The electric Chevy Volt plans to use Lithium-ion batteries for its debut.

After decades of static growth, the battery industry has garnered new attention as the next generation of electric vehicles (EV) inches closer to hitting the market. Last year, both Tesla Motor Co. and ZAP announced plans to release all-electric sports cars by 2008 [see “Tesla Motors reaches mass production,” sustainableindustries.com, April 2007] while auto giants, including General Motors Co. (NYSE: GM), Honda Motor Co. (NYSE: HMC) and Ford Motor Co. (NYSE: F) made strong promises to release plug-in hybrid electric (PHEV) models within two to five years. Such promises, along with the U.S. Department of Energy promising to pour $20 million into battery research and development, could further spark the battery industry in 2008.

While storage, followed closely by low cost, is a battery’s primary goal in laptop computer applications, safety takes top priority in cars. Cobalt, which is typically a component of Lithium-ion (Li-ion) batteries, caused various models of Dell, Sony and Apple laptops to catch fire in 2006.

Concerns over the safety of cobalt, coupled with the European Union’s Restriction on Hazardous- Substances directive, have led companies such as A123 Systems, Altair Nano and Saft to research alternatives to cobalt in the manufacture of Li-ion batteries. Iron-phosphate turned out to be the agent for change.

While cobalt provides for better storage capacity, ironphosphate eliminates the thermal runaway problem that causes combustion, and supports higher current, which translates to greater power. The first products to use the new generation of Li-ion batteries were power tools, laptops and other consumer electronics.

Throughout 2007, auto companies began rolling out concept vehicles with the new generation of Li-ion batteries. But is the technology at the point where car manufacturers can guarantee the battery for 150,000 miles or more? “With some, yes; with others, no,” says Malcolm Bricklin, founder and CEO of PHEV company Visionary Vehicles. He says ion batteries are ready and lithium batteries are not. While the safety issue has been adequately addressed, he says, the reliability issue has not.

GM, which has partnered with A123 Systems to provide Li-ion battery packs for its Volt plug-in, announced at the 2007 Los Angeles auto show it was closing in on mastering Li-ion technology and the Volt would be road-ready by 2010. Toyota, which is currently using a nickel-metal-hydride battery in its Prius hybrids that dates back to 2004, has not been as publicly optimistic about Li-ion batteries, recently stating safety concerns would delay its introduction of a Li-ion-powered Prius until 2011.