industry report
The National Alliance for Advanced Transportation Batteries (NAATBatt)
- Consultant - President
- Broddarp of Nevada Inc.
The National Alliance for Advanced Transportation Batteries (NAATBatt) started from a concept developed by James Greenberger as a result of a presentation by Ralph Brodd at the ACG meeting in Chicago in June 2008 based on the ATP Working Paper, WP-5 "Factors Affecting U.S. Production Decisions: Why There are No Volume Lithium Ion (Li-Ion) Battery Manufacturers in the U.S."
In October 2008, Greenberger enlisted four other people, Jeff Chamberlain, Carlos Helou, Sanford Kane and Ralph Brodd to assist in developing his concept for a not-for-profit cooperative or consortium for the manufacture of Li-Ion batteries in the U.S. The group incorporated in January 2009 and now has more than 50 member companies ranging from large lead acid battery companies, materials producers and pack assemblers to small venture capital start-ups. NAATBatt is dedicated to help assure that the U.S. achieves energy independence.
The NAATBatt follows the model of SEMATECH, which successfully helped restore semiconductor technology leadership to the U.S. SEMATECH was, and is, a public-private partnership which includes most of the largest U.S. semiconductor companies receiving about $500 million in grant funding from the federal government. SEMATECH served as a catalyst in reversing the erosion of the US semiconductor market. NAATBatt intends to be the catalyst for the battery industry in the same way that SEMATECH was for the semiconductor industry. If U.S. firms lose control of the manufacturing process technology that underlies Li-Ion cells, the long-term erosion of U.S. manufacturing jobs in the automotive sector and energy independence will be just as inevitable as was the loss of jobs in the computer industry prior to SEMATECH. NAATBatt intends to ensure that at least some of that manufacturing process technology remains in U.S. hands.
Japan, South Korea and China, whose governments are the centers for the manufacture of Li-Ion battery cells, have heavily subsidized their Li-Ion industries. Those governments have understood that in the quickly changing automobile industry, he who makes the Li-Ion batteries will one day make the cars. Without government support, U.S. companies have been unable or unwilling to build Li-Ion factories in the United States. The low-cost production of Li-Ion cells requires a large, automated factory capable of producing 3 million cells per month or so in order to be competitive in the world market. Previously, no U.S. company has been willing to invest the hundreds of millions of dollars necessary to build and operate such a factory. U.S. companies in the Li-Ion business have outsourced manufacturing to Asia or partnered with foreign companies and imported their cells.
Li-Ion battery technology was first commercialized by Sony in 1991 and is still in its infancy compared to the rechargeable lead-acid, nickel-cadmium and nickel-hydride battery systems. While U.S. scientists have made significant progress in increasing power and energy densities of Li-Ion cells, more powerful, longer lasting, lighter and safer Li-Ion cells must be developed and commercialized to meet the President's goal of putting one million plug-in hybrid electric vehicles (PHEV's) on the road in 2015. NAATBatt intends to help ensure that U.S. industry can do just that.
NAATBatt intends to take advantage of the funding opportunity offered by the U.S. Department of Energy (DOE) under the DE-FOA-0000026 grant program to establish an advanced battery manufacturing facility. NAATBatt will help revitalize the U.S. battery industry by building a one million square foot, fully automated Li-Ion battery cell manufacturing facility in Glendale, Kentucky with a potential investment in excess of $600 million for the first-of-its-kind manufacturing facility for Li-Ion battery cells. NAATBatt will contract to manufacture Li-Ion battery cells for U.S. companies (Alliance members have priority) to their proprietary specifications. Effectively, NAATBatt will bring back Li-Ion battery cell manufacturing business to the U.S. that would otherwise have gone offshore.
NAATBatt will benefit the entire U.S. battery industry, not just to one company or one region. Although the NAATBatt manufacturing facility will be located in Kentucky, it will serve the needs of battery companies throughout the U.S. NAATBatt members have employees and facilities in all 50 states. They range from some of the oldest and largest lead acid battery manufacturers in the U.S. to West Coast start-ups working with cutting edge Li-Ion technology. NAATBatt members know that it is impossible to say who the winning companies in the Li-Ion battery race will be or where they will be located. But wherever the winners are located, NAATBatt will be a resource for them and will help them get their products to market at the lowest possible cost.
NAATBatt will operate as a not-for-profit business cooperative. As a cooperative, NAATBatt members will have their battery cells made and sold to them by NAATBatt at cost. Members benefit by ensuring that NAATBatt runs as efficiently as possible so as to keep their own cell prices as low as possible. NAATBatt's structure will keep the costs of Li-Ion battery cells and the PHEVs that use them at a competitive level.
