What is the hold-up given the hyped applications where TFBs could play? Although there are multiple metrics along which to evaluate TFBs – including relative Wh/kg, Wh/L, safety, flexibility, and capacity – the single biggest roadblock remains cost. Today, depending on the technology, TFBs can cost $28/Ah or more ($7,500/kWh or more). This is an order of magnitude higher than other types of energy storage including Li-ion cells that typically cost less than $2/Ah ($500/kWh) and coin cells costing less than $1/Ah ($250/kWh).
We modeled three distinct cost-reduction scenarios for TFBs, and found that in the likely case, the market will grow to about $400 million in 2025 (18% CAGR), driven by the emerging wearables category in consumer electronics, where thin form factors and added flexibility are key. This assumes no major technical breakthroughs and relatively small investments over the coming decade – on the order of $1 billion or less collectively – leaving TFB costs at about $10/Ah in 2025. In the optimistic scenario, TFBs would reach $3/Ah in 2025 but this would require strong technical improvements to boost capacity and reduce costs in addition to more than $1 billion invested into scale-up. In the very optimistic scenario, TFB revenues in 2025 could be as high as $4 billion (49% CAGR), but would require technological breakthroughs to reach $1.4/Ah, nearly matching Li-ion, plus more than $5 billion in scale-up investment.
This leaves different players in the nascent value chain having to hedge bets, monitor progress and be ready to act. At one end, chemical and materials players should monitor for innovation and look to repurpose other battery development activities, but it is premature to have dedicated TFB development. Battery makers should establish strategic partnerships with IoT device developers, not only consumer electronics giants but also smaller innovative players. In addition, TFBs should be optimized for relatively higher capacity electronics uses, with an additional focus on rechargeable battery chemistries. At the end of the production value chain, consumer electronics OEMs must monitor for key innovations and activity, but plan on most products, even flexible ones, using non-TFBs. If there is a breakthrough technology, they will need to engage quickly and exclusively, as it can create an opportunity to differentiate devices on the market.
TFBs will continue to be supported in R&D and by starry-eyed investors, but with killer technology and killer apps for it still off in the distance, a measured approach to R&D -- but a steady, engaged approach to monitoring and partnering -- is the right path.
Source: Lux Research report "Powering Mobility in the Internet of Things: Strategies for Thin-Film and Flexible Battery Success"