Recharging the Battery Market
Interdisciplinary research informs battery warranties and risk calculations
Battery warranty presented two challenges for the insurance market: chemically driven performance loss and scarcity of historical performance data. An interdisciplinary team at Lancaster provided new models to validate and improve prior risk calculations. Via a spin-out company, they introduced new ‘extended warranty’ products and made it more attractive to invest in the battery market.
Research led by Professor Harry Hoster and his interdisciplinary team into lithium-ion-battery degradation at LU’s Battery Laboratory (BatLab) enabled a new method of informing insurance risk calculation. Only mechanical fatigue and electronic failure had previously been considered but research demonstrated chemical-driven performance loss also needed to be included. These insights were commercialised through spin-out company Altelium Ltd bringing a new ‘extended warranty’ product to the London Insurance Market.
- Lancaster University (LU) spin-out Altelium Ltd founded in 2019, has 20 employees and raised investments worth £390,000 from its founding shareholders and £806,560 of research grants. Income from first customers Connected Energy and AMTE power has been £121,000 and given worldwide green energy initiatives, projected income by 2023 is £13 million.
- Backed by Lloyd’s of London, Altelium ensures energy storage containers based on used electric vehicle batteries. This represents a first of its kind globally and is a crucial milestone in the wider rollout of green technology.
- Insurance-backed extended warranty allows SMEs to offer their customers longer (eg five-year) warranties on their products. SMEs can only offer longer-term warranties when backed by an insurance company with sufficient capital. This warranty has already enabled SMEs such as Connected Energy, AMTE Power, Delta Motorsports, and Brill Power to enter the rapidly growing energy storage market.
- Connected Energy rolled out their first batch of Mega- Watt (MW)-level energy storage systems with an Altelium warranty and AMTE are growing their larger-scale cell manufacturing provision. Other clients expect to install several thousand second-life battery packs in the next three years, which could not proceed without the new warranty.
- Whilst private cars are typically parked 90% of their time, business-related vehicles are constantly in use. Cleaner transport enabled by these faster energy storage solutions would have a bigger environmental impact than the electrification of private cars.
“Through the creation of Altelium, the power of battery data can now be harnessed.”
UK Faraday Institution, 2020
“Critical for achieving an extended warranty that satisfies our customers’ needs.”
Connected Energy, 2020