Donald Saxman, BCC Research
Rechargeable batteries are routinely used in portable product and stationary power applications including computers, cellular phones, and uninterruptible and emergency power supplies. More recently, rechargeable vehicle batteries have evolved from relatively low performance industrial vehicles to electric vehicles that rival internal combustion vehicles in performance and exceed their efficiency. This revolution in battery power has been possible through a systems approach that includes advanced batteries, smart microcontroller battery chargers and power conditioners. The market for “battery control technology” now impacts the commercial and consumer electronics market, the transportation market and the electrical power generation market, among others.
Ultimately, the market for batteries drives the market for battery control technology: chargers, smart batteries and conditioners. Batteries are used to accumulate and transport electrical energy. These functions, power storage and power portability, make batteries essential to today’s industrial and consumer-oriented society. Although simple batteries have existed for at least two hundred years, the battery industry traces its roots to the early 1900s. At that time, the commercialization of automobiles and radios created a demand for automotive (starting, lighting, ignition and generator) batteries and portable appliance batteries. These markets, characterized by primary (disposable) and secondary (rechargeable) batteries remain the two areas where most batteries are consumed. With the growth of the markets for secondary batteries, the market for battery control has grown. Starting in the 1960s, the wider commercialization of sealed nickel-cadmium batteries and then sealed lead-acid batteries created competition between primary and secondary batteries for some consumer applications. This development also created a market for whole new kinds of battery control technology.
Toward the end of the 20th Century, the global battery market was considered mature, with demand closely related to the sales of either automobiles or various consumer products. Likewise, in many cases, the market for battery control technology was considered mature. Since then, there has been a change in this relationship. For instance, improved microelectronic battery charger controller technology is allowing the commercialization of whole new classes of batteries and is improving the marketability of existing battery systems. This in turn has allowed the commercialization of products (notably portable computers, cellular phones, multi-functional handheld products and electric vehicles) that would be impossible without improved battery control technology.
Defining the Battery Control Market: This analysis divides the battery control technology market into five sub-sectors based on the type of consumer.
• Traction, marine and aviation
• Portable products
• Stationary (uninterruptible power supply, emergency, remote)
• On-Road electric vehicles
Then, the market is organized by type of battery control
• Battery chargers
• Battery conditioners
• Smart battery systems
Improving Battery Control Product Technical Maturity: Battery designers (mainly electrochemists) and battery charger, conditioner and converter designers (mainly electrical and electronics specialists) will continue to operate together, with new batteries and new battery control techniques evolving together to produce even higher performance products. Therefore, there are still areas where the battery control technology industry could experience the explosive growth usually associated with emerging industries. Below are a few examples.
• One trend today is to commercialize microprocessor-controlled battery chargers that deliver greatly improved performance (in terms of cycle time, battery life extension, etc.) This trend toward improved battery charger performance is the most important driving force in the battery charger industry. This trend is especially prevalent in the portable product sub-sectors, but is also true with automotive, traction and stationary battery control technology.
• Another trend is toward consumer convenience. This includes uniquely functional packaging, wireless chargers that do not include direct connectivity to the battery and fast charging options.
• Fast charging is especially desirable in electric vehicle (EV) battery chargers. Consumers are willing to pay many hundreds of dollars more for EV chargers that can “fill up” an EV’s battery in a few hours, as opposed to overnight.
• The possibility of smart automotive batteries (discussed separately) is another example. On the other hand, the advent of highly reliable, sealed, low maintenance automotive batteries has actually been a disincentive to battery charger sales to the public, as have dual automotive batteries.
• Alternative power sources can also be coupled with battery chargers. Options include hand cranks, small wind power systems and photovoltaic power generators.
Improving Battery Technical Maturity: Another major battery control technology industry driving force is also due to technological advancement. Ultimately, battery charger performance must match rechargeable battery performance. Although many battery chargers are general purpose and operate with a variety of battery types, there is a trend to optimize battery charger performance with specific battery systems. This is especially true with smart battery systems, where battery and charger must be designed as an integral unit. Again, this trend is prevalent in the portable product battery market sub-sectors, but is also true with automotive, traction, stationary and especially on-road electric vehicle power systems.
Emerging Battery/Battery Control Applications: New markets for battery-powered devices are sparking new markets for battery control technology. This trend is somewhat masked by a tendency to include battery control technology as an Original Equipment Manufacturer (OEM) component engineered into the battery-powered device. Examples include portable computers, cellular telephones and multi-functional handheld devices of all kinds. Eventually, smart traction and automotive batteries will also be important. Of particular interest is the battery-powered vehicle market including both hybrid vehicles (with internal, highly integrated charging systems) and plug-in systems including both plug-in hybrid vehicles (PHEVs) and pure battery-powered vehicles with either external chargers or on-board chargers, or both.
