The Battery Race: A Conversation with Bob Galyen
This podcast is also available as a video on Youtube
This week, we recorded the podcast at the Energy Disruptors: UNITE conference in Calgary. Our guest, Bob Galyen, is one of the top executives in the battery energy storage world and the former Chief Technology Officer of CATL. He now serves on boards in the emerging U.S. battery sector and owns Galyen Energy.
Battery technology has advanced significantly over the past decade, enabling EV adoption and backing up wind and solar power generation. New battery chemistries promise even greater utility, including longer duration, faster charging, and lower costs.
In their conversation with Bob, Peter and Jackie explore a wide range of topics, including new battery chemistries and Bob’s five golden rules of electrification: safety, performance, lifetime, cost, and environment. They also discuss the geopolitics of batteries and China’s dominance in the sector, including how the Chinese government supported the battery industry’s development. The conversation contrasts China’s approach with that of the United States, which is developing a domestic battery industry to reduce reliance on China for these critical materials and technologies.
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Episode 339 transcript
Disclosure:
The information and opinions presented in this ARC Energy Ideas podcast are provided for informational purposes only and are subject to the disclaimer link in the show notes.
Announcer:
This is the ARC Energy Ideas podcast, with Peter Tertzakian and Jackie Forrest, exploring trends that influence the energy business.
Jackie Forrest:
Welcome to the ARC Energy Ideas Podcast. I’m Jackie Forrest.
Peter Tertzakian:
And I’m Peter Tertzakian and welcome back. Well, as you can see from behind me, we are in studio, but in actual fact, this is a preamble session where we are going to be talking about batteries. And the reason we’re talking about batteries is that we have a special guest at the Energy Disruptors Conference, which it will be held on September 28th. And we are going to be interviewing on stage Bob Galyen. Bob’s a big name in batteries. He was the chief technology officer at CATL, the world’s largest battery manufacturer. And now he’s involved in advising, not surprisingly, other battery companies. So we’re really looking forward to it.
Jackie Forrest:
Right. And there’s lots to talk about when it comes to batteries because they really are the key to energy transition. They’ve massively improved in the last decade. And if they improve more, I think there’s more opportunity to displace natural gas and oil because if their utility could increase, then you can use them more for backing up renewables or for transportation, not only light duty, but heavy duty. So I’m really excited about the conversation.
I wanted to go over a little bit of background. One interesting thing about Bob is he was working at CATL when China really didn’t have much going on with batteries. And now their companies are some of the largest producers of batteries in the world. I think they’re producing something like 80% of all batteries that are produced in China today. And they had a real deliberate process for supporting the industry, which is what the Americans are trying to do right now.
Peter Tertzakian:
Right.
Jackie Forrest:
So I’m interested to talk to him. When you look at the policies that they have in the US, does he think that the domestic industry can get going the way it did in China?
Peter Tertzakian:
Yeah, it’s going to be great because it also intersects with a lot of the geopolitical discussions that we have as it relates to things like state capitalism, where the state has backed the development of corporate initiatives like battery with the expressed intent in China to dominate the space as it is done with solar panels and of course by extension electric vehicles and all sorts of other key and vital inputs into industry. So it’s going to be a fascinating discussion, but this preamble serves to give a little bit of a background into battery speak. And actually one of the things to recognize, I mean, we’ve been talking batteries several years over this podcast and saying this is batteries, you got to watch it. And not surprisingly, the costs have come down. So they’ve come down pretty significantly.
Jackie Forrest:
They have, right? And it really depends on what you’re talking about. So we will be talking about chemistries on the podcast. So when people talk about lithium ion batteries, the dominant chemistry is the nickel, manganese and cobalt ones, but they’re quite expensive. And so there’s new chemistries and one called LFP, lithium iron phosphate. And actually CATL was a real leader in bringing that out. And it had some disadvantages for electric vehicles initially, but they continue to innovate and they’ve actually gotten to be a bigger and bigger part of vehicles. So the average cost of batteries is down about 93% since 2010, but these LFP battery packs are 25% cheaper than the average. And so they’ve really started to take off.
So we’ll be interested in learning a little bit more about the history of them coming out with that chemistry, which wasn’t really viewed to be very good utility for electric cars, but it’s turned out to actually be pretty good and continues to improve. And then we want to talk to him about what’s coming. There’s still other game changing technology like solid state, even sodium ion batteries that could potentially be cheaper because the advantage of the LFP is it’s cheaper materials and yet there’s even cheaper materials that could come and reduce the cost for it.
