The Promise of QuantumScape // First Principles Advantages

The Promise of QuantumScape // First Principles Advantages

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Welcome back everyone! I’m Jordan  Giesige and this is The Limiting Factor.  This is the third of three videos on QuantumScape  – the good, the bad, and the ugly. The last two   videos covered the bad and the ugly. I covered  these first to clear the air so that we can   appreciate the promise of QuantumScape’s  technology. That is, today we’re gonna  

look at the good, which is the first principles  benefits of solid state lithium metal batteries.  Before we begin, a special thanks to my  Patreon supporters and YouTube members.   This is the support that gives me the freedom  to avoid chasing the algorithm and sponsors,   and I hope will eventually allow me to do this  full time. As always, the links for support are  

in the description. Back to QuantumScape. Let’s start with why Solid State batteries   are considered the holy grail of batteries.  We first need to define what type of solid   state battery we’re referring to, because  there are a few different flavours. The   specific type of solid state battery that we’ll  discuss here is what’s called an anode-less   solid state battery. What do these words mean? Solid state is straightforward. In a conventional  

liquid electrolyte battery cell, the lithium ions  travel back and forth between the cathode and   anode through a liquid. In a solid state battery,  the liquid electrolyte is replaced with a solid.   This offers greater safety because liquid  electrolytes are typically flammable.  Next, what’s anode-less mean? A conventional  lithium ion battery uses copper coated with   graphite for the anode. The graphite is a stable  host structure that’s used to store lithium   at 1 lithium atom for each 6 carbon atoms. With an anode-less battery cell, the anode   is just copper with no coating. When the  battery charges, lithium plates directly  

to the copper as lithium metal. This is the most  energy dense way to store lithium metal at the   anode because no bulky host structure is required. In other words, anode-less solid state batteries   are actually one hell of an innovation because  they replace two pieces of the core technology   in a conventional lithium ion battery – the anode  and the electrolyte. Doing just anode-less or   just solid state are each, in their own right,  quite a feat. Doing both at the same adds to  

the difficulty but it’s also why some people call  solid state batteries the holy grail of batteries:   It maximises both energy density and safety  at the same time, two requirements which   are usually mutually exclusive of each other. QuantumScape claims to have mastered anode-less   and solid state simultaneously, and they’re  claiming they’ve achieved excellent performance in   every test dimension at low cost. Whether they can  deliver on that claim with a commercial product   remains to be seen, but for this video let’s  assume they can and explore the technology. 

Let’s look at QuantumScape’s Specs compared  to what we might expect from Tesla in 2024,   when QuantumScape is expecting to enter into low  volume production. QuantumScape is projecting   a pack level energy density of 228 Watt  hours per kilogram assuming a 353 mile range.   With some back of the napkin calculations  QuantumScape is looking at a cell level energy   density of around 350 watt hours per kilogram when  their cells go into low volume production in 2024.  This is excellent compared to today’s liquid  electrolyte battery cells, which are around 260   to 300 watt hours per kilogram. 350 watt  hours per kilogram is similar to what I  

expect Tesla to be producing in 2024, and  I expect Tesla to be leading the market.  It’s worth noting that at  350 watt hours per kilogram,   QuantumScape will be just beginning to mine the  energy density potential of their battery cells   and over time their battery cells  should exceed far beyond 400 watt   hours per kilogram. I expect the energy density  of Tesla’s liquid electrolyte cells to max out   at around 400 watt hours per kilogram based on the  potential energy density improvements I see today. 

Anode-less solid state batteries are able to  achieve higher energy densities because they   don’t have material coating the anode and  they have slightly higher voltage potential   than graphite or silicon. The issue instead  tends to be cost, which we’ll cover later.  By 2030, if Tesla wants to keep an edge in energy  density, they would need either a better cathode,   anode-less with a liquid electrolyte, or their  own version of solid-state. The question is,   will Tesla need greater than  400 watt hours per kilogram?   In my view, only if they create an electric  VTOL. Otherwise, cost will be the key metric.  Next, charge rate. QuantumScape expects their  batteries to be able to charge from 0-80%   in 15 minutes. This excellent compared to  today’s liquid electrolyte battery cells.   Once again, I’m expecting similar performance  from Tesla’s battery cells in 2024, but his all   depends on how much Silicon Tesla can fit in their  battery cells without causing cycle life issues. 

