Why Did The US Miss Out On Batteries? – CleanTechnica

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I recently came across a thought-provoking post on social media that raises an important question: How did the United States miss out on the battery revolution? This question is important not only to the future of EVs, but important to the future of the world — it deserves not only some further analysis, but some answers.

1/Here’s something I’ve been wondering about recently: How did the U.S. miss the battery revolution?

With every other technological revolution, we anticipated it well in advance, and as a result we were the first — or one of the first — to take advantage of it.

— Noah Smith 🐇🇺🇸🇺🇦 (@Noahpinion) July 28, 2024

The Question

To understand what Noah is asking, we need to review the question. You can read the whole thread yourself if you want to explore the history, but I’ll try to summarize it real quickly here.

If you look at the history of computer technology, the United States was a world leader for a long time. Basic, essential technologies like the transistor came out of U.S. efforts. The internet came out of DARPA collaborating with universities to make a nuclear-resistant computer network. Now, AI technology is led by United States software combined with both U.S. and Taiwanese hardware. Other things like the Human Genome Project, solar power, and, going further back, nuclear energy and space technology were all either led or conquered by the United States.

In short, the U.S. government and private companies based here were forward-thinking and forward-leaning enough to see vast untapped potential in these technologies before they came and invested in making them happen in the U.S first.

But, one technology we managed to miss out on was batteries. Several key things in batteries were invented in the United States and Europe, but the United States government and private companies simply didn’t invest big in developing material mining, cell production, and everything else to be a big power in batteries. Now, it’s not just EVs, but also energy storage to accompany renewables (eliminating intermittency), drones, mobile devices, and many other high-change and disruptive technologies that are powered by batteries.

There are obvious exceptions, like Elon Musk, but as a whole, the United States just didn’t take battery technology seriously enough to get an edge or even compete very well. On the contrary, the Chinese government did see the technology’s potential and invested heavily in battery production. Then, the government and companies in China invested big money into further research, and they are building the next generation of battery cells with even better performance, density, and durability.

At the end of the thread, Noah explores two possible causes, and they’re both valid, but they deserve a lot more exploration.

Oil Companies

We have to keep in mind that the United States had much cheaper access to oil during the last 20–30 years. Sure, there were notable exceptions when oil prices spiked, but for the most part, improving oil extraction technology meant that instead of paying $6–9 per gallon for fuel from OPEC countries, U.S. pump prices stayed low enough for people to not feel a great need for alternative fuels. Government and industry were also hesitant to invest much not only in EVs but even hybrids until after 2010 because of cheap fuel and sufficient energy independence.

But, there’s more to this than leapfrogging or low prices. There was a lot of manipulation by oil companies behind the scenes to keep battery technology from becoming important to transportation and everything else.

One good example is what happened with patents for nickel-metal-hydride (NiMH) batteries. Prior to lithium-ion technology taking the industry over, that battery chemistry was the most promising for both durability and sufficient density to build a decent EV. A few EVs were built with those battery cells, but they mostly appeared in hybrid vehicles like the Toyota Prius. Why? Because Texaco bought the patents from GM and then Chevron bought them from Texaco. They then went to court and stopped the production and even the repair of EVs powered by the technology.

With EVs basically dead in the United States (due to this and other factors explored in Who Killed The Electric Car?), interest in manufacturing EVs and coming up with supplies for them failed, followed by a lack of interest in developing better battery technology at the kind of scale that would be needed for mass EV production — until Tesla managed to move on to lithium-ion cells.

We’ve seen all sorts of other rent-seeking and sabotaging behavior from oil interests. Like many major corporations, these companies make big donations to politicians on both sides of the aisle and spend lots of money on buying media, conducting influence operations, and more. By allowing these moneyed interests to control government, we’ve put our own country at risk.

Exporting Manufacturing To China

Another mistake was the Global War on Terror. In the wake of 9/11, United States leadership got so preoccupied with fighting in the Middle East that other geopolitical priorities fell through the cracks. Instead of being concerned with the possibility of near-peer or great power warfare, the United States decided to go all-in on invasions, nation-building attempts, and curtailing what civil liberties it could while chasing a nebulous enemy and unclear goals.

Relations with China were tense throughout most of the 1990s, but after the 9/11 attacks, things changed rapidly in the United States. Instead of worrying about moving manufacturing overseas and other issues in Sino-American trade, securing China’s cooperation in Afghanistan became much more important. This put China in a much better position to bypass skeptics in the Bush administration and gain membership in the World Trade Organization.

This, in turn, led to a big rise in Chinese contract manufacturing. Consumer electronics that had previously been predominantly coming out of Taiwan and Japan even shifted to China. Batteries weren’t considered the most important part of portable electronics, but the manufacturing of them shifted along with the rest of the laptop, phone, and later smartphone. 

Combined with disinterest in manufacturing in the United States, oil companies intentionally sabotaging hybrids and EVs, and cheap fuel, everything basically went to China.

Final Thoughts

There are, of course, other factors like the effects of the 2010 rare earths embargo on Japan, car companies that didn’t want to make the shift, and the hydrogen scam, but these two factors really led the way to Chinese dominance in the battery industry. 

Sadly, even the expansive changes contained in the Inflation Reduction Act and Bipartisan Infrastructure Law really aren’t enough to turn the tide. Much more is needed to get not only the United States but also other democratic countries back on track. 

Featured image by Aptera.