Peter Tertzakian:
Yeah. And I think innovation’s like the solid state. I don’t know if you remember back probably four or five years ago in the early 2020s, we were talking about watch the space, but that the notion was it’s probably going to be a story in 2030. Well, guess what? 2027 is not too far away on the calendar flip. So we’re getting close to 2030 and there’s all sorts of innovations going on in terms of these battery chemistries. And solid state’s a big one because it also offers much larger range, potentially thousand plus kilometers on an electric vehicle. And also because as its name implies, solid state, there’s no liquids in the battery. So there’s no freezing. You don’t have to keep the battery heated, use the energy within the battery to keep the battery heated so it doesn’t freeze at minus 20.
Jackie Forrest:
It also has a lot of safety advantages because the pictures of the Tesla going on fire, it doesn’t have the same-
Peter Tertzakian:
Characters.
Jackie Forrest:
… issues with fire and stuff like that too. So that’s really important. I also think what’s really interesting is the stationary batteries. Solid state is maybe expensive for stationary applications. There’s lots going on with even cheaper materials for stationary because you don’t necessarily need density. You got lots of space beside a power plant.
Peter Tertzakian:
Right.
Jackie Forrest:
And so there’s iron oxide batteries that we want to talk to him about as well that might be better. And then these data centers have unique requirements too.
Peter Tertzakian:
Right.
Jackie Forrest:
And so are there different chemistries for them? So lots going on. We’re really excited to have that conversation.
Peter Tertzakian:
Yeah, no, it’s going to be really fascinating because you look at the evolution of batteries and I can’t help but sort of think about the history. These sort of batteries started out in your watch, like watch batteries in the 1970s was the first electric watches. And then as they started to scale up, as you started to see batteries and model airplanes and things like that, and then all of a sudden they’re in vehicles and in your gardening equipment, your lawnmower and now-
Jackie Forrest:
Your electric bike, they’re everywhere now.
Peter Tertzakian:
… your bicycle. And then of course, more recently being in the last 10 years, now we’re talking grid scale batteries, which need different type of chemistries depending upon the application. And so it’s going to be interesting to talk with Bob about what’s next in each scale category.
Jackie Forrest:
For sure. Okay. Well, let’s switch to the conversation.
Peter Tertzakian:
Let’s do that. I think we’re ready to go and we’re delighted to have our special guest who, if you missed it, had an excellent presentation about an hour ago. We’re delighted to have Bob Galyen. I think he is probably one of the most under-acknowledged people in the world of energy. He was the number two employee of CATL Batteries and we’re going to talk about that. CATL Batteries now provides 39% of the world’s batteries. It is just a juggernaut in China in terms of battery production and it’s just started in many ways I think we’re going to hear. So welcome Bob.
Bob Galyen:
Well, thank you for inviting me. This is going to be fun. Ask the tough questions, please.
Peter Tertzakian:
Okay.
Jackie Forrest:
We’ll start with an easy one. Tell us about your shirt. It says BBE.
Bob Galyen:
Big battery energy. This is something that was designed by the conveners of this event. And they asked me last night, “Please wear it.” And I thought it was a good testament to what they’re trying to get across because many people don’t understand how important battery technology is to our present day society. And big battery energy is not something to sneeze at because nearly everything we touch or feel today or work within our home or our businesses is powered one way or another by a battery, whether it’s our cell phone, a pacemaker, a defibrillator or an electric car like I drive or your grid network. Many of the grid networks across our great nations, both Canada, US, have a lot of batteries hanging on the grid. So big battery energy is a really important theme, if you want to call it that, that this event is holding.
Peter Tertzakian:
Yeah, really. Listen, Bob, just by way of background, you were the number two employee at CATL Chinese company, but I’m not sensing a Chinese accent here. Maybe for the benefit of our audience, you can tell us where you hail from. I’m sensing Texas or the Carolinas or something, and how you made it over to China to be one of the chief technology officer, one of the biggest battery companies in the world?
