As demand increases for electric cars and mobile computing devices, and longer, uninterrupted usage between recharges becomes more important, it is vital for batteries to be energy-efficient and smaller in size. However, according to her comment, achieving these goals is difficult due to the limitations found in current battery tech. If these hurdles are cleared, it will be a profitable, important development for investors in battery stocks.
All electrical batteries work in the same way: they rely on the chemical reactions of reduction and oxidation that occur between materials. The reactions occur in a sealed container, where electrons flow from the cathode to the anode. The electron flow causes electrical potential, which creates a current if a circuit is completed. Consumer batteries rely on technologies that are not conducive to more resource-intensive applications.
Rechargeable batteries work in a similar way, but they also allow the reduction and oxidation reaction to flow in reverse. Most rechargeable batteries sold today are LiOn (lithium ion), and they have solved many of the problems inherent in older rechargeable batteries, but are more expensive. The goal of today’s technology is to build a battery with the performance of a LiOn unit, but at a lower cost.
Investing in Battery Tech
If or when battery tech goes in a more promising direction, it will certainly reduce the cost involved in the production of consumer electronics and electric vehicles, such as those made by Tesla. The company recently announced the construction of a super-factory to not only build more cars, but to produce LiOn batteries in-house (in a collaboration with Japanese company Panasonic). By taking a hands-on approach to the battery production issue, Tesla might have found a good way to garner investment exposure to battery tech and electric vehicles.
The Final Word
In the modern era, batteries have many uses—and as electric cars and mobile computing devices become more prevalent, they will become more vital to everyday life. When something becomes essential, companies look for ways to cut the cost of production, which, in turn, makes things less expensive for consumers. If something is more cost-efficient for the end user, more people will buy it, and companies’ profits will increase. That means more money for shareholders.