New Battery/Battery Control Distribution Opportunities: Another major battery control technology industry driving force is also due to market forces. For instance, during the 1990s, nickel-cadmium battery companies and a few specialty electronics outlets such as Radio Shack marketed consumer battery chargers. Now, consumer battery chargers are distributed by all the major consumer battery companies, albeit some more so than others. At the same time, the channels of distribution for consumer battery chargers have expanded to the point where they are available in most kinds of retail outlets (Internet outlets, hardware stores, department stores, discount houses, drug stores and even many grocery stores). This trend is not particularly apparent with automotive, traction or stationary battery control technology.
The Promise of the Electric Vehicle Battery Charger Market: EVs have been a commercial reality for more than 100 years. This report author’s grandfather owned a thriving business that provided Exide lead-acid battery packs to 1920s EV users. Shortly thereafter, inexpensive gasoline and an ever-increasing desire for performance ended widespread EV use. Oil shortages and an increased concern for the environment began to revive the industry in the 1970s, but wide adoption of various types of EVs always seemed just beyond the horizon: as soon as gasoline cost more than $1 a gallon, or $2, or $4; or as soon as batteries improved to the point at which they could power a car for 40 miles; or as soon as batteries could be recharged in less than six hours.
All these technological and market forces were resolved or exceeded, and during the first five years of the 21st century, the EV market began a slow, steady period of growth. The second five years saw widespread use of HEVs, the commercial production of pure battery-powered EVs in many niche markets, wide adoption of battery-powered scooters, and commercial-scale demonstrations of fuel cell vehicles.
Soon it was determined that HEVs could be turned into plug-ins that could be recharged by both the vehicle’s internal combustion engine as well as a battery charger plugged into utility electric power. Of course, the original approach to the plug-in was a pure EV that had no internal combustion engine at all, just a motor and battery bank. But this new approach resulted in an entirely new class of vehicle: the plug-in hybrid electric vehicle or PHEV that had many of the advantages of both battery power and internal combustion power.
In addition to pure EV automobiles, there are also growing niche markets for trucks, buses, smaller electric scooters or Segway-type vehicles. A whole new market for low velocity or neighborhood electric vehicles has developed, which includes General Motors’ (GM) Electric Networked-Vehicle (EN-V).
HEVs, PHEVs, and pure EVs can all be powered by electrochemical batteries and fuel cells, as well as potentially by capacitors and flywheels. Plug-in EVs can charge up, using electrical power generated during nighttime off-peak periods. In the early 1990s, this approach (known as peak shifting or load leveling) was seen as the optimal solution to electric utilities’ load-leveling dilemma. Since then, automakers have been reluctant to manufacture and market nonhybrid EVs. By the late 1990s, partially because of the introduction of advanced chargers, consumers began to switch to quick-charge approaches. Starting in California, and now throughout the US, Japan and Europe, networks of conveniently located charging stations have been implemented.
Going forward, EV battery charger implementations will be a mixture of charging stations, home charging units and chargers actually built into a vehicle.
Smart Battery Safety: Lithium metal containing batteries, especially primary batteries such as lithium thionyl chloride have long been safety concerns because of the possibility of rapid or even uncontrolled discharge, rupture or burning. Their transport by air is restricted. For quite a while, lithium-ion smart batteries were seen as safer and they are of course widely used in cell phones, laptop computers and multi-functional handhelds: all the portable products that are essential, or even critical to modern business people and the public at large.
Unfortunately, starting in 2006, high-capacity lithium-ion laptop batteries began overheating, catching fire and reportedly even exploding. In several cases, this happened in or near airplanes, although fortunately there have not been serious incidents in aircraft in flight. This puts airlines in a very difficult position. An in-flight fire or even a small explosion is unacceptable on every level. On the other hand, struggling airlines cannot afford to cripple their cash cow, business travelers, by forbidding the use or possession of lithium battery containing products. Note that this is not a situation where airlines could just require battery-containing products to be checked as baggage. A lithium battery fire in a cargo hold is potentially more dangerous than a similar fire in a cabin.
This ultimately led to airlines and flight regulatory agencies like the FAA to prohibit lithium batteries in checked baggage and restrict the carry-on of spare lithium batteries. Large lithium-ion batteries (more than 25 grams equivalent lithium content) can’t be carried on commercial flights at all. Further restrictions greatly curtailed and in many cases eliminated shipping lithium batteries as cargo.