Bob Galyen:
Well, I reside in Indiana, so I might have just a little bit of a southern draw, Peter, but growing up and living in central Indiana, I had not even been out of the state of Indiana until I was 18 years old. But in my career, I’ve been fortunate to travel to 54 different nations around the world and participate with some of the brightest minds on the planet. I mentioned in my speech, a couple of different guys this morning, Dr. Jonas, had helped me with the five golden rules of electrification. That’s, in my opinion, it’s immutable. It’s almost like a religion. And then you talk about people that I’ve been privileged to work with on the EV1. I mean, some of the most bright minds that worked on that electric vehicle was-
Peter Tertzakian:
That was the General Motors EV1. It’s the 1990’s.
Bob Galyen:
General Motors EV1.
Peter Tertzakian:
Yeah.
Bob Galyen:
Well, I was assigned in 1989, so I was one of the first engineers assigned to that project. And it ended abruptly in about 1997 when they crushed all the cars because General Motors took advantage of the CAFE requirements being repealed by the US government. So from my standpoint, it was totally a business case thing. It wasn’t the book that was written about, ‘Who Killed the Electric Car?’ And the movie, “Who Killed the Electric Car?” There was a lot of embellishment in both of those, right? But the real fact was that General Motors could not make a profit off of that car if they built it. That was clear and simple. So that’s why they killed the program because it was a two-seater. It was only good for approximately 100 miles range with the lead acid battery, maybe a couple hundred with a nickel zinc battery in it or a nickel metal hydride battery in it.
So I think the key points here guys is that you just couldn’t get what people wanted out of it, so they killed the program.
Jackie Forrest:
Okay. But then years later come new technologies and new chemistries that work better. And so we have many electric cars today, but maybe we’ll back up. Tell us, you joined CATL in 2012 and basically not a lot of batteries come out of the company then and now they’ve grown, you just said in your keynote to 39% of all the batteries produced in the world are coming from one company. So China did a lot to establish that industry. And of course we’re going to get into it. The US is trying to do the same today. But just briefly, what were the big things that created these huge companies that were really so small just a decade ago and they took over established players like the Koreans and the Japanese that were already doing that kind of work?
Bob Galyen:
Well, when Robin Zeng approached me, I was in Xinjiang for a lithium battery conference to just give a presentation about what were we doing at SAE International. And for those in the audience that don’t know who SAE would be, it’s the world’s largest professional standards organization. If you flew here on an airplane, 99% guarantee you that the standards on that aircraft were written for an SAE standard. Also, the battery technology that goes into cars, almost everything that you touch or feel in a car is driven by an SAE standard today because they are world renowned for global standards. And last time I checked, there were over 200 different countries in the world that use SAE standards.
But I was there giving this presentation, this young man walked up to me after I gave my presentation. He said, “Bob, my name is Dr. Robin Zeng. I’d like to meet with you.” I said, “What do you want to meet about?” Said, “I’d just like to come have dinner with me.” I said, “Okay.” So I went to dinner with him and there’s 56 people in the room. And I looked at him, I said, “Robin, you told me you’re inviting your engineering managers.” He says, “Bob, these are my engineering managers. I left the vice presidents and directors back at the plant because I wanted those guys to remember how to run the factory if something happens to all these guys and me.” I said, “Okay.”
So I was quite honored Robin would bring that number of people with him. And he told me later, every one of them had read an article that had been written about me in the lead acid world that I had done the EV1 and that I’d started so many different factories and became the chief engineer at Delco Remy division at General Motors. I said, “Well, why do you want me to work with you, Robin?” He says, “You know how to build big batteries in good quality. We build these little bitty consumer electronic product batteries that go into cell phones and laptops. I want somebody that knows how to build big things.” And that was the very beginning of when I was asked by Robin to come and join him in China.
Peter Tertzakian:
And that quality is so important and relates back to the SAE because quality also overlaps heavily with safety. Now in your presentation about an hour ago, for those who missed it, you talked about the five golden rules of battery and battery adoption and the complexity of manufacturing batteries in high volume with high quality. Talk about those golden rules because I think it’s really important for the audience to understand, because it also overlaps with my presentation that I gave earlier this morning, which talks about how it is that a state backed organization in China can really get not only competitive, but comparative advantage in the world.
Bob Galyen:
Yes. Well, for the audience that wasn’t able to hear, it’s the five golden rules of electrification. Number one is always going to be safety. Safety will always be number one because it’s the preservation of life and health that is most, most important. I can remember about the third or fourth year that I was the chairman of The Battery Show in the US. This would be my 15th and last year of chairing The Battery Show. It grew to 22,000 people in the last couple of years. It’s a big show. And there’s some guy from the media that was sitting in the back of the room after I give him my speech about the five golden rules. He stood said, “Bob, you’re all washed out.” He says, “Everybody knows cost is more important than safety.”
