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Charles W. Wessner
THE NATIONAL ACADEMIES PRESS
Copyright © National Academy of Sciences. All rights reserved.
Building the U.S. Battery Industry for Electric Drive Vehicles: Summary of a Symposium
Charles W. Wessner, Rapporteur
Subcommittee on Electric Drive Battery Research and Development Activities
Committee on Competing in the 21st Century:
Best Practice in State and Regional Innovation Initiatives
Board on Science, Technology, and Economic Policy
Policy and Global Affairs
Copyright © National Academy of Sciences. All rights reserved.
Building the U.S. Battery Industry for Electric Drive Vehicles: Summary of a Symposium
THE NATIONAL ACADEMIES PRESS 500 Fifth Street NW Washington DC 20001
NOTICE: The project that is the subject of this report was approved by the Governing Board of
the National Research Council, whose members are drawn from the councils of the National
Academy of Sciences, the National Academy of Engineering, and the Institute of Medicine. The
members of the committee responsible for the report were chosen for their special competences
and with regard for appropriate balance.
This study was supported by: Contract/Grant No. DE-DT0000584, TO# 29, between the
National Academy of Sciences and the Department of Energy. This report was prepared by
the National Academy of Sciences under award number SB134106Z0011, TO# 4 (68059)
from the U.S. Department of Commerce, National Institute of Standards and Technology
(NIST). This report was prepared by the National Academy of Sciences under award
number 99-06-07543-02 from the Economic Development Administration, U.S. Department
of Commerce. The statements, findings, conclusions, and recommendations are those of the
author(s) and do not necessarily reflect the views of the National Institute of Standards and
Technology, the Economic Development Administration, or the U.S. Department of
Commerce. Additional support was provided by the Michigan Economic Development
Corporation and Michigan’s University Research Corridor. Any opinions, findings,
conclusions, or recommendations expressed in this publication are those of the author(s) and
do not necessarily reflect the views of the organizations or agencies that provided support
for the project.
International Standard Book Number 13: 978-0-309-25452-6 (Book)
International Standard Book Number 10: 0-309-25452-3 (Book)
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Fifth Street, N.W., Keck 360, Washington, DC 20001; (800) 624-6242 or (202) 334-3313;
http://www.nap.edu/.
Copyright 2012 by the National Academy of Sciences. All rights reserved.
Printed in the United States of America
Copyright © National Academy of Sciences. All rights reserved.
Building the U.S. Battery Industry for Electric Drive Vehicles: Summary of a Symposium
The National Academy of Sciences is a private, nonprofit, self-perpetuating society of
distinguished scholars engaged in scientific and engineering research, dedicated to the
furtherance of science and technology and to their use for the general welfare. Upon the
authority of the charter granted to it by the Congress in 1863, the Academy has a mandate
that requires it to advise the federal government on scientific and technical matters. Dr.
Ralph J. Cicerone is president of the National Academy of Sciences.
The National Academy of Engineering was established in 1964, under the charter of the
National Academy of Sciences, as a parallel organization of outstanding engineers. It is
autonomous in its administration and in the selection of its members, sharing with the
National Academy of Sciences the responsibility for advising the federal government.
The National Academy of Engineering also sponsors engineering programs aimed at
meeting national needs, encourages education and research, and recognizes the superior
achievements of engineers. Dr. Charles M. Vest is president of the National Academy of
Engineering.
The Institute of Medicine was established in 1970 by the National Academy of Sciences
to secure the services of eminent members of appropriate professions in the examination
of policy matters pertaining to the health of the public. The Institute acts under the
responsibility given to the National Academy of Sciences by its congressional charter to
be an adviser to the federal government and, upon its own initiative, to identify issues of
medical care, research, and education. Dr. Harvey V. Fineberg is president of the
Institute of Medicine.
The National Research Council was organized by the National Academy of Sciences in
1916 to associate the broad community of science and technology with the Academy’s
purposes of furthering knowledge and advising the federal government. Functioning in
accordance with general policies determined by the Academy, the Council has become
the principal operating agency of both the National Academy of Sciences and the
National Academy of Engineering in providing services to the government, the public,
and the scientific and engineering communities. The Council is administered jointly by
both Academies and the Institute of Medicine. Dr. Ralph J. Cicerone and Dr. Charles M.
Vest are chair and vice chair, respectively, of the National Research Council.
www.national-academies.org
Copyright © National Academy of Sciences. All rights reserved.
Building the U.S. Battery Industry for Electric Drive Vehicles: Summary of a Symposium
Copyright © National Academy of Sciences. All rights reserved.