In terms of cycle life how does QuantumScape  perform? For a Nickel based cathode chemistry,   800 cycles would be a minimum target because for  a battery pack that provides 250 miles of range   that would be 200,000 miles over  the life of the battery pack.   Tesla’s battery cells for Nickel chemistries  are good for 1200 cycles or more,   which provides 300,000 miles over the life  of the battery pack and that will increase   over time. If we extend the lines from  QuantumScape’s test data, 1200 cycles is   achievable. This looks promising but we really  need real world cycle life data to prove it out.  What all this means is that in terms of  performance, QuantumScape expects to match   the performance of high end conventional battery  cells in the mid-2020’s. In 2030 and beyond,  

the first principles advantages of solid state  batteries should come into play and establish a   firm advantage in energy density for QuantumScape.  But, energy density, charging speed, and cycle   life aren’t the only factors to consider. The  number one priority for auto OEMs is cost.  QuantumScape is indicating that in 2028, they’ll  be producing 91 Gigawatt hours with six and a half   billion in revenue. This means they’re expecting  to sell their battery cells at $70 per kilowatt   hour at the cell level. QuantumScape  is also claiming a 30% gross margin,  

which would put their cell production cost  at $50 per kilowatt hour. Hold that thought.  By 2028, at the cell level, Tesla may be able to  achieve less than $30 per kilowatt hour with LFP   and $35 per kilowatt hour for high nickel  chemistries. That’s a finger in the wind estimate,   but certainly doable. This is because Tesla’s  vertically integrating most of the supply chain   and won’t need to pay sales taxes, logistics  fees, or a profit margin to third parties.  As for the price of cells in the broader battery  market, the average price in 2020 was $102   per kilowatt hour. Over the past 30 years,  lithium ion cell prices have dropped by 19%   for each doubling of production capacity.  If battery cell production grows at 50%  

per year that means a cost reduction  of 7.5% per year, or $59 kWh in 2028.  That is, it looks like QuantumScape plans  to sell their battery cells for a premium   compared to a conservative forecast for  conventional lithium ion battery cells in 2028.  If their battery cells do end up having an  edge in charging speed or energy density,   auto OEMs may be willing to pay that premium.  But, in my view, there needs to be something   else to sweeten the pot. QuantumScape  will have to provide other benefits that   liquid electrolyte battery cells can’t. Luckily, they appear to have at least 5: 

First, if the data provided in QuantumScape’s  presentation doesn’t contain any fish hooks, they   should have better low temperature performance  than current lithium ion batteries. This is   because liquid electrolytes begin to freeze up at  low temperatures, whereas a solid-electrolytes are   already frozen. There are solid electrolytes  that perform poorly at low temperatures, but   QuantumScape is using an electrolyte that should  exhibit good high and low temperature performance.  The majority of vehicle owners don’t have a  gripe about cold weather performance, but again,   we’re talking niche benefits that a small group  of people are willing to pay a premium for.   And, as far as niches go, this’ll be a  big one. Cold weather performance is one  

of my most frequently asked questions. Second, high temperature performance.   Liquid electrolytes tend to start degrading  at high temperatures and become explosive.   Solid electrolytes actually perform better at  high temperatures, which softens up the solid   materials in a solid state battery, allowing  better contact between the solid layers,   which increases charge and discharge rates. This thermophilic nature means QuantumScape’s   batteries might last longer in hot climates.  But, it’s dependent on how temperature tolerant  

