Fireside Chat: Meet the Electric Battery Industry’s Next ‘Top Chef’ thumbnail

Fireside Chat: Meet the Electric Battery Industry’s Next ‘Top Chef’

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Our latest Fireside Chat is electric. I had a chance to sit down (virtually) with Dr. Moshiel Biton, CEO and co-founder of Addionics. Founded in 2017 and based in Israel and the U.K., privately held Addionics makes next-gen rechargeable batteries for use in electric vehicles (EVs) and other commercial and residential applications.

an electric vehicle (EV) at a charging station representing EV stocks

Source: Alexandru Nika / Shutterstock.com

The electric vehicle market couldn’t be any more competitive. Almost every auto manufacturer demands longer-lasting, longer-range and faster-charging battery cells from its suppliers. So, the race is on for a better battery.

But the choice to go electric isn’t just about speed and charge. Lithium batteries amplify two other important problems. First, pollution. Electric vehicle batteries contain materials such as graphite, cobalt and nickel — materials that during the mining and refining process cause greenhouse gas emissions. The second issue? Safety (they cause fires and explosions).

Until we solve these limitations, the electric car revolution can’t really take off in the way bullish investors want. But here’s a funny irony. The science behind most lithium-ion batteries hasn’t changed much over the past three decades. In fact, most of the recent technology tweaks have been focused on minor changes in battery chemistry. These changes haven’t advanced the industry that much. 

Enter Addionics, a company with a unique alternative to today’s lithium-ion batteries, which we’ll discuss below.

Here’s what Moshiel had to say about the electric vehicle market, today’s battery architectures, what happens to the supply chain when Tesla (NASDAQ:TSLA) Gigafactories pop up like “mushrooms,” and why a metaphorical battery sandwich is better when the cheese is layered inside the bread instead of on top.

Addionics Overview

Addionics says it can improve car battery performance, increase mileage and safety and reduce cost and charging time. But, the company isn’t the only battery disruptor in town. Tesla (NASDAQ:TSLA), along with startups like Sila Nanotechnologies, Amprius and others are putting more silicon as opposed to graphite in the anodes of lithium batteries.

Silicon has 10x the energy density of graphite. The result: better charge capacity and lifespan. There are also companies like QuantumScape (NYSE:QS) building solid-state architectures. These use solid electrodes and a solid electrolyte, instead of a liquid or gel electrolyte.

While the architectures of today’s next-gen batteries differ, they share a common goal: to reduce the industry’s reliance on harmful materials while delivering improved performance, green-ness and safety. 

Like many of its fellow disruptors, Addionics believes the answer to all of life’s battery architecture problems is in the physical structure of the battery itself. Using a patent-protected scalable 3D metal fabrication method, Addionics says its battery can reduce charging times by half.

Here’s how it works. Addionics’ architecture consists of electric current collectors, or small metal sheets, similar to the aluminum foil found in almost every kitchen. These sheets are layered with the battery’s chemistry (active materials), which determine the battery’s electric capacity.

The electrodes act as a “sponge,” meaning more of those active materials can be “squeezed” in, to increase battery energy density, capacity and lifecycle. The electrodes also reduce internal resistance in the battery, enabling higher currents.

The result? Electric vehicles have more “juice” and longer range. The architecture also reduces internal heating, minimizing the chance of another exploding vehicle.

Let’s dive into the interview to find out more.

What do you think about the EV battery market?

Yes, it’s very exciting, and maybe the best time in history to be in the battery domain. When I joined the battery domain more than 10 years ago, it wasn’t [as] sexy [as it is] today … But today, [people are] desperate to get [a] better battery. I think it’s one of the biggest problems today. And we are at the beginning of the problem. It’s not going to be fixed somehow, you know, by magic. If we have more electric vehicles, we need more batteries, we need more production, we need more supply. So it’s really an interesting time. [Electric vehicles] will cause more problems [such as] more batteries, more recycling, and more waste … and the world will be desperate to get improvements in batteries. 