Building the U.S. Battery Industry for Electric Drive Vehicles: Summary of a Symposium
v
Subcommittee on
Electric Drive Battery Research and Development Activities
Mary L. Good (NAE), Chair
Dean Emeritus, Donaghey College
of Engineering and Information
Technology
Special Advisor to the Chancellor
for Economic Development
University of Arkansas
at Little Rock
Raymond G. Boeman
Director, Energy Partnerships
Oak Ridge National Laboratory
Michael G. Borrus
Founding General Partner
X/Seed Capital Management
Ralph Brodd
President
Broddarp of Nevada
Robert Kruse
Principal
EV Consulting
W. Clark McFadden II
Senior Counsel
Orrick, Herrington & Sutcliffe LLP
Daniel Sperling
Director, Institute
of Transportation Studies
University of California, Davis
Committee on Competing in the 21st Century:
Best Practice in State and Regional Innovation Initiatives
Mary L. Good (NAE), Chair
Dean Emeritus, Donaghey College
of Engineering and Information
Technology
Special Advisor to the Chancellor
for Economic Development
University of Arkansas
at Little Rock
Michael G. Borrus
Founding General Partner
X/Seed Capital Management
William C. Harris
President and CEO
Science Foundation Arizona
W. Clark McFadden II
Senior Counsel
Orrick, Herrington & Sutcliffe LLP
David T. Morgenthaler
Founding Partner
Morgenthaler Ventures
Edward E. Penhoet (IOM)
Director
Alta Partners
Tyrone C. Taylor
President
Capitol Advisors
on Technology, LLC
Copyright © National Academy of Sciences. All rights reserved.
Building the U.S. Battery Industry for Electric Drive Vehicles: Summary of a Symposium
vi
PROJECT STAFF
Charles W. Wessner
Study Director
McAlister T. Clabaugh
Program Officer
David S. Dawson
Senior Program Assistant
Sujai J. Shivakumar
Senior Program Officer
David E. Dierksheide
Program Officer
Peter Engardio
Consultant
Copyright © National Academy of Sciences. All rights reserved.
Building the U.S. Battery Industry for Electric Drive Vehicles: Summary of a Symposium
vii
For the National Research Council (NRC), this project was overseen by
the Board on Science, Technology and Economic Policy (STEP), a standing
board of the NRC established by the National Academies of Sciences and
Engineering and the Institute of Medicine in 1991. The mandate of the Board
on Science, Technology, and Economic Policy is to advise federal, state, and
local governments and inform the public about economic and related public
policies to promote the creation, diffusion, and application of new scientific and
technical knowledge to enhance the productivity and competitiveness of the U.S.
economy and foster economic prosperity for all Americans. The STEP Board
and its committees marshal research and the expertise of scholars, industrial
managers, investors, and former public officials in a wide range of policy areas
that affect the speed and direction of scientific and technological change and
their contributions to the growth of the U.S. and global economies. Results are
communicated through reports, conferences, workshops, briefings, and
electronic media subject to the procedures of the National Academies to ensure
their authoritativeness, independence, and objectivity. The members of the
STEP Board* and the NRC staff are listed below:
Paul L. Joskow, Chair
President
Alfred P. Sloan Foundation
Ernst R. Berndt
Louis E. Seley Professor
in Applied Economics
Massachusetts Institute
of Technology
John Donovan
Chief Technology Officer
AT&T Inc.
Alan M. Garber (IOM)
Provost
Harvard University
Ralph E. Gomory (NAS/NAE)
Research Professor
Stern School of Business
New York University
*As of September 2012.
Mary L. Good (NAE)
Dean Emeritus, Donaghey College
of Engineering and Information
Technology
Special Advisor to the Chancellor
for Economic Development
University of Arkansas
at Little Rock
William H. Janeway
Partner
Warburg Pincus, LLC
Richard K. Lester
Japan Steel Industry Professor
Head, Nuclear Science
and Engineering
Founding Director, Industrial
Performance Center
Massachusetts Institute
of Technology
continued
Copyright © National Academy of Sciences. All rights reserved.
Building the U.S. Battery Industry for Electric Drive Vehicles: Summary of a Symposium
viii
William F. Meehan III
Lecturer in Strategic Management
Raccoon Partners Lecturer
in Management
Graduate School of Business
Stanford University
and
Director Emeritus
McKinsey and Co., Inc.
David T. Morgenthaler
Founding Partner
Morgenthaler Ventures
Luis M. Proenza
President
The University of Akron
William J. Raduchel
Chairman
Opera Software ASA
Kathryn L. Shaw
Ernest C. Arbuckle Professor
of Economics
Graduate School of Business
Stanford University
Laura D’Andrea Tyson
S.K. and Angela Chan Professor
of Global Management
Haas School of Business
University of California, Berkeley
Harold R. Varian
Chief Economist
Google, Inc.
