Batteries

INDUSTRIAL CODES

NAICS: 33-5911 Storage Battery Manufacturing, 33-5912 Primary Battery Manufacturing

SIC: 3691 Storage Batteries, 3692 Primary Batteries, Dry and Wet

NAICS-Based Product Codes: 33-59111, 33-59117, 33-59112, 33-5911Y, 33-5911W, 33-59121, 33-59122, 33-59123, and 33-5912Y

PRODUCT OVERVIEW

A battery is one or a series of electrical cells or containers in which controlled chemical reactions take place. The energy generated by these reactions is captured as electromagnetic power. The atomic composition of the battery itself remains unchanged throughout its life—no elements are added or taken away—but atoms in it are rearranged. The battery has two terminals surrounded by an electrolyte. Electrolytes are, by definition, substances in which dissolved chemicals disassociate into charged ions; electrolytes are solutions of salts, acids, or bases. One terminal is made of substances that, in ionizing, build up a surplus of electrons; the other is made of a material that develops a deficiency. When a wire connects the two terminals, one yields and the other one gets electrons. Both loss and gain cause chemical reactions that kick in as soon as a circuit is established (the on-switch is pushed) but also stop when the circuit is interrupted. The electrons moving through the wire carry the energy of the chemical reactions. A device wired into the circuit (a bulb, say) captures the energy to do its job (say shine a beam).

Surpluses and deficits of electrons are possible only because the battery's internal environment is ionizing. Charged particles easily form inside it. Ions come in two varieties. Anions have more electrons than protons, cations more protons than electrons. This comes about because some part of the terminal material dissolves in the electrolyte and swims away, but by doing so it leaves part of its electrons behind and thus becomes a cation. The electrons left behind cause other atoms in the terminal to have too many; having too many, they become anions. Materials of different chemical composition have different reactivities, also called electrode potentials. Some are more and some are less easily ionized. By analogy, when a crisis erupts in social life, some people become quite hyper, others remain more steady.

In effect, for a battery to work, its terminals must have different electrical potentials. The difference is due to their different chemistries and rates of ionization. The means of naturally balancing this difference, however, must be inhibited. If not, the battery will not last long. When two terminals are suspended in an electrolyte, the electrolyte itself acts as the insulation. This inhibition is never total, one reason why batteries left lying for too long eventually lose their charge. Separators between terminals are also used to inhibit the flow of electrons. But in contrast with the electrolyte itself, a metal wire is an ideal highway for electron traffic. Atoms of copper in a wire, for example, are very loosely associated with their atomic cores. The cores are stationary but bathed in an agitated sea of electrons. In non-metals electrons are stickier; they cling to their atomic cores more firmly. For this reason a strand of silk will not conduct electricity at all but a copper wire will. When the two battery terminals are connected, the terminal with the high potential to give electrons sends them running to the terminal with a need to receive them. A current is established. For this reason batteries are sometimes called electron pumps.

The source of electrons in a battery is called the anode. It is associated with anions. Anodes are usually metals because metals easily give up their electrons, but any element similarly structured will do as well. One type of battery, for example, has a nickel-hydrogen chemistry, with hydrogen acting as the anode. Hydrogen is difficult to supply to a battery. The gas has to be kept under pressure, limiting its use to expensive stationary applications. A very popular nickel-hydrogen system, therefore, is the nickel-metal-hydride battery. It overcomes this difficulty and results in batteries one can hold in the hand. The hydrogen in such batteries is held as part of a metallic compound. Hydrogen can act as an anode because, under ionizing conditions, an atom of hydrogen is ready and willing to give up its sole electron.

The other terminal, called the cathode, is the receiver of electrons. It has a predominance of cations. Again, the cathode is usually a metal, but it must have a deficiency of electrons. Other substances meet this requirement as well if properly put together. Cathodes may be carbon. Indeed, they might be air. Air contains oxygen which, ionized, can and does act as a cathode. Some batteries use air as their cathode or, more precisely, the oxygen in the air. What matters chemically is that anodes must have too many and cathodes too few electrons.

In the standard lead acid battery familiar to us in cars, the anode is pure lead (Pb) and the cathode is lead dioxide (PbO₂). The electrolyte is a dilute solution of sulfuric acid (2H₂SO₂). As soon as a circuit is established between these two terminals, one atom of the anode, lead, transforms into lead sulfate (PbSO₄) and, in this process, gives up two electrons. At the same time one molecule of the cathode, lead dioxide, reacts with sulfuric acid to produce lead sulfate too—plus water. It gains two electrons in this reaction. Thus the electrons given up by the anode are absorbed by the cathode. The energy produced in the reaction is used by the car for starting the engine. Notice that at both terminals, one part of each has been chemically transformed into lead sulfate. The terminals have changed, if only a little. When both terminals have become lead sulfate, the energy potential in the battery has been exhausted. The electrolyte will have lost all of its sulfur and become pure water. The same atoms will still be present, but the battery will be dead.

