It is crucial for many of the today's leading edge technologies and future large scale industries to obtain low cost, reliable, and safe energy which can be supplied by long-life, rechargeable batteries. The U.S. is now competing with other nations to be a leader in this rapidly growing, $42 billion worldwide battery market, which is growing by 8.6 percent annually.
The U.S. Federal government has recently
invested unprecedented amounts in battery research and
development. Despite these large battery investments,
technology improvements have been slow and recently, many of
the most exciting ventures have gone bankrupt. New innovations
in battery technology are underway and Federal tax incentives
are available for companies investing in eligible leading-edge
Enacted in 1981, the federal Research and Development (R&D) Tax Credit allows a credit of up to 13% of eligible spending for new and improved products and processes. Qualified research must meet the following four criteria:
Eligible costs include employee wages, cost
of supplies, cost of testing, contract research expenses, and
costs associated with developing a patent. On January 2, 2013,
President Obama signed the bill extending the R&D Tax
Credit for 2012 and 2013 tax years.
The U.S. Federal government and some State governments have recognized the importance and need for new battery technology and have provided hundreds of millions of dollars in economic incentives during 2009 and 2010 for battery manufacturing and research and development.
In 2009, President Barack Obama provided a $2.4 billion package designed to spark new battery research as part of the American Recovery and Reinvestment Act. Figure 1 below shows five major recipients of these economic incentives. With continuing resolve, the nation is now proceeding with a more traditional government sponsored research approach.
Evidencing the technological challenge and high-risk nature of these investments, four of these companies confronted bankruptcy only a few years later in 2012 and 2013.
A123 Systems filed for Chapter 11 in October 2012. A123 Systems has won approval from the bankruptcy court to exit and will pay off creditors by setting off its assets. The company is also changing its name to B456 Systems.
Exide Technologies filed for bankruptcy protection in June 2013 as part of a restructuring process. Exide had $1.9 billion in assets and $1.1 billion in liabilities according to Delaware's bankruptcy court. The company struggles with $31 million in debt interest payments due in August 2013, and $51.9 million worth of bonds. Bankruptcy lenders gave the business six months to compose an acceptable business and nine months to file for bankruptcy.
ReVolt Technology was unable to raise necessary new capital and the company filed for Chapter 7 in October 2013. ReVolt will be liquidated not restructured.
EnerDel's parent company, Ener1, was the
third battery company to file for bankruptcy in New York State
at the end of December 2012. The company's bankruptcy is
listed at $73.9 million in assets and $90.5 million in debt.
The five major industries tackling the battery technology impasse include electric vehicles, robots, fuel efficient planes, utility electric grids, and mobile devices.
The U.S. Department of Energy has formed the Joint Center for Energy Research, JCER, where five departments of energy national laboratories, five universities, and private companies' objective will be to advance energy-storage technology and a next generation battery. "We want technology... that can satisfy two needs of society: One is for transportation services; to have a less expensive, more lightweight battery. And the other is for storing energy on the grid, which is becoming more and more of an issue." Its objective is to produce a battery with approximately five times more energy than today's batteries at one-fifth's its current cost. This outcome should be achieved by 2018. The Department of Energy will give a total of $120 million worth in grants to 23 R&D projects over the next five years.
Figure 3: Organizations involved with the JCER battery project:
Harvard professor, Jennifer Lewis, and her researchers are currently testing microscopic rechargeable Li-ion batteries produced by a 3D printer . Each lithium-oxide battery carries 1 milliwatt of charge, weighs 1,000 times less than the lightest Li-ion battery, and can be equipped with microphotovoltaic cells to enable solar recharging of the batteries.
The 3D printing of these batteries is extremely compact, containing 8 or 16 levels of zigzag pattern within .25 mm or .5mm. This battery technology could power biomedical implants, sensors, tiny electronics, hearing aids, or flying drones. Lewis and her researchers are testing other materials, shapes, and sizes to increase battery life.
Researchers at Stanford University have created a rechargeable zinc-air battery that would be a better alternative to the Li-air solution as it has higher durability and activity at a smaller cost. Zinc-air batteries work by combining oxygen with zinc metal inside a liquid electrolyte. The byproduct is zinc oxide which creates an electrical charge. During the researching phase, oxygen and zinc are regenerated, which in turn renews the zinc oxide.
Zinc-air batteries use a cobalt-oxide
catalyst for discharging and a nickel-iron hydroxide for
recharging. Professor Hongjie Dai of Stanford's chemistry
department says "We achieved record high-efficiency for a
zinc-air battery, with a high specific energy density more
than twice that of lithium-ion technology". The novel
advantages of zinc-air battery usage include its low cost and
abundant zinc metal supply as well as its increased
operational safety of the non-flammable electrolyte materials.
"It's the dawn of the energy-storage age" says Bill Radvak, President of American Vanadium. The demand for rechargeable batteries is drastically increasing as the market for mobile devices is growing. By 2016, the battery market is supposed to peak at about $86 billion.
Li-ion batteries have taken a substantial role in the electronic market, yet the low availability of lithium oxide will raise the prices of this material. As lithium oxide becomes a high price commodity, the goal of future companies will be to mass produce a cheaper alternative such as zinc and nickel batteries.
Improved battery technology is key to many of the countries' distinct, growth potential industries. The scope of the challenge is illustrated by some large and sudden failures as well as innovative beginnings. Federal and State tax incentives are available to support companies engaging in battery technology R&D activities.
Charles R Goulding Attorney/CPA, is the President of R&D Tax Savers.
Andrea Albanese is a Project Manager with R&D Tax Savers.
Charles G Goulding is a practicing attorney with experience in R&D tax credit projects for a host of industries.
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