Alan Wm. Wolff
Senior Counsel
McKenna Long & Aldridge LLP
STEP Staff
Stephen A. Merrill
Executive Director
Paul T. Beaton
Program Officer
McAlister T. Clabaugh
Program Officer
Aqila A. Coulthurst
Program Coordinator
Charles W. Wessner
Program Director
David S. Dawson
Senior Program Assistant
David E. Dierksheide
Program Officer
Sujai J. Shivakumar
Senior Program Officer
Copyright © National Academy of Sciences. All rights reserved.
Building the U.S. Battery Industry for Electric Drive Vehicles: Summary of a Symposium
ix
Contents
PREFACE xiii
I. OVERVIEW 1
II. PROCEEDINGS 45
DAY ONE
Welcome 47
Greg Main, Michigan Economic Development Corporation
Opening Remarks I 48
Carl Levin, United States Senate
Opening Remarks II
Introduction by Charles W. Wessner, The National Academies 51
Sridhar Kota, White House Office of Science and Technology Policy 52
Opening Remarks III 56
Jennifer Granholm, State of Michigan
Overview of NAS Study: Building the Battery Industry
for Electric Vehicles 59
Mary Good, University of Arkansas at Little Rock
Keynote Address
Introduction by John R. Chalifoux, Original Equipment Suppliers 62
Association
Debbie Stabenow, United States Senate 63
Panel I: The Federal Outlook for the U.S. Battery Industry 70
Moderator: Charles W. Wessner, The National Academies
The Department of Energy Perspective 70
Patrick B. Davis, U.S. Department of Energy
Vehicle Technologies Program
Copyright © National Academy of Sciences. All rights reserved.
Building the U.S. Battery Industry for Electric Drive Vehicles: Summary of a Symposium
x CONTENTS
The Army Perspectives 76
Grace Bochenek, U.S. Army Tank Automotive
Research, Development and Engineering Center
John Pellegrino, U.S. Army Research Laboratory
Panel II: The State of Battery R&D and Manufacturing
in the United States 84
Moderator: Ralph C. Brodd, Kentucky-Argonne National Battery
Manufacturing R&D Center
The Battery Industry Perspective 84
Jason M. Forcier, A123 Systems
Mohamed Alamgir, Compact Power
The Automotive Industry Perspective 92
Nancy Gioia, Ford Motor Company
The University/Startup Perspective 99
Ann Marie Sastry, University of Michigan and Sakti3
Panel III: Strengthening the Supply Chain 103
Moderator: Jim Greenberger, National Alliance
for Advanced Technology Batteries
Battery Manufacturer Perspective 104
Tom Watson, Johnson Controls
Defining the Supply Chain: Gaps and Opportunities 107
Michael E. Reed, Magna E-Car Systems
Battery Materials Availability and Recycling 110
Linda Gaines, Argonne National Laboratory
Panel IV: Market Drivers: 117
Creating Demand for Electric Vehicles
Moderator: Robert Kruse, EV Consulting LLC
Incentives for the Electric Vehicle Market 118
Daniel Sperling, University of California-Davis
The Industry Perspective: Transforming 123
the Automotive Industry
Gary Smyth, General Motors
Copyright © National Academy of Sciences. All rights reserved.
Building the U.S. Battery Industry for Electric Drive Vehicles: Summary of a Symposium
CONTENTS xi
Early Adoption of Hybrid Vehicles 125
Bill Van Amburg, CALSTART
Panel V: Building the Battery Workforce 134
Moderator: Bill Harris, Science Foundation Arizona
Workforce Needs and Opportunities 135
Robert Kamischke, EnerDel
Technical Training and Workforce Development 138
Simon Ng, Wayne State University
DAY TWO
Welcome and Introduction 142
Andy Levin, Michigan Department of Energy, Labor
and Economic Growth
Panel VI-A: Federal and State Programs to Support 145
the Battery Industry
Moderator: Charles W. Wessner, The National Academies
The Department of Energy Battery 145
R&D Program and Goals
David Howell, U.S. Department of Energy
Department of Defense Battery 151
R&D Programs and Goals
Sonya Zanardelli, U.S. Army Tank and Automotive
Research, Development, and Engineering Center
The Kentucky-Argonne 154
National Battery Manufacturing R&D Center
Ralph C. Brodd, Kentucky-Argonne National Battery
Manufacturing R&D Center
Panel VI-B: Federal and Michigan Programs 159
to Support the Battery Industry
Moderator: Sujai Shivakumar, The National Academies
The Department of Commerce and the Role 159
of the Manufacturing Extension Partnership
David C. Stieren, Manufacturing Extension Partnership
Copyright © National Academy of Sciences. All rights reserved.