I said, “Okay, let me paint the picture for you. You put your wife in the backseat with your brand new baby, with your grandmother, and one of your other children is sitting in the front seat with you and you have a serious car accident. You are trapped in your car and your car catches fire. Now you tell me whether safety is more important than cost in that event or not?”
He had to get up and leave the room because the audience cheered. They said, this guy’s nuts. He doesn’t understand. So the preservation of your own life, your family’s life, and for the design engineers like myself that had to build electric vehicles, you lose sleep every night over making standards and creating designs that save people’s lives because you’re putting a whole bunch of electrons into a storage media that if you have an accident, if there will be a fire, you’re going to be in trouble, right? So safety will always be number one, but close to safety is performance because performance metrics all have elements of safety. You’re talking about energy performance, power performance, cold temperature performance, hot temperature performance, shock and vibration.
Also, there’s even standards around acoustic noise, NVH that go into making a battery pack so it doesn’t make some loud tampanium sound as you’re driving down the highway. So there’s a lot of different performance metrics, but the next one in order is life because life expectancy is something that’s a part of the total cost of ownership of a product. If the product is too short, such as a battery pack that goes into an electric car, it’s like 40 to 50% of the cost of the electric vehicle. You’re going to have to pay for the battery pack twice. You don’t want to do that. So all the battery manufacturers are typically trying to make the batteries last as long as a car, if not longer.
And then the fourth element of the golden rules is the cost. If you can’t afford to buy the product, you’re not going to buy it. So you make the cost as low as you can that is affordable for you to be able to make money in building the batteries in the first place. And the fifth one was something that was really pushed on me by Washington and Beijing at the time when I was developing these golden rules. And they said, “Bob, you need to have an element of environmental in it because all the way from the mining operations, getting cobalt, nickel and some of these noxious chemicals out of the ground and processing it and then putting it into the battery is remarkably difficult. And to do it safely is even more difficult.” So the element of environmental goes all the way to recovery of the final battery and recycling effort that goes back into recycling.
So I’m sorry it took so much time to go through those five golden rules, but they’re really, really important for society to follow those golden rules because if you don’t, it’s going to cost you financial ruin.
Jackie Forrest:
Okay. Well, I’m glad you’re thinking about safety. Now, CATL moved early to that lithium ion phosphate technology when it maybe didn’t have the performance. It had the cost advantage, but it didn’t have the performance. But I know they’ve innovated a lot. I think they’re on their fifth generation now. So I think you were still there at the firm when those decisions were being made. Why did you decide to go for that technology when it maybe didn’t have the performance? It’s turned out though that it’s working in electric cars, but people didn’t think that at first.
Bob Galyen:
Well, during my speech earlier, you heard me talk about 180,000 electric buses in the major metropolitan provincial cities of Beijing, Tianjin, Shenzhen, Shanghai. And the reason for that, those buses all had lithium ion phosphate in them. The primary reason was the government made a decision for all the battery manufacturers in the early days of electrification in China because they knew that these LFP batteries were safer than an NMC, even though the NMC would give you better range, better performance per unit mass, but they chose to go with the LFP because they were much safer, they lasted longer and they worked really well.
Today’s modern era of LFP is even much better than they were back then. When we first started, we were looking at 140 to 160 watt hours per kilogram at the very beginning. Then it went up to 180, then it went up to 200. Now they’re up in the 240s to 260s on some of these LFPs.
Peter Tertzakian:
Yeah. So I mean, for the benefit of the audience, the LFP is lithium, F is ferrous iron, phosphate and the NMC nickel manganese cobalt. And so there are different chemistries for different applications. So for vehicles, because you want to be able to have the power density, when you want to accelerate, you can pull out of the battery the amperage quickly, is different say from a backup battery for a grid, is different from a watch battery or a flashlight battery. So talk about the chemistries that are emerging for the different applications. And I think we’re particularly intrigued with the larger scale applications that are coming.
Bob Galyen:
Well, clearly the LFP is going to be roughly 80 to 85% of all electric vehicles here in the near future, but there’s also some applications that are using the nickel manganese cobalt oxide technologies. General Motors and Ford have been talking a lot about the LMFP, which is a new generation of LFP, except it’s got manganese embedded into that organic structure. I won’t spend a lot of time trying to explain that. But there’s just new technologies that are merging, but there’s some out there on what I call the bleeding edge of technology that are just coming in and some of those folks are sitting in the audience today.