On the pace of battery innovation…

We know that the pace of battery improvement is very slow. [It is] incremental innovation compared to [what we’ve seen in] the semiconductor industry … I came from the semiconductor industry and moved to the battery industry … it wasn’t sexy at all at that time to do that move … [But] we cannot blame the science. People [have already] tried almost everything. But it’s very difficult … I would say, we have a very ambitious goal, to change the architecture of batteries, which hasn’t been changed in the last 30 years. [Even] Tesla are using the same structure architecture that was invented in the 90s. They are using the same structure with the new design, the “tabless battery,” but still, the  concept, the basic design, [and] architecture from the inside is the same.

What are the limitations of current battery architectures?

I think the reason that we don’t see better architecture[s] is because it’s working. It’s cost effective. And we are replacing a component, which today is a commodity … There is no … manufacturing process today that can solve or change the architecture … Even if you were to tell people [your technology would allow an EV to] go 1000 miles, but it will cost 2000 times more, no one would move. So, if you want to come [to market] with [a] novel architecture, you need to remember two really important things: scale — how to make millions of batteries a day — and at competitive costs. 

We’re hearing a lot about supply chain shortages. Is the EV industry limited by a shortage of lithium? 

The main problem, in terms of the supply chain, is raw material[s]. The other problem is the decoupling between China and the U.S. I think it’s a huge, huge problem. China controls 70%, maybe 80% of the lithium ion battery [supply] in the world. They are already controlling the supply chain. The mining, even in Australia and South America, [is] controlled by Chinese companies. In this way, lithium is similar to oil … With oil you can get better technology to drill deeper and get more oil. And [similarly], in terms of how much lithium we have on Earth, I think we are still fine … [recycling will also give us more lithium] … but [Tesla’s] Gigafactories are growing like mushrooms. We will need to increase the capacity by 30 times if we want to meet by 2030 the amount of batteries to support and meet [OEM demand]. 

On batteries as a national security issue…

Batteries are becoming essential material, and an issue of national security. It’s similar to oil. To have the freedom to have enough batteries to provide enough batteries for EVs. But it’s not just electric vehicles … we are also talking about energy storage, which is becoming super crucial. Wind and solar energy is not enough. 

What are the milestones and limitations to getting your product into these commercial EV manufacturers?

There is a huge problem for small carmakers, because the market [the supply chain] is sold out for them … [If ] you want to ensure that [auto OEMs] have enough batteries, you need to build factories closer to the supply chain … There are some [EV] companies [whose] differentiation is not innovation — it’s logistics.

Carmakers today understand that in order to make sure they have enough supply, and to gain economic benefit, as well as a performance benefit, they need to bring battery technology in-house. 

On the company’s unique battery architecture…

Instead of [most batteries], which have a 2D metal foil … [with] the active material, or chemistry, on top, in our case, it’s integrated. Think about a slice of bread. The bread is the metal foil … On top of that you put a slice of cheese. This is the active material. This is what we have today in all batteries … In our case, the cheese is not only on the top. It’s inside.

Our bread is very porous, like a sponge. So we are creating more real estate while keeping the same surface area. We can improve power and energy intensity. And that’s the Holy Grail. Everyone is trying to do that … If you have a bigger battery, you will have more energy but it will take more time to charge. That’s the value of our [company] background in nanotechnology. There is still lots of room in the battery that is not utilized.

[Today’s batteries have a] diffusion limitation. You cannot access all of the capacity … So while [they] promise that you can drive for 300 miles — that’s the theoretical capacity. When you drive your car at high speed, or are trying to climb a mountain, you need to use lots of current. You’ll push the gas and then you’ll see the battery percentage or range will drop. That’s [because of] diffusion limitation … Our architecture reduces the internal resistance, the ohmic losses. We can increase the theoretical capacity and make the 300 mile [range] into 400 miles … but we can also access all 400 miles.

Do you own an electric vehicle?

I’m using my legs … I walk.

Your comments and feedback are always welcome. Let’s continue the discussion. Email me at jmakris@investorplace.com.

On the date of publication, Joanna Makris did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Joanna Makris is a Market Analyst at InvestorPlace.com. A strategic thinker and fundamental public equity investor, Joanna leverages over 20 years of experience on Wall Street covering various segments of the Technology, Media, and Telecom sectors at several global investment banks, including Mizuho Securities and Canaccord Genuity.

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