Building the U.S. Battery Industry for Electric Drive Vehicles: Summary of a Symposium
xii CONTENTS
Michigan Investments in 163
Batteries and Electric Vehicles
Eric Shreffler, Michigan Economic
Development Corporation
Roundtable: What Have We Learned and Next Steps 169
Moderator: Mary Good, University of Arkansas at Little Rock
Bill Harris, Science Foundation Arizona
Les Alexander, A123 Systems
Gary Krause, Michigan Economic Development Corporation
III. APPENDIXES
A Agenda 177
B Biographies of Speakers 181
C Participants List 205
D Bibliography 209
Copyright © National Academy of Sciences. All rights reserved.
Building the U.S. Battery Industry for Electric Drive Vehicles: Summary of a Symposium
xiii
Preface
Responding to the challenges of fostering regional growth and
employment in an increasingly competitive global economy, many U.S. states
and regions have developed programs to attract and grow high-technology
companies, develop the talent and resources necessary to create innovation
clusters, and sustain manufacturing and high value employment. These state and
regionally based initiatives have a broad range of goals and increasingly include
significant resources that often focus on driving innovation and often in
partnership with foundations and universities. These are being joined by recent
initiatives to coordinate and concentrate investments from a variety of federal
agencies that provide significant resources to develop regional centers of
innovation, business incubators, and other strategies to encourage
entrepreneurship and high-tech development.
In this regard, the state of Michigan is making significant investments
to develop an electrified-vehicle industrial cluster. The state offered more than
$1 billion in grants and tax credits to manufacturers of lithium-ion battery cells,
packs, and components. Michigan has also invested in research centers and
skilled-worker training programs for electrified vehicles.
Efforts by the federal government to ensure that the U.S. has a
domestic manufacturing base for advanced batteries are complementing
Michigan’s initiatives. The federal government in 2009 awarded $2.4 billion in
grants under the American Recovery and Reinvestment Act to manufacturers of
lithium-ion cells, battery packs, and materials.1 A host of other financial
incentives have also been introduced to help companies commercialize new
vehicle technologies, build production lines, build supply chains, and encourage
consumers to buy electric-gas hybrid cars.
To review the developments, as well as the needs and challenges, of the
U.S. electric drive battery industry in Michigan, the National Academies Board
on Science, Technology, and Economic Policy (STEP), in cooperation with the
Michigan Economic Development Corporation and the Department of Energy,
convened a symposium, on Building the U.S. Battery Industry for Electric Drive
Vehicles: Progress, Challenges, and Opportunities.
The symposium, held on 26-27 July 2010 in Livonia, Michigan, and
this report of that symposium, address the first of two key elements of the
Statement of Task (described below) of a committee of the National Research
Council.
1
The American Recovery and Reinvestment Act of 2009 (P. L. 115-5) is a $787 billion economic
stimulus packaged signed by President Barack Obama on Feb. 17, 2009. See Department of Energy,
“The Recovery Act: Transforming America’s Transportation Sector—Batteries and Electric
Vehicles,” July 14, 2010 (http://www.whitehouse.gov/files/documents/Battery-and-Electric-VehicleReport-FINAL.pdf)
Copyright © National Academy of Sciences. All rights reserved.
Building the U.S. Battery Industry for Electric Drive Vehicles: Summary of a Symposium
xiv PREFACE
STATEMENT OF TASK
The Overall Project
An ad hoc subcommittee will plan and conduct two public symposia to
review and analyze the potential contributions of public-private partnerships and
identify other relevant issues for the Department of Energy, Office of Vehicle
Technologies, Energy Storage Team's activities in the energy storage research
and development area. The symposia will also identify lessons from these and
other domestic and international experiences to help inform DoE as to whether
its activities are complete and appropriately focused. Additional topics that
emerge in the course of the planning may also be addressed. The two symposia
will gather representatives from leading battery manufacturers, automotive
firms, university researchers, academic and industry analysts, congressional
staff, and federal agency representatives. An individually-authored summary of
each symposium will be issued.
This Report
The symposium that is the subject of this report was held in Michigan
in order to provide direct access to the policymakers and industrial participants
drawn from the concentration of battery manufacturers and automotive firms in
the region. The symposium reviewed the current state, needs, and challenges of
the U.S. advanced battery manufacturing industry; challenges and opportunities
in battery R&D, commercialization, and deployment; collaborations between the
automotive industry and battery industry; workforce issues, and supply chain
development. It also focused on the impact of DoE's investments and the role of
state and federal programs in support of this growing industry. This task of this
report is to summarize the presentations and discussions that took place at this
symposium. Needless to say, the battery industry has evolved very substantially
since the conference was held, and indeed some of the caveats raised by the
speakers with regard to overall demand for batteries and the prospects of
multiple producers now seem prescient. At the same time, it is important to
understand that it is unrealistic to expect that all recipients of local, state, or
federal support in a complex and rapidly evolving industry will necessarily
succeed. A number of the firms discussed here have been absorbed by
competitors, others have gone out of business, and others continue to progress.2
2
The Overview chapter of this report takes note of these recent developments.