Tech Hardware Supply Chain - Gazhoo

Bhavin Shah
(852) 2800-8538
bhavin.a.shah@jpmorgan.com
Asia Pacific Equity Research
20 April 2009
Specifically, the performance enhancements required of batteries are: (1) an increase
in energy density; and (2) expansion in the usable charge range. Putting this in more
intuitively comprehensible terms, batteries need to: (1) store as much electricity as
possible within a given weight; and (2) use up all the stored electricity with little
waste.
Much higher requirement in energy density
The battery capacity required to run PHEVs as EVs will likely turn into a bottleneck
and capacity (energy density, Wh/kg per unit of weight) needs to be increased as far
as possible. On the other hand, the bottleneck for HEVs is likely to be the power
delivered to drive the wheels, rather than battery capacity, so batteries with high
power per unit of weight (power density, w/kg) are required. PHEVs have more
batteries than HEVs and thus they can meet total power requirements even with low
power density.
Table 143: Required battery performance
unit HEV PHEV EV
C apacity Wh low medium high
Output W low -medium medium medium
Energy density Wh/kg low medium high
Output density W/kg high medium low
Source: J.P. Morgan.
Increase in available charge range
EV run-distances can be extended if vehicle-mounted batteries can be recharged to
their maximum limit and discharged to their lowest limit. The actual range within
which a battery can be used compared to its capacity is called the chargeable range
(discharge depth), and there is a proportional relationship between the usable charge
range and EV run-distances.
We estimate that current NiMH HEVs are repeatedly recharged and discharged in a
relatively narrow chargeable range of 40%-60%. This is because a buffer is needed to
meet safety and lifespan requirements. On the other hand, battery capacity can be
increased within the permissible additional weight for PHEVs, so the usable charge
range is usually increased to 20%-100%, and there is said to be a need to control the
number of installed batteries.
Growing importance of PHEVs
In the US, the California Air Resource Board (CARB) has started to consider
concessions for PHEVs. California’s famous zero emission vehicle (ZEV) regulation
may provide greater concessions for PHEVs capable of running as EVs over a
specified distance than for AT-PZEVs, a category which includes HEVs and natural
gas vehicles. No decision has been reached yet on the required run-distance as an EV,
but if this were set at 10 miles (16 kilometers) or so, it could provide a powerful
catalyst for PHEV diffusion.
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