, the total production cost of battery cells requires reaching a specific value to grow cost-competitive with internal combustion vehicles. Further, obtaining a high-quality battery at the end of the production line requires integrating numerous complex processes. Thus, developing a cost model that simultaneously includes the physical and chemical characteristics of battery cells, commodities prices, process parameters, and economic aspects of a battery production plant is essential in identifying the cost-intensive areas of battery production. Moreover, such a model is helpful in finding the minimum efficient scale for the battery production plant which complies with the emergence of Giga-battery plants. In this regard, a process-based cost model (PBCM) is developed to investigate the final cost for producing ten state-of-the-art battery cell chemistries on large scales in nine locations. For a case study plant of 5.3 GWh.year−1 that produces prismatic NMC111-G battery cells, location can alter the total cost of battery cell production by approximately 47 US$/kWh, which is dominated by the labor cost. This difference could decrease by approximately 31% at the minimum efficient scale of the battery production plant, which is 7.8 GWh.year−1 for the case study in this work. Finally, a comprehensive sensitivity analysis is conducted to investigate the final prices of battery cell chemistries due to the changes in commodities prices, economic factors of the plant, battery cell production parameters, and production volume. The outcomes of this work can support policy designers and battery industry leaders in managing production technology and location.