QuantumScape’s cathode gel is. The cathode gel  isn’t solid state, and if it isn’t stable at   higher temperatures, it may reduce the safety  benefits and high temperature performance.  I note that QuantumScape’s high temperature  slide didn’t appear to include the cathode,   and only tested the lithium anode against the  electrolyte. That is, it doesn’t appear to be  

a full battery cell, which would have given us  an idea of the performance of the cathode gel.  Third, with better high and low temperature  tolerance, solid state batteries require less   thermal management. This allows simplification  and weight reductions at the pack level.  Fourth, liquid electrolytes are flammable.  This means when the battery gets too   hot or when the battery shorts out, it can  burst into flames. In a solid state battery,  

the electrolyte isn’t flammable, which  is why solid-state batteries are safer.  Fifth, because solid state batteries are  safer, they might allow for the use of less   packaging and therefore weight. This, combined  with reduced thermal management requirements means   that at the pack level, solid state batteries  should reduce costs and increase energy density.  Now that we’ve looked at the major  specs, cost, and fringe benefits,   how do we interpret the market for QuantumScape’s  battery cells? Here’s how I think it’ll play   out. Tesla’s 4680 battery cells, along with  battery cells from China, will dominate the   2020s due to their lower cost vs solid state. However, if QuantumScape can deliver on the   benefits of solid-state, they should be able to  find a niche that’ll give them a foothold in the   market. From there, they can expand on that niche  as volume drives down production costs and the  

first principles manufacturing benefits of solid  state begin to play out, eventually driving the   cost of their batteries below the cost of  liquid electrolyte batteries in the 2030s.  In other words, the first principles manufacturing  benefits are where I think QuantumScape’s great   long term potential lies. What are those  first principles manufacturing benefits?  First, as I said earlier, anode-less solid  state batteries have the potential for higher   energy densities because they’re able to  completely eliminate graphite and silicon   coatings on the copper current collector of  a battery cell. This also means that during   manufacturing, the entire coating process  for the anode can be eliminated, meaning   the chunk of capital to buy those machines and  the floor space to house them can be eliminated.  Next, because no electrolyte filling is required,  further money and floor space is saved. Instead,  

the electrolyte is just a ceramic sheet. After  the ceramic sheets are shuffled into the other   layers of the battery cell, the battery cell is  capped and it’s ready to go to formation cycling.  Formation is the stage of battery cell production  where the battery is charged and discharged over   the course of several few hours to finish the  production process. After formation, the cell is   aged for around two weeks, giving the cell time to  exhibit defects before final testing. This means  

millions of battery cells are just sitting on the  shelf, not generating cash flow. All up, formation   and aging account for about 25% of the cost of a  battery factory and take up a lot of floor space,   as shown in this image. QuantumScape claims  that they’re able to mostly eliminate this step.  To understand why we need to understand formation.  In liquid electrolyte battery cells with graphite   and/or silicon at the anode, formation as the name  indicates, forms a protective layer during the   first charge and discharge cycles. This process  sacrifices expensive lithium to form a protective  

layer on the graphite anode material. With an anode-less battery cell,   there’s no material on the anode, so formation  can effectively be skipped. QuantumScape   claims that overall, these first principles  improvements to the manufacturing process will   result in a cost reduction of 17% compared to  conventional lithium ion battery manufacturing. 

What I find most encouraging here is that  QuantumScape is attacking different cost reduction   opportunities Tesla. If QuantumScape can implement  solid state technology and also implement   manufacturing technology similar to Tesla’s,  they could eventually reach a production cost   lower than what Tesla indicated at Battery Day. As I’ve said in the past, Tesla doesn’t have a   monopoly on those technologies. For  example, there are other methods of   creating a dry battery electrode that don’t  use Tesla’s hot roller technique, and therefore   wouldn’t infringe on Tesla’s patents. The counterpoint is of course that Tesla   will continue to innovate, and Battery Day is  just the beginning. In my view, Battery Day was a  

window into Tesla’s plans until 2024 and we don’t  know what Tesla has planned for the late 2020s.   2024 where the story begins for QuantumScape and I  expect it to be many years after that before they   a) implement some of the innovations we  saw at battery day and b) start moving   upstream of battery cell production into  raw materials processing to drive down cost.  With all that said, the important point here is  that an anode-less technology and solid state   technology like QuantumScape’s aren’t just an  energy density improvement. They’re manufacturing   improvements with first principles advantages  that I expect will eventually be adopted by   all major cell manufacturers in one  form or another, including Tesla. 