Primary Batteries

Batteries are made of one or more electric cells. They come in two varieties. Primary cells are those that cannot be recharged. Storage cells, also called secondary cells, are those that can be charged many times. The first battery ever made was a primary cell fashioned by the Italian scientist, Alessandro Volta. Volta stacked sheets of zinc and copper plates separated by blotting paper soaked in salt-saturated water, arranging the plates so that the top and the bottom were different metals. Touching a wire to the top and the bottom of the voltaic pile produced a current in the wire, felt as heat. Two wires, one attached to the top, one to the bottom, touched to one another, produced a spark. Volta later discovered that a combination of zinc and silver plates yielded the best results. This invention, made in 1800, predated the invention of the first practical generator by about 70 years. Until the 1870s, the voltaic pile was the principal means of generating electricity for early experimentation.

All primary batteries are variations on this theme. They include dry cell batteries using zinc and carbon as the terminals and a mixture of ammonium chloride and zinc chloride as the electrolyte. The carbon terminal is surrounded by manganese dioxide. This battery dates back to the 1860s and was invented by George Leclanché. Another widely used type is the alkaline battery It deploys zinc and manganese-oxide as the terminals; the electrolyte, as the battery's name implies, is an alkaline paste (potassium hydroxide). The mercury battery has zinc and mercury oxide electrodes also encased in a potassium hydroxide. It can be fashioned into tiny disks and is thus suitable for powering hearing aids, watches, and other small devices. There are yet other combinations, including expensive but light silver-zinc devices used in aeronautics and space applications and very tiny zinc air batteries also used in hearing aids. This last category uses oxygen in air as its cathode. When the hearing aid is turned on, the switch actually uncovers a tiny opening to let the air in.

The major limitation of primary batteries is that, with use, chemical reactions change the composition of the two terminals and the power extracted to do work cannot be restored without destroying the structure and reprocessing the metals and the spent electrolyte. Indeed, primary batteries are usually discarded after use.

Storage Batteries

The internal arrangement of secondary or storage batteries is such that simply reversing the flow of current in them can charge them back up again. Instead of drawing current from the negative pole, current is applied to that pole. In a lead acid battery the nearly exhausted anode will gradually turn from lead sulfate back into pure lead; the exhausted cathode, also lead sulfate, will by repeated chemical reactions, triggered by the charging current, become lead dioxide again. The water surrounding the terminals will gradually turn into an electrolyte again as sulfur is reintroduced into it and chemi-cally forms sulfuric acid dissolved in water. The energy of the incoming current will become chemical energy ready for extraction. The batteries are usually recharged before they are completely dead.

According to a listing published by PowerStream, a subsidiary of Lund Instrument Engineering, Inc., some thirteen different types of rechargeable batteries are on or nearly on the market. They are based on different metallurgies, including (in alphabetical order) iron-air, iron-nickel, iron-silver, lead, lithium-ion, manganese-titanium, nickel-cadmium, nickel-metal hydride, nickel-sodium, nickel-zinc, sodium-sulfur, zinc-manganese, and electrodes formed by metallic liquids. Other sources list more varieties or sub-varieties of those already named. The variety of combinations illustrates the great diversity of products the word battery constellates. Each type provides special advantages in energy density, useful life, cost, weight, safety, and other aspects crucial in different uses. Applications range from critical applications as in heart defibrillators and pacemakers, to emergency lighting and power, to power sources for vehicles and spacecraft, with less critical applications like portable telephones, cameras, laptops, tools, and many other devices occupying a middle ground.

>Lead Acid

The largest category is the lead-acid battery, the mainstay of automotive starting, favored by low cost and relatively long life if the battery is treated right and not permitted to discharge entirely. In automotive applications the batteries are referred to as SLI batteries, the acronym standing for starting, lighting, and ignition. In industrial applications lead batteries are referred to as SLAs (for sealed lead acid) and as deep-cycle batteries. They have thicker lead plates and can thus be discharged to a deeper level whereas SLIs, when discharged below about 50 percent capacity, tend to get damaged. SLAs are popular as backup systems for computers and networks in case of power outages. Three other major categories of rechargeables have substantial sales volumes.

>Nickel/cadmium (NiCad)

These batteries are widely used in calculators, cameras, defibrillators, electrical vehicles, and in space applications. They are light, perform well in cold temperatures, and are excellent sources of continuous electrical power. They cost more than lead acid batteries for the same output. Their chief negative is the memory effect, to be discussed more fully under the subheading Problems and Issues below.

>Nickel/metal hydride (NiMH)

This battery—used in telephones, power tools, laptops, and electric vehicles among other applications—is a relatively recent type of battery developed to overcome the limitations of otherwise excellent nickel-hydrogen cells, the hydrogen acting as an anode, thus providing electrons. Nickel-hydrogen cells had to be kept under pressure. In the NiMH battery, hydrogen is provided by various kinds of metal alloys able to hold hydrogen. The battery has more capacity and higher power densities than its competitor, the NiCad. It was also thought to be resistant to the memory effect—of which more later.