In some countries lithium batteries can’t be mailed either. For instance, Japan, Hong Kong and Australia restrict mailing both lithium batteries and lithium battery-containing products because of their likely transport as airmail. Other countries are considering similar restrictions.
More recently, larger lithium-ion smart batteries used in EVs have been implicated with fires. In many cases, the problem apparently is metal particle contamination. Although a detailed failure mode analysis has not been released, the particles apparently either led to dendrite growth that ruptured battery separators, or perhaps in some cases the particles ruptured the membranes directly. Remember that a lithium-ion laptop battery polyethylene or polypropylene membrane separator is just a few microns thick (sometimes as few as 20 microns). The ruptured membrane can lead to spontaneous discharge, overheating or both and can eventually result in combustion. Shorting out external connectors (plug-ins) could have caused the overheating.
There are a number of alternative lithium smart battery (or even alternative battery chemistries), battery charger and portable product designs that could reduce or eliminate the problem.
The Global Market: Battery chargers currently represent the largest of the three battery control technology market sectors, with 2011 sales of about $48 billion. They are followed by smart batteries (including both nickel metal hydride and lithium-ion), especially those used in portable products and on-road electric vehicles. Smart batteries represent a 2011 $32 billion market expected to grow to more than $49 billion by 2016. Meanwhile although battery conditioner shipments have grown over the last five years, the value of these shipments is actually falling because of falling per-unit price. This situation should reverse before 2016, as lower prices and expanding markets create increased demand and growing shipments and sales. Between 2011 and 2016, global sales are predicted to grow from $5.2 to $5.8 billion.
The automotive battery charger market is one of the oldest and best established battery control technology market sectors. Worldwide sales are about 140 million units annually. Despite intense research and several promising prototypes, smart automotive batteries, which would have been high voltage, have not been commercialized.
Traction battery-powered vehicles and associated battery control technology, are widely used but are beginning to compete with both more efficient, cleaner internal combustion engines and alternative power such as natural gas power and fuel cell power. The global annual battery control market is worth almost $2.7 billion, but the five-year CAGR will be only about 0.5 percent.
The stationary power market includes uninterruptible power supplies (UPS), emergency power and remote power. Sales over the last five years have been relatively flat as consumers (mainly commercial and industrial and including telecommunications and Internet providers) react to the overall economic climate. While number of units shipped has increased, sharp discounting has meant relatively lower growth in value of shipments. Based on a consensus scenario this annual value of shipments should grow from $816 million to $969 million between 2011 and 2016. During that period the industry will face increased competition from non-battery power management technologies like fuel cells.
The most dynamic, highest growth sector in the battery control market is for on-road electric vehicle chargers and smart batteries. Hybrid electric vehicles, pure battery powered vehicles and plug in hybrid vehicles will be seen in increasing numbers, partially because of government subsidies, partially because of fuel economy and partially because of a growing commitment to environmental responsibility. Currently, most on-road EVs are scooters used mainly in the Far East, especially China. These require battery chargers but do not generally use smart batteries. Most passenger car EVs are hybrid electric vehicles with nickel metal hydride smart batteries. Going forward, more pure battery powered EVs will be on the road and they will require on-board, home, and public charger station types of battery chargers. The type of smart battery used will evolve from nickel metal hydride to lithium-ion. The overall global battery control market will grow from more than $5 billion in 2011 to more than $18 billion by 2016.
On the other hand, the portable product battery control market is both large and growing. On the strength of popular multi-functional handheld devices and tablet computers (as well as old standbys like laptops and cellphones) the battery control market is worth more than $69 billion and will grow to more than $93 billion by 2016. This includes large numbers of internal original equipment and external battery chargers as well as large numbers of smart batteries.
Table 1 provides a summary of historic and wholesale battery control technology sales, along with a BCC Research prediction of future global battery control sales. Detailed definitions of the markets described are available in the report. Predicted markets and compound annual growth rates (CAGRs) are expressed in constant Year 2011 dollars.
Table 2 summarizes historic and predicted consensus scenario global battery control technology sales. This historic and predicted market analysis was developed by analyzing each individual market application and summing the totals.
Donald Saxman is the editor of BCC Research’s Power Sources and Advanced Vehicle Progress newsletter, and has founded several other BCC newsletters. Mr. Saxman has more than 28 years of experience in market analysis, technical writing, and newsletter editing. Since 1983, he has operated as a technical market consultant and subcontractor to BCC Research, and, in this capacity, he has prepared more than 80 technology market research reports, including many that covered battery technology and battery markets.