Peter Tertzakian:
Yeah. I mean, talk about the individual countries and their access to some of these critical minerals, because that is also dictating the battery chemistries that they may pursue. For example, cobalt, which is found in Africa and other places in quantity. But again, further to what I was talking about this morning in terms of comparative advantages and what you are naturally endowed with in a country, you will chase a chemistry that is more conducive to giving you an advantage versus having to import the chemistry.
Bob Galyen:
Right. Well, clearly different countries have different raw materials, but one thing China has that the rest of the countries don’t have, and that’s processing. They have processing capacity. Today, between 69 and 99% of all battery materials come out of China because they have the processing capacity. And that’s one of the key things that’s missing in Canada and the United States is processing capacity. We just don’t have any capability of producing large quantities of the high purity materials it takes to make batteries. And this is one of the things that people miss is purity levels in batteries is akin to God. You got to have really, really pure materials that go into making batteries because you get these funny side reactions that create chaos in the battery, either a shorter life or some kind of funky failure mode that causes the battery to deconstruct itself.
Jackie Forrest:
But there’s new materials now too, the sodium ion, and I know that Form Energy has an iron air battery. So these are things that are abundant. Are these the kind of maybe the batteries that will take off here in North America? We’re going to get to the geopolitics of batteries, but there’s this idea that we want to have to be more independent, not so dependent on China. Do you think those batteries are going to really make a big market share 10 years from now?
Bob Galyen:
It depends on the application. It’s totally dependent upon application needs. Sodium ion battery is a good battery. It has a big advantage over lithium ion in one particular area. It’s temperature performance. It’s really good on the cold temperature. It’s very good on the high temperature, but its energy density is less than lithium. So depending upon what do you want to use it for. I want to put it out there in the cell phone tower in the northern part of the Yukon somewhere, sodium ion’s going to win out over lithium any day because the electrolyte system and the lithium battery is going to turn into a solid chunk of wax, right?
Lead acid has been a good mainstay in those kind of applications because it’s great on cold temperature performance. Now try putting that same lithium ion battery out in the hot desert of Saudi Arabia. It’s going to cook out there. You get up to 60 degrees centigrade out there in the desert, those batteries are going to die miserably in a very catastrophic way. Sodium ion is just going to sit there and continue to work fine, just like a lead acid battery. So to answer your question, it’s very much application dependent what kind of battery you need for that application.
Peter Tertzakian:
I want to get back to the processing comment because it’s so important and I want you to expand on it from your talk this morning. So when you say processing, it’s all the way from the raw ores that are mined into the high purity elements and then the chemistry, and then taking all of that and putting it into the assembly lines that have extremely high tolerances, micron level tolerances or more to be able to create a safe, reliable, durable battery with long duty cycles, et cetera. That whole supply chain, China made a conscious effort to basically do from soup to nuts, right? And you said in the other room that that has given them a 15 to 18 year advantage, which is quite staggering today over any other country in the world.
Bob Galyen:
It’s remarkably difficult to go back and reconstruct everything that we did. You heard me mention there were 3,600 control points when I retired. Now it’s 3,854 control points in making a cell. So you think about what goes into that. The bill of materials, most battery manufacturers have between 75 to 100 different bill of materials that go into making a lithium ion cell. It depends on what type you’re making and what the different materials are that go into your particular construction.
I specifically went through every bill of material with my engineers and we reviewed every critical characteristic, every packaging characteristic. This is where a lot of engineers fall short. You have to understand your material properties before you can put them into the battery. Then you add in the processes, Peter. You make sure that that process that you’re building in the factory is compatible with the material that your materials engineers specced out because every process has a very particular or very characteristic of its own for controlling the parameters for those materials that go into the process flow through the entire value chain of making a cell.
You’ve heard me mention so many times today, Peter, that quality is so, so important. There’s an x-ray of every cell winding that goes into a CATL, stored somewhere in China. In that x-ray, we took a vision of that x-ray and there’s somewhere around 27 to 29 characteristics that were measured from one picture, one x-ray for every cell that’s ever been made in that company. All the way through and including all the key and critical characteristics have been packaged into a data set that resides on three different servers somewhere in China. It’s stored redundantly three times. So if there ever is a catastrophic failure, we can always go back and retrieve that information. But are we paranoid about quality at CATL? Absolutely. That’s why they’re the only company in the world today of a spouse that they’ve got a parts per billion failure rate.