In the last video, I was hard on QuantumScape and  with good reason. They have big challenges ahead.   But, are there indications that QuantumScape  might actually succeed? In short, yes.  First, it sounds like QuantumScape is brute  forcing their solid state project and have run   over 2 million tests in 10 years. They didn’t  provide any information on the number of cells   those tests related to, but for comparison, Sila  Nanotechnologies tested roughly 35,000 cells over   about a decade to arrive at their chemistry. QuantumScape claims that they landed on an  

effective solid state material in 2015 and for the  past 5 years they’ve been figuring out how to make   it low cost and scalable. That is, it’s one thing  to find the right material, and it’s another to   find a recipe for that material that uses cheap  raw material inputs and a cheap manufacturing   process. I’m guessing that in the last year  or two they were able to get the numbers to   work on paper, and now it’s time to test the  recipe and manufacturing plan against reality.  This is significant because one of the primary  cost drivers in solid state batteries is the   solid state electrolyte, which usually  runs about $2000 dollars per kilogram.   For a solid state battery to be profitable,  the cost of the material per kilogram needs   to be closer to $20 per kilogram. But not only  does it need to be cheap, it needs to be thin.   If the solid electrolyte is too thick, even if  it’s cheap, it’ll blow out the cost targets. 

QuantumScape claims that they’ve found a formula  using 4 cheap bulk materials and can manufacture   a film that’s between 10-20 microns, which sounds  like a home run. We don’t know the cost of their   raw material, but if it’s available in bulk  that’s a good start. With regards to thickness,   I would have been happy to see less than  30-40 microns, so 10-20 is very promising.  Even more impressive, they’re claiming that their  solid electrolyte is as cheap as the separator   that’s currently used in liquid electrolyte  batteries to separate the cathode and the anode.   This means QuantumScape’s technology allows the  liquid electrolyte and plastic separator of a   conventional lithium ion battery to be replaced  with a solid electrolyte for the same cost. 

The next thing that usually makes solid-state  batteries expensive is that they require expensive   manufacturing techniques. QuantumScape solves  this problem by using a solid electrolyte that   comes in the form of a free standing ceramic  sheet rather than a complex coating process.   They also claim that their ceramic  sheets are robust and flexible. 

Typically, any kind of manual handling, let  alone bending, will introduce cracks into a   solid electrolyte, creating defects which cause  the battery cell to short out. I’d be curious to   know if the solid electrolyte separator in this  image was still able to be used in a battery   cell. This much bending would usually crack many  solid electrolytes, causing the cell to fail.  QuantumScape claims a cell pressure of 3.4  atmospheres. This means for the cell we see here,   they had to put it under about 200 kilograms of  pressure during testing. Solid state batteries  

usually require much higher pressures, such  as 20 versus 3.4 atmospheres. 3.4 atmospheres   should be manageable for pack engineering.  Furthermore, QuantumScape has claimed that   the battery cell performs well without pressure  and that it’s only automotive applications that   require higher performance and therefore pressure. What about the expansion of the cell as the   lithium layer plates and de-plates from the copper  current collector as the battery cell charges and   discharges? The expansion and contraction of each  cell will likely only be a few millimetres, which   again, should manageable for pack engineering. Overall, both the pressure and expansion can   be handled with proper pack design. It may  add weight to the pack, but I’d expect that   would be less weight than the solid state battery  cells themselves are saving through reduced   thermal management and safety requirements. That’s  not to say the pack engineering will be easy,  

just that the expansion and pressure  requirements aren’t a showstopper.  There are also criticisms that QuantumScape’s  battery isn’t pure solid state. While that’s true,   the question is: Does it make a difference? We  don’t know without knowing the details of the gel   electrolyte that they’ll be using at the cathode.  There are two risks that I see with using a gel. 