>Lithium-Ion (Li-I)

Perhaps the most important type, in light of future uses in electric vehicles, is the lithium ion battery. The category is widely used in laptops, cell phones, and electric vehicles, but is famous for powering the Mars Rover Spirit. Li-ion batteries have a cathode made of a graphite (carbon) matrix and an anode made of lithium oxide. The battery is light, has high energy density, and a long life. A tabulation comparing the four major categories of storage batteries is presented in Figure 16, drawn from a paper by Vulkson and Kelley with the Air Force Laboratory. These data indicate the more significant differences between the different technologies.

Li-ion batteries have superior energy density by weight and volume, total voltage delivered, and a reasonably high life, permitting 2,000 charges. Cycle life is usually calculated as charges applied after 80 percent of the battery charge has been exhausted. Most batteries must be recharged before they are fully drawn down. Battery costs for these types of batteries increase as one goes down in the table. Weight per unit of power decreases. Lead batteries are the oldest and lithium-based products the most recent technologies. In the industry lithium is viewed as the most important candidate to power a post-petroleum era. The technology, however, despite widespread use in electronic devices, is still relatively new and has technical and safety issues to be touched on later.

Other Names and Categorizations

In the North American Industry Classification System (NAICS), batteries are divided into two industries as above, but in the reverse order, thus storage batteries come first, primary batteries second. Classification systems, of course, indirectly reflect the importance of the categories. Storage batteries are the larger industry. Within that industry, the Census Bureau divides the world between lead acid batteries and all others. Census divides the All Others category further into nickel cadmium batteries and all the rest in combination. Within the primary battery industry, the Census recognizes round and prismatic batteries as the larger and button and coin batteries as the smaller part. The prismatic type refers to rectangular 9 volt batteries with both of their terminals sticking out on top in the form of tiny crowns; this type of connection is known as the PP3 (patch panel); prismatics first appeared to power transistor radios. Round batteries have the positive pole extending above the surface of the battery on top; their bottoms are the negative pole. Within the round/prismatic product subdivision, the Census Bureau distinguishes between alkaline, zinc carbon, mercuric oxide, and lithium batteries, hiding the rest under all other. Button and coin batteries describe the smallest of these products. Both are round in shape but coins are much thinner. Here the Census recognizes by name silver oxide, alkaline manganese, zinc air, and lithium batteries. Another all other hides other button-coin metal combinations from detailed statistical view. As we march through this hierarchy of batteries, production numbers get ever smaller—at least in the context of U.S. manufacturing.

Battery Prices and Cost of Electricity

The energy capacity of batteries is stated in milliamps per hour, abbreviated as mAh. A milliamp is one-thousandth of an ampere, and an ampere is a measure of the flow of current. Batteries are also rated by voltage. A volt is the measure of the electromagnetic force between a battery's terminals, thus the battery's ability to pump electrons. This can be thought of as pressure. The milliamp then measures the amount of current that such pumping generates in a unit of time. The mAh and voltage, both as reported, can be used to calculate the electrical power delivered by a battery in a unit of measure most people understand—because they get electric bills in which usage of electricity in kilowatt hours is visible on the bill. A watt is an amp multiplied by volt, thus a composite measure of flow and force combined.

In 2003 electrical costs from the utility grid averaged from a low of 5 cents to a high of around 17 cents per KWh. The average residence consumed 29 KWh a day. To determine how many kilowatt hours a battery actually holds, one divides the milliamp capacity by 1,000 to get amperes, multiplies by voltage to get watt hours, and then divides that result by 1,000 to get kilowatt hours. Just to have some sense of this unit of measure, consider that 1 KWh is equivalent in energy to 860 calories, about 43 percent of a healthy adult's diet per day. To get the energy of a gallon of gasoline, we would have to use around 33 kilowatt hours.

A triple-A battery (AAA) with an mAh rating of 1,100 and 1.25 volts can thus be shown to provide 0.0014 KWh. This is a tiny amount, of course. The battery will cost around $1.60. Dividing that price by the fractional kilowatt hour provided by the battery will produce a price per KWh of $1,164, or nearly 7,000 times the highest cost electrical power coming from the grid. The triple-A battery and the utility company live in different worlds. In order to detach from the utility's cable and still be able to use electricity to listen to that radio on a stroll in the countryside, we pay a high price but, using so little electricity, we don't really notice it.

Using such calculations we can determine, roughly, how primary batteries stack up. Tiny zinc air batteries used in hearing aids and coin batteries used in watches do best. They cost around 90 cents each and deliver electricity at the around $1/KWh, the lowest cost of any battery on the market; their uses, of course, are limited. Other major types are AAA batteries ($1,160/KWh), 9 Volt prismatics ($760/KWh), AA batteries ($520/KWh), C batteries ($200), and D batteries ($100). Prices for these five types of batteries are approximately $1.60 (AAA), $3.20 (9 Volt), $1.60 (AA) and $1.80 (Cs and Ds) per unit. They are, of course, usually sold in multiples.

