Most people have heard of Moor’s law, the law that computing power keeps doubling every two years, with the price remaining the same, but the same law is observed with other tech products, notably lithium ion batteries and solar cells.

By my calculation the price of lithium ion batteries has fallen 98% so far, at a rate of 12.5% per year. That’s a remarkable drop given that the chemistry has hardly changed. The size has dropped too; it’s nowhere near as much as the price but enough to make batteries a reasonable choice for powering automobiles, scooters, and power tools. Batteries still lack the range and fast charging for some applications, but even there the low cost means that hybrids become attractive, combining for cars and truck, the long range of gas with a reduced cost per mile. The rate of decrease suggests that prices will be below $100 per kWh by 2025. That’s an $8000 cost for a battery powered car with 300 miles of range.

As for where the electricity comes from, the price of electricity is going up and becoming less reliable. In part that’s because of regulations on coal and nuclear power and the inherent problems with large-scale wind and solar. But decentralized solar may turn out to be a winner. Solar prices have fallen 99.6% since 1976. Even though the rate of decrease is slower, about an 8% drop in price per year, there is a sense that solar power has entered the mainstream. Combined with cheap, home batteries, it may soon make sense to power your home and car by solar cells on the house; there isn’t enough area on a car to quite power it.

Robert Buxbaum, September 27, 2021