First, gel electrolytes typically aren’t as  robust to high temperatures as solid state,   which may reduce cycle life at high temperature  operation. Second, if the gel touches the anode,   it’ll corrode the anode, which is an  engineering challenge. If both of these   problems have been solved, then QuantumScape’s  Semi-Solid cathode may perform as well as a   pure solid state battery. I’m guessing the gel  won’t be as robust as solid state, but will be   more robust than a standard liquid electrolyte. Let’s summarise the three part video series on  

the good, the bad, and the ugly of QuantumScape. The Ugly: The Scorpion report was a self-defeating   report that took positive information out  of context and twisted it into negatives,   misinterpreted graphs and scientific data,  made suggestions that would have required a   time machine, and admitted in their disclaimer  that their informants were typically paid,   possibly biased, and the information  they provided may have been outdated.  The Bad: QuantumScape, for its part, opened  the door for the Scorpion Report by announcing   a breakthrough while not having a market ready  product, in a presentation that didn’t consider   the audience, in an overheated investing market,  and just after the Nikola and Trevor Milton saga.   It wasn’t a good look to say the least  and they made a rod for their own back.  The Good: The promise of QuantumScape is a new  type of chemistry that can fill market niches   in the late 2020s. When it eventually grows up in  the 2030s it could go from a niche product to the   primary way in which batteries are made due to  the first principles manufacturing advantages of   anode-less and solid state technology. Although  new battery factories will likely use some form  

of these technologies, will solid state batteries  replace existing liquid electrolyte battery lines?  History says no. Battery cell production  capacity from new technologies   is typically built on top of the old. This  is why we still have lead-acid batteries,   alkaline batteries, and nickel metal hydride  batteries. Once a battery technology meets  

the needs of a use case, investing  money to upgrade battery lines with   improvements that customers don’t need  or want is a misallocation of capital.  Additionally, further developments  and improvements to liquid based   chemistries will mean those production  lines will continue to be competitive   with solid state production lines for the next ten  years in terms of both energy density and cost.  Tesla fans should be rooting for QuantumScape  and every other solid state company. Why? First,   solid-state technology isn’t threat to Tesla’s  dominance because even under a best case scenario,   solid-state won’t become relevant until the end of  the decade. Second, what we saw at Battery Day was   a preview of what we can expect up to 2024, and we  should expect that Tesla will find even more ways   to extend the runway for lithium ion batteries  or develop their own version of solid state.  However, solid-state is hard, and even if Tesla  doesn’t come up with their own version, with the   multi-trillion dollar market cap Tesla might have  at the end of the decade, they could buy-out the   company that has the best version of solid state. Overall, a future that has solid state as an  

option is a much better future, so I hope that  QuantumScape does deliver. In the meantime,   there are multiple improvements to liquid  electrolyte batteries and newer chemistries   such as sodium ion and iron air. That is,  solid state isn’t the only game in town,   and we have a lot more to cover on the channel. In the next video, we’ll look at the competition   between aluminum and steel body structures  and how Tesla’s gigacasting blows the entire   cost model out of the water and  replaces it with a new reality.  If you enjoyed this video, please consider  supporting me on Patreon with the link at the   end of the video. I am also active on Twitter.  You can find the details in the description,   and I look forward to hearing from you. A special thanks to Mihec Bojc, Mark Kett, Brian  

Kinstler, Jim Dennis for your generous support of  the channel, my YouTube members, and all the other   patrons listed in the credits. I appreciate  all your support, and thanks for tuning in.

2021-09-24 07:46

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