According to Market Share Reporter, which in turn cites Information Resources Inc., the largest category of household batteries by size is AA (41% of batteries). Others in rank order are AAA (16%), 9 Volt (11%), C (9.1%), D (8.1%). All other kinds represent 15.3 percent of the market.

Storage batteries, of course, are rechargeable. For this reason their output in kilowatt hours is measured differently. Their lifetime output in KWh is calculated by multiplying the KWh of a single charge by the number of charges the battery will sustain before failing. The cost of the unit is divided by lifetime KWh to calculate cost per kilowatt hour. In this process analysts typically ignore the cost of electricity required to charge the battery. KWh costs, therefore, are somewhat understated.

The most cost-efficient battery is the ordinary lead-acid SLI (starting, lighting, and ignition) used in automobiles. SLI batteries are, by design, intended for brief draw-downs of electricity. They cost around $160 per unit and deliver electric power for around $2.22/KWh. Other types have higher costs. Lithium-ion batteries cost around $100 per unit and produce power at a cost of $23/KWh. Other examples are SLAs (sealed lead acids). They cost around $50 and deliver electricity at $8.30/KWh. NiCad rechargeables also cost around $50 and produce electricity at $7.40/KWh. Their chief competitor, the NiMH costs $20 a unit and produces electricity for $4.40/KWh.

These examples are, of course, intended merely to give some perspective. They are a snapshot in time (2007). The estimates are rough because each type of battery is available in multiple implementations and designs, prices vary widely; many batteries are sold at deep discounts. Technology in the field is also rapidly changing.

Problems and Issues

One of two performance problems associated with batteries is the so-called memory effect, experienced with NiCad batteries. The other is the overheating, leading to explosions and fires, associated with lithium batteries. Disposal of batteries holding toxic metals is a potential environmental problem. Other issues fall into categories one might call annoyance or unpleasant surprise.

The memory effect is best described as a temporary loss of battery capacity. For example, a battery recharged when it is still 30 percent charged will, after that recharge, only deliver 70 percent of its capacity, not the 100 percent for which it is rated. This problem was first encountered with NiCad batteries in satellite applications in which batteries were routinely charged at the same time. The loss of capacity can be restored by letting the battery discharge several times fully before being recharged, but battery life is shortened. Since the problem first appeared, changes to the product have largely corrected this difficulty, but the memory effect has, so to say, stuck in the popular memory. NiMH batteries are promoted as being free of the effect, but can also suffer from it under rare circumstances. In general technical solutions have essentially dealt with the problem, but the issue is still frequently mentioned. What some perceive as the memory effect is sometimes due to faulty charging equipment or charging regimes.

Lithium-ion batteries have problems when overheated, be that from external sources or a combination of charging, heavy use, and outside temperatures. Overcharging the battery or manufacturing defects in the insulation separating anode and cathode can cause the battery to explode. Microscopic metal residues inside them can also cause heating up and fires. In 2006, for instance, Sony recalled 10 million batteries used by Apple, Dell, Fujitsu, Hitachi, Lenovo/IBM, Panasonic, Sharp, Sony, and Toshiba laptops due to metallic contamination of the battery. The problems are serious, if rare, and signaled that the relatively new Li-ion technology was still under development at the end of the first decade of the 2000s. Efforts to forestall costly and dangerous product defects were, of course, actively pursued by changing the batteries' internal components and operational chemistries, but such changes also pointed in the direction of reduced electrical capacity in the safer devices under development.

Nickel, cadmium, mercury, and lead acid batteries have significant amounts of hazardous materials by content. Most jurisdictions require their collection separately from ordinary household waste. To make things simpler, all batteries are treated the same way for disposal purposes. The degree to which the public actually participates in separating spent batteries from other wastes is not well documented.

The lifespan of lithium-ion batteries begins immediately after they are manufactured, not when they are placed into use, and this lifespan is between two and three years. This limitation of the product is not exactly featured (or even mentioned) by producers. Lifespan has no relation to number of charges; it simply means how long a time the battery will remain operable. The individual who has bought a device powered by a Li-ion battery may thus have an unpleasant surprise when the device loses life so rapidly and requires an expenditure of $100 or more to keep on functioning. Rechargeable devices, like cell phones, are designed to announce when their batteries need charging, but the user often fails to get the message—a source of annoyance.

MARKET

Information about the U.S. market for batteries at the retail level is only spottily available, but data on industrial shipments of products made in the United States provide a picture of trends. Such data are available from the U.S. Census Bureau, with some detail for 1997 and 2002, Economic Census years. Only total industry shipments, in dollars, are available for other years and only up to 2005. These figures come from the Annual Survey of Manufactures. We will look first at U.S. production and then enlarge the view to the battery market the world over. Two contrary impressions will emerge. One shows domestic production in decline; the other reveals energetic expansion of domestic demand. Imports explain the difference.