NAATBatt is uniquely positioned to ensure lower Li-Ion cell cost through developing more efficient manufacturing processes as well as automating and perfecting the new processes for cell assembly, a key factor in bringing costs down. Asian battery companies have built their lead over American companies in large part because of their lead in manufacturing process technology. NAATBatt plans to change that.
NAATBatt will operate as a contract manufacturer only. NAATBatt members will be the sales arm so NAATBatt is free to focus solely and exclusively on the issue of perfecting and lowering the cost of the manufacturing process technology for Li-Ion battery cells. Thereby, NAATBatt believes that it can eventually beat its Asian competitors at their own game. Its alliance with the Kentucky-Argonne Advanced Battery R&D Center will permit NAATBatt to benefit directly from cutting edge research and development work that the Center will be doing for materials and manufacturing process technology.
The end result will enable NAATBatt to create sustainable U.S. manufacturing jobs. The reason for this requirement lies in the experience of the semiconductor industry in the 1980s. At that time, certain Asian countries were beginning to dominate semiconductor manufacture. At first, such domination of one discrete component was thought innocuous. But U.S. companies came to realize that components were the lynchpin of the computer hardware industry and that foreign manufacturers and foreign governments were using dominance of semiconductors as leverage to capture control of the entire industry.
The Li-Ion cell is to the automobile what the semiconductor was to the computer. Foreign-owned companies can, in the short term, create as many manufacturing jobs as NAATBatt, dollar for dollar, by building plants in the U.S. But those jobs will not be sustainable. NAATBatt is not a Buy American initiative. It is simple common sense based on actual industry experience. The U.S. taxpayer should not subsidize foreign companies' purchases of U.S. battery market share and acquisition of fundamental, strategic, job-creating technology. Fundamental to this concept is that NAATBatt will be a national asset operated to address a critical need of the U.S. battery industry as well as long-term, for the economic benefit for the U.S. During the expected 10-year period of operation (which can be extended at the option of the Department of Energy), any profits from NAATBatt operations will either be reinvested in the manufacturing facility or rebated to NAATBatt members in the form of reduced cell prices. Rebates on cell prices will be governed by a policy that will be compliant with the requirements of Subchapter T of the Internal Revenue Code.
As part of its funding agreement, NAATBatt will give the DOE the contractual right, exercisable anytime after the tenth year of NAATBatt's operations, to sell NAATBatt to a third party or otherwise monetize the interests of NAATBatt's government stakeholders, subject to DOE approval. If NAATBatt is successful in building a world-class manufacturing facility for Li-Ion cells and developing leading edge manufacturing process technology, it is reasonable to expect that the proceeds of the sale will substantially exceed the original grants and incentives made available to NAATBatt. Our mission is to establish the U.S. as the world-class manufacturing technology leader in Li-Ion battery cells for transportation applications.
NAATBatt Objectives
1. To catalyze the development of a sustainable, electrified vehicle powertrain industry in the U.S. in which battery energy storage is the key enabling technology.
2. NAATBatt will focus on establishing a high volume cell manufacturing facility to service both the automotive/truck and military vehicle customers of NAATBatt members.
3. The process and manufacturing technology developed by NAATBatt will enable high volume production of cell design(s) consistent with battery system integration requirements for powertrain applications.
4. In conjunction with the anchor manufacturing facility, NAATBatt will actively contribute to establish Centers of Excellence for materials and process improvement. These Centers of Excellence will utilize appropriate national laboratories as the "hub" combined with key academic institutions and supply chain participants from materials to manufacturing equipment.
5. NAATBatt membership structure includes cell/battery developers and supply chain and equipment manufacturers, government units and agencies as well as academic institutions
NAATBatt Members
NAATBatt's members include ActaCell, Airgas, Altair Nanotechnologies, American Operations Corp., BASF, Battery Council International, Bosch, Boston Power, BST Systems, Cabot, C&D Technologies Inc., Celgard, CFX Battery Inc., CH2MHill, ConocoPhillips Specialty Products Inc., Eagle Picher, East Penn Manufacturing Co. Inc., Edgewater Automation, Extrusion Dies Industries LLC, EnerSys, Envia Systems, Erachem Comilog Inc., Exide Technologies, FMC Corp., Gaia Akku, Hammond Group Inc., Innovative Machine Corp, International Battery Inc., KEMET Corp., Lester Electrical, Lithium Force, Megtec, MicroSun Technologies, Mobius Power, Molecular Nanosystems, Nanotek Instruments Inc., Procter & Gamble, Porous Power Technologies, Ricardo Inc., Rockwood Holdings Inc., The Shepherd Chemical Co., SiLyte, Superior Graphite, TIMCAL Ltd., Toda America Inc., and Yardney Lithion.
For more information, visit
www.naatbatt.org.