Jackie Forrest:
Okay. So you painted a picture of how hard it is to manufacture batteries and all those different steps. So let’s come here to North America, specifically to the United States. China has scared people in DC by restricting access to some critical minerals, stopping the access to the magnets. And so everyone in DC is like, “We need to do all of this here.” And they’ve done things like put in production tax credits. So every battery that gets manufactured here in the United States, there’s a fair amount of subsidy for that. They’ve done deals with groups like MP Materials where they have got 10 year guaranteed price. They give them debt financing, they take an equity position. Is that enough? Are they anything close to what it’s going to take to kind of reestablish what China has?
Bob Galyen:
Not even close. As I mentioned in a speech a while ago, one of the biggest things that we’re missing in the North American continent is private equity investment. We need a lot more money invested into battery technology and most companies and most individuals don’t want to invest in something that they don’t get a quick return. The Chinese are more patient. People put money into the companies over there that they knew they would get a return on investment eventually.
So it really, really frustrates me that the North American governments have not put enough money into battery technology to support a robust and thriving battery economy because it takes a lot of money. A single battery manufacturing plant in the early days were a minimum of $2.2 billion. That’s a lot of money. That includes roughly 100 plus million dollars in just doing the qualification of getting into the plant, including all the certificates for the land grants and all the different types of surveying and things like that.
But then you start adding in the capital equipment. Capital equipment alone is somewhere between 800 to $1.1 billion depending upon what kind of price break you get on your volumes that you’re buying. So when you talk about this, this really is a hot button for me because the governments in Canada and the United States don’t have a clue what it takes to do a good production program.
Jackie Forrest:
Well, and you talked about the equipment because just recently they’ve made some new rules in the United States to get that, they call it the 45X, that production tax credit, now you have to prove that you’re not using any Chinese technology, not even in the equipment you buy to help manufacture. That is a huge leap to not be able… Who else in the world is making the equipment that is needed to manufacture these things? Is it almost impossible now with that requirement for US manufacturers?
Bob Galyen:
Well, during the lunch session next door, I mentioned, you used the word leap. I was an old high jumper and I used Valery Brumel, who is a Russian high jumper, I used his training techniques to become a world-class high jumper, but there was always one guy that beat me and he was a world record holder. And you have to look at this as a competition. China won out because they were willing to put the time and the effort into doing it right. Building a quality manufacturing operation is not simple. It’s very complex. And by excluding other people’s technology that they’ve developed over the last 30 years is a big mistake. Why not learn from what the Chinese have done? They are making great batteries.
In my speech in Washington in June at the Benchmark Mineral Intelligence, I made this comment. We had a minimum of five senators and House of Representatives. In the crowd, I said, “Guys, you have to wake up and understand that we need advanced battery manufacturing for our national sovereignty.” I heard somebody speak about this this morning in the keynote opening address. In order to maintain your national sovereignty, you need technology that will fuel your military. Today, the United States and Canadian militaries are very dependent upon Chinese cells.
Peter Tertzakian:
Getting back to the 18-year advantage that you talk about. Is that for only certain types of chemistries or is there a frontier of next generation chemistries where North America, United States, Canada, other countries can leap into because there’s all sorts of new chemistries even emerging?
Bob Galyen:
Peter, it’s almost chemistry agnostic. It’s the machines that we need. And where that 18 years came from, just for the crowd’s understanding, and I mentioned this during the lunch break next door, I took Dr. Shawn Murphy, one of the most intelligent men I think I’ve ever met, and he runs a company out in Salem, Massachusetts making acoustic sensor technology that measures defects in batteries. I took him through the Z plant at CATL in China, and Shawn made this comment. He said, “Bob, you lied to me.” I said, “What do you mean I lied to you?” He said, “You told me we were only 12 years behind.” He said, “Bob, my estimate, we’re 18 years behind because the advanced electronics and the artificial intelligence that this company has already embedded into the machines is light years ahead of us. It’ll take us at least a decade just to develop those interfaces that I saw in the plant when I walked through it.”
So Peter, it’s not a matter of arrogance or self-infatuation when I say this, we are way, way behind. And it’s about the machines and the software that goes into the machines and the sensor technology. AI is absolutely worthless to you unless you got the right sensor technology because you need the right kind of feedback from the machine sensing technology to give the machine the direction it needs to make the product correctly based on the parameters that the engineer has given the machine to run.