In 2005 U.S. domestic battery shipments of $6.66 billion were recorded by the Census Bureau. These divided into primary batteries with 43 percent of the dollars and storage batteries claiming 57 percent. The year was not a peak, however. Eight years earlier, in 1997, the industry had shipped goods worth $6.9 billion. The decline came because storage batteries declined from a level of $4.3 to $3.8 billion between the two years. Primary battery shipments increased, from $2.6 to $2.9 billion, but not enough to compensate for the loss experienced by storage batteries. Total industry shipments thus declined at the rate of 0.2 percent per year, storage batteries declined at an annual rate of 1.5 percent, and primary battery shipments grew at an anemic rate of 1.7 percent per year, just a shade over the 1.3 percent growth of the population.

In contrast to these rather lackluster trends in domestic production, the world market grew at a much healthier 4.3 percent per year in the 1997–2005 period. World storage batteries grew at 2.5 percent and primary batteries at 7.3 percent per year. The total market was $49.6 billion in 1997, an estimated $68.0 billion in 2005, and $77.5 billion in 2007. Note, however, that these values are not directly comparable to U.S. production shipments. World data are retail sales. Estimates of U.S. retail sales are available for two years only. In 2007 the U.S. share of the world retail market was $15.5 billion, thus around 20 percent. U.S. retail sales, however, were also growing, up from $11.7 billion in 2002, a 5.8 percent increase in that period. That rate of growth was lower than world growth in the same period (7.6% annually) and in sharp contrast to U.S. domestic shipments, as noted above. The bottom line is that all the growth in the U.S. retail sector came from imports. Data on world markets and U.S. retail sales just given are based on information published by the Freedonia Group, a market research firm, as quoted in "Factors Affecting U.S. Production Decisions: Why Are There No Volume Lithium-Ion Battery Manufacturers in the United States," a 2006 report issued by the U.S. Department of Commerce (DOC).

To summarize the market picture as it appeared in the 1997–2007 period, both the total world and U.S. retail markets were growing at a fairly high rate, particularly for what is a rather mature industry. The most rapid growth has been in the primary battery category. The U.S. retail market advanced but its domestic segment was, at best, flat.

Factors Influencing the Market

The domestic industry's performance in the early 2000s was such that it caused the DOC to commission a special study to look into it, the study just cited above. It was carried out under the auspices of DOC's Advanced Technology Program. The study focused on Li-ion batteries because these represent the most advanced products powering electronic devices like cell phones, laptops, and music players. The study's conclusions highlight important new factors influencing the evolving battery market.

DOC found that domestic manufacturers opted out of volume manufacturing of Li-ion batteries for three principal reasons. They saw low return on investment compared to their existing operations, long lead times and high costs before commercial products could be produced, and because this product category required establishing technical sales organizations to reach Japanese producers who, in turn, would be the dominant original equipment manufacturers (OEMs) buying the product. Enlarging on this general conclusion, one might say that the shift in manufacturing of electronic devices of all kinds to Japan, Korea, and Southeast Asia has made it necessary for a U.S. manufacturer to take part intensively in that industry overseas in order to obtain the technical information and to keep up with development effectively enough to tailor-make products powering devices largely made overseas. In effect, U.S. manufacturers have chosen to concentrate on the mature segments of the battery market leaving the emerging and developmental segments to others.

World market shares of batteries by type, as estimated by Freedonia Group, are shown in Figure 17. The pie chart, based on total dollar sales, is divided into segments representing storage batteries, marked by dots, and primary batteries, marked by lines. Storage batteries represent 59 percent, and primary batteries 41 percent of the total market. Lead acid batteries, overwhelmingly automotive SLIs, are the largest segment followed by alkaline batteries, the second largest and the dominant segment in the primary battery category. Together with nickel batteries (which include both NiCad and NiMH unit sales) and carbon zinc, these segments together represent the old industry. New battery technologies are hidden under the other label in Freedonia's estimates. The fact that they represent major departures from the traditional segments becomes clear when we look at growth patterns from 1997 to 2007.

Figure 18 displays annual growth rates of each segment and of the Primary and Storage group for the ten year period. It is worth noting that in both categories, the highest rates of growth have been achieved by the other categories, that cluster growing at 12.3 percent per year in the primary and 15.7 percent in the storage battery grouping. Behind these very dramatic rates of growth is the world-wide expansion in the use of cells phones, laptops, and all manner of other portable electronic devices. The chief beneficiaries of this growth appear to be lithium-ion battery producers. The DOC study reports that Li-ion cell production increased from a level of 32 million cells in 1995 to 770 million in 2002, a growth of 57 percent per year. Lithium batteries have come to dominate a number of applications, including personal digital assistants (PDAs), digital cameras, movie cameras, cell phones, and laptops and other portable computers. Nickel-based batteries have been dominant in portable audio-visual equipment, cordless telephones, and power tools. In these latter segments NiCad batteries have been dominant. NiMH batteries, however, have a minority share of these applications and also participate in digital cameras, cell phones, and PCs where NiCad is not used. Beckoning from the more distant future is the prospect of using advanced storage batteries in transportation applications.

KEY PRODUCERS/MANUFACTURERS

Johnson Controls, Inc. (JCI)

This company, based in Milwaukee, Wisconsin, is thought to be the largest manufacturer of lead acid batteries in the world, selling around 110 million units per year. The company entered this market in 1978 when it acquired Globe Union Inc. Since then JCI has expanded by acquisition. In 2002 it acquired the German Hoppecke Automotive Gmbh, in 2003 Varta Automotive Gmbh and 80 percent of Autobatterie Gmbh, and in 2005 the company purchased Delphi Corporation's worldwide battery business. Varta Automotive also owned dry cell battery lines, including button and coin batteries. That portion of the business was sold to Rayovac. JCI sells batteries to auto companies (OEM sales), replacement batteries, marine and industrial batteries, and batteries used in telecommunications. Johnson Controls has 110 operations in twenty-eight countries in Asia, Europe, North America, and in South America. In 2006 the company had sales of $32.2 billion of which 11 percent ($3.5 billion) was in batteries.

Exide Technologies

Another world leader in the lead acid segment is Exide Technologies, based in Alpharetta, Georgia. The company, whose chief business is battery manufacturing, had sales in 2006 of $2.8 billion. Its products are destined for automotive, marine, motive power, and telecommunications applications. Motive units are used in forklifts, for instance. Telecommunications products include stand-by power products for computer networks, among others. The company began in 1888 with the commercialization by W.W. Gibbs of what was first known as the chlorine accumulator. The company was originally called Electric Storage Battery Company. Its name was originally a brand—the shortening of the phrase excellent oxide.

Duracell

Two companies dominate the alkaline battery market, Duracell and Energizer. Duracell had its origins in the 1920s when Samuel Ruben, an inventor, joined the P.R. Mallory Company. The company was later known as Mallory Battery Company and eventually as Duracell International. The company name was initially one of Mallory's brands, transferred to the entire corporation in 1964. Duracell merged with Gillette in 1996 and then became part of Procter & Gamble when P&G acquired Gillette in 2005. P&G reports on Duracell together with Braun, a razor manufacturer it also owns. These two companies together represented 4 percent of P&G's revenues of $68.2 billion in 2006, thus around $2.7 billion. Dura-cell is the leading producer of alkaline batteries worldwide but also sells other types of batteries.

Energizer

Energizer Holdings, Inc. began in 1896 as National Carbon Company (NCC) when it introduced the first mass-produced battery to the market, called The Columbia. The battery was six inches high and powered telephones. In 1914 NCC acquired a company called American Ever Ready. This organization, which began as American Electric Novelty and Manufacturing Company, created the flashlight. NCC thus became the first company to sell a device and the battery that operated it. The Energizer name arose as the rebranding of the Eveready battery. The Eveready name still continues in use in Asia. In 1917 NCC became part of Union Carbide. Ralston Purina acquired Energizer in 1986 but spun it off as an independent, publicly traded company in 2000. Energizer's sales in 2006 were $959.2 million, of which $723.7 million were batteries; and of that total 64 percent were alkaline cells. Whenever batteries are mentioned in the United States, thoughts of the Energizer Bunny tend to arise, the Bunny having been one of the most successful advertising icons of the twentieth century. Worth noting is that the Energizer Bunny has been going since 1989—and is still going!

Spectrum Brands, Inc.

Rayovac Corporation changed its name to Spectrum Brands, Inc. in 2005. The company is the leader in rechargeable NiMH batteries used in many portable devices in competition with lithium batteries. In 2006 Spectrum had sales of $2.55 billion; of this total batteries represented 34 percent or approximately $870 million. Spectrum's two major brands are Rayovac and Varta, the Varta brand being the primary battery lines of the German Varta Automotive mentioned above, the lead acid lines of which were acquired by Johnson Controls.

Asian companies dominate the lithium-ion battery market, with Japanese companies having an 80 percent share of total market. Among them the top three are Sanyo Electric Co., Ltd. with 27 percent, Sony Corporation with 21 percent, and Matsushita Battery Industrial Co., Ltd. (MBI) with 10 percent of world market share. These names, of course, have become very familiar to U.S. consumers in the context of electronic products generally.

Sanyo

This company's total sales in 2006, converted from yens, were $18.9 billion. Of that total, its battery sales were 18.7 percent or $3.5 billion. In addition to lithium batteries, the company also makes and sells nickel-based products. The company's orientation is industrial but Sanyo plans on introducing a line of consumer batteries as well.

Sony

In total size Sony is a much larger company, with $63.9 billion in sales in 2006. Of this total 64.3 percent was in electronics, in which category Sony includes components, but the company does not categorize batteries as such. Based on Sony's market share, however, its participation would appear to be at the level of $2.7 billion. Sony is best known for supplying battery systems for laptops.

Matsushita, MBI

This company is the producer of the Panasonic brand of batteries, available in alkaline, manganese, oxide, and lithium chemistries. The company also makes button and coin primary alkaline batteries. MBI's rechargeable batteries cover the range. They include lead acid, NiCad, NiMH, and lithium batteries, including a line of automotive batteries intended as primary propulsions for electric vehicles (EVs) and hybrids. MBI is part of the much larger Matsushita Electric Industrial Co., Ltd., a company with $76 billion in sales in 2006.

MATERIALS & SUPPLY CHAIN LOGISTICS

Major metals—and their future availability—play the most important role in the expansion of battery-based power. Zinc, nickel, and cadmium are central in the production of primary batteries. Storage battery technology is based principally on lead and nickel. Advanced storage batteries make use of lithium. Using summaries provided by the U.S. Department of the Interior in its Mineral Industry Surveys (MIS), the following snapshot emerges for the year 2006:

Zinc

The metal is available in large deposits all over the world and is also heavily recycled. Most zinc is used in the steel industry as an alloying component. World production in 2006 was 10 million metric tons with reserves at 220 million and reserve base at 460 million metric tons. The reserve base, as defined by the U.S. Geological Survey (USGS), includes reserves readily and economically extractable as well as other resources that require more development. One might think of it as deep reserves. When zinc is mined, the three largest co-products of its extraction are lead, sulfur, and cadmium.

Nickel

The metal was in high demand in 2006 with world consumption running at the rate of 1.55 million metric tons, two-thirds of which was consumed in making stainless steel. Growing demand came from economic development in China and India. Prices had more than tripled since 2002 running at $10.83 per pound in 2006, up from $3.07 in 2002. The largest reserves in the world were located in Australia (24 million metric tons) and in Russia (6.6 million metric tons). Well proved reserves suggested 41 years supply; deep reserves were sufficient to last 90 years, when more difficult underwater sources will have to be tapped.

Cadmium

Most cadmium mined (82%) was used in NiCad batteries. According to the USGS cadmium consumption declined 14 percent between 2002 and 2006 as substitutes were replacing it, presumably the NiMH technology. Very large reserves of sphalerite ores, the principal sources of cadmium, exist. Sphalerite is zinc and sulfur and mined for its zinc content; cadium is a by-product.

Lead

In the United States most of the lead consumed in 2006 was satisfied from recycled lead batteries. Consumption was 1.55 million metric tons and scrap collections 1.13 million metric tons (73% of consumption). Most of the lead consumed, 88 percent, was used for SLI-type auto batteries, 3 percent for ballast and counterweights, and 9 percent for ammunition, pipe, and industrial products. Mine production worldwide ran at the rate of 3.4 million metric tons in 2006. Reserves were 67 million metric tons, sufficient for a 20-year supply, and deep reserves amounted to 140 million metric tons.

Lithium

Lithium reserves across the world in 2006 were 4.1 million metric tons with mining drawing down 21,100 metric tons, suggesting supplies, at current rates of use, of nearly 200 years. Deep reserves were 11 million metric tons. Chile with 3 million metric tons and China with 540,000 metric tons had most of the reserves. U.S. reserves were around 38,000 metric tons. Lithium use in batteries amounted to 21 percent of consumption. Recycling of lithium was beginning to be practiced using spent batteries as the source of the metal in a development analogous to lead recycling.

Based on this snapshot in time, the metal under most pressure at the end of the first decade of the 2000s was nickel, not only because it is heavily used in making stainless steel but also because it was the basic raw material for NiMH rechargeable batteries in electric vehicles (EVs), the most common type used in experimental and developmental EVs for their inherent safety and long life. The deployment of lithium batteries in EVs is eventually likely, but at the end of the first decade of the twenty-first century lithium batteries were not ready for depolyment.

DISTRIBUTION CHANNEL

Alkaline batteries used in ordinary household applications have a three-tier distribution system in which producers sell to retailers through wholesalers, the retailer selling the product to the ultimate consumer in hardware, drug, grocery, convenience, and mass merchandising outlets. Rechargeable batteries typically follow a double path. They reach the consumer as part of a product and are therefore sold by the producer to original equipment manufacturers. The consumer, however, will also buy replacement batteries at retail. Where such purchases take place depends on the type of battery being replaced. Automotive products are sold by garages and auto supply houses. Batteries for electronic equipment are sold by stores that specialize in retailing computers, telephones, cameras, and audio-visual equipment. In that batteries suitable for a device are readily discernible by examining the equipment powered and/or its accompanying literature, many battery sales are taking place over the Internet, ordered online and delivered by mail or other carrier.

KEY USERS

The use of batteries is universal. In combination with satellite systems circling the globe, battery powered radios and telephones are providing information and communications even in areas of the globe once considered to be remote wilderness. Batteries are crucial to those who use them for immediate, personal, and physical support. Thus the smallest of batteries are the most important to selected individuals—those requiring heart pacers or using hearing aids. People required to use powered equipment far from the electric grid rely heavily on battery powered equipment in the field, not least of which are scientific workers, foresters, surveyors, rescue teams, fire fighters, and military and police forces. Batteries play a key role in health and security situations, thus in providing critical alternative power in medical institutions for equipment and lighting. Battery systems are installed in tandem with emergency generating equipment. Battery-based backup systems are routinely deployed to prevent the loss of information on single computers and on network servers. Battery based power, with the recharging role fulfilled by solar panels, is also the principal source of energy in space applications and other remotely-sited monitoring installations.

ADJACENT MARKETS

Batteries are by their very nature component parts of other things—indeed the crucial component parts. A large flashlight without batteries might serve, perhaps, as a handy weapon to club an intruder, but it has few other uses. The batteries without the flashlight might serve, perhaps, as paper weights. For this reason the concept of adjacency ill-fits this product category.

One way to look at batteries, in this context, is by functionality. In the past lighting was produced by candles and small motions, thus those inside of clocks, for instance, by wound springs or weights combined with gearing. In appliances that require very little power, such as calculators, solar power is used to run the device. Battery-driven power tools can be replaced by others employing small internal combustion engines. In larger devices used for lighting, for instance, adjacent products are those by-passed by time, such as kerosene lamps. In large applications the combustion engine reappears again powering an emergency generator.

In effect batteries represent the extension of a modern technology, electricity, into areas where the wire, which delivers electricity, cannot reach. To replace this new convenience, we have to dust off older solutions that predate Edison or reach ahead in time to imagine the perfection of arts still not quite measuring up, such as effective, energy-dense, portable, and miniaturized solar energy devices.

RESEARCH & DEVELOPMENT

A look at battery technology, as at least lightly touched upon in all that has been said so far, reveals that it is rooted in very sophisticated chemical engineering approaches to holding and releasing electromagnetic force by combining elements and compounds. The chief issues in improving this technology and extending it further into even more applications include:

• Increasing energy density while decreasing weight
• Extending the inherent life of the device
• Removing danger and risk
• Reducing cost

We are living in an era where the ultimate exhaustion of hydrocarbon fuels for transportation is becoming a matter of decades rather than centuries. At the same time, coal resources and electrical energy from nuclear, hydro, and geothermal sources have much longer time horizons. For this reason a great deal of R&D in this field is directed toward development of effective batteries for electric vehicles. The best candidate for EV batteries as of the end of the first decade of the 2000s is lithium technology because it has the highest densities and the lowest weight. Lithium batteries, however, have a very short life and are extremely sensitive to tampering, contamination, and external temperatures. Battery failure can be very costly, indeed dangerous. Lithium batteries also cost a great deal. Research is being devoted especially to advanced, indeed the most esoteric, materials combinations aimed at powering electronic devices and automotive propulsion (rather than starting and ignition) batteries.

CURRENT TRENDS

Two major trends act like weather systems that create the climate for the battery industry. One of these is the expansion of computer intelligence into every conceivable device to provide convenience, unattended operation, transportability, and off-wire communications powers. This technological development leads to miniaturization and concomitant requirements for miniaturized sources of power, ideally supplied by batteries. Tiny, hand-held personal digital assistants with computing power matching those of once massive computers are an example but, if trends continue, only the tip of a future iceberg.

Looming future energy shortages, particularly in the transportation sector, already sketched briefly in the section on R&D, represent the second trend. In the long term liquid fuels from crude petroleum will disappear but electric power will continue to be available. The best means of transition between the two is represented by battery technology.

TARGET MARKETS & SEGMENTATION

This very mature industry—yet with a very new and hi-tech leading edge—has well established target markets based on end use. These have been largely outlined above. In summary, lead acid technology is aimed principally at automotive starting applications using thin-plate devices. SLAs, with thicker plates, capable of deeper discharge, are used in industrial and commercial backup systems in stationary applications. Alkaline batteries are aimed at consumer uses in portable devices. Miniaturized devices, disposable and rechargeable, are used in watches and in medical devices. Lithium technology dominates the rapidly growing demand produced by new electronic devices, competing with NiMH batteries. These same technologies compete for the other still gestating future deployment of batteries to move cars and trucks down the highways of the world.

RELATED ASSOCIATIONS & ORGANIZATIONS

Battery Council International, http://www.batterycouncil.org

National Electrical Manufacturers Association (NEMA), http://www.nema.org

Portable Rechargeable Battery Association, http://www.prba.org

BIBLIOGRAPHY

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