Peter Tertzakian:
Right.
Jackie Forrest:
Okay. Well, let’s talk about back to North America. You’re making it feel like I already knew it was hard, but it’s even harder than I thought for us to develop our own battery systems here. But one other thing that the Chinese did is they incented the use of electric cars. And here in North America, we’ve kind of gone backwards. We’ve just actually come up with new EPA regulations that the manufacturers don’t need to make a lot of electric cars now to meet the requirements. Here in Canada, the same thing. We’ve adopted sort of softer rules that are going to slow down the adoption of EVs. Is that a mistake? Do you need that requirement so that the companies are motivated to make the batteries, build the batteries here?
Bob Galyen:
Well, Jackie, it goes back to something that was told to me by Premier Li Keqiang standing in the Great Hall in 2019. I was honored to come back to the Great Hall seven times to give speeches on energy, battery technology and so forth. But Premier Li stood toe to toe with me and he said, “Bob, you have to understand there was a motivation why China wanted to electrify.” He said, “The motivation was to build great battery systems so that we could cut down on the pollution in our major cities. We were losing 1.3 million people a year to respiratory ailments, people dying from respiratory ailments.” He says, “You can’t imagine how many millions of people were sick beyond those 1.3 million people. You have to understand we’re a socialistic country. Our medicine is paid for by the government. You can’t imagine the tax load in our society based on healthcare that we had to pay for the people getting sick.”
So a lot of people think that there was some kind of a master plan for creating the battery as the device that they were going to beat the rest of the world at. They had to do it for self-survival for their own people within their own cities. So it was a strategic plan to support electrification because they knew they had to do it to save people’s lives.
Peter Tertzakian:
So I want to just talk about the trajectory of where we’re going. And you had a great slide there where you took the battery technology back 100 years and then you fast forwarded to Sony who started making laptop batteries and camera batteries and what have you. I’ll take it back to 1960s, which was not on your slide where the first Quartz watch came in, the Bulova Accutron and they had a little watch battery. But my point is that there’s this progression of small batteries and they get bigger and then they go into laptops and they go into garden tools and lawnmowers and then cars. And then now you spoke in the other room, I was fascinated by giant backhoes. You can talk about that too. But okay, we’ve got the grid scale batteries. Are we going to see batteries in cruise ships in 10 years or maritime? How far is this going to go?
Bob Galyen:
They’re already there.
Peter Tertzakian:
What about airplanes?
Bob Galyen:
They’re already there. They’re using batteries in cruise ships. They’re using them in freighters. And most of these electrical systems are driven by the need for the side thrusters. They use the electrical system to use the side thrusters on the ships for maneuvering, management inside ports is very difficult. And electric drives are really good.
Peter Tertzakian:
Yeah, because they have such precise control.
Bob Galyen:
Yes, exactly.
Jackie Forrest:
Are we going to get ships that are only driven by batteries? Do you sort of see that in the future?
Bob Galyen:
Well, they’re already in Europe. There’s lots of ships.
Peter Tertzakian:
The ferries.
Bob Galyen:
Ferries in Europe that are unmanned that go from port to port. It’s nothing new. It’s already existing today. It’s just a matter of it’s getting spread around the globe fast.
Peter Tertzakian:
And Tesla just, I think launched its truck. Was it a week ago or something like that? The big 18 wheelers.
Bob Galyen:
Yeah, they’re pilotless truck. Yeah.
Jackie Forrest:
But the 18 wheelers in China are out there quite a lot now, right?
Bob Galyen:
Yeah.
Jackie Forrest:
We’ve always talked about when batteries are better, then we can put them into heavy hauling, but it’s already happening in China.
Bob Galyen:
Well, it’s interesting. I had the opportunity to visit the AI center in Guiyang in China and it blew my socks off. This is back in about 2017, 2018 timeframe. I’m in this room and I’m looking at these boards. They could track every truck in the entire nation. And the reason that they’re tracking the trucks with the transponders is to know if there’s a flood or if there’s a natural disaster like a landslide or something, they can reroute the trucks around the natural disaster and save time and fuel. China still uses enormous amounts of petroleum fuel for their trucking industry, but they are able to track and trace these trucks in a way that they can reroute them around accidents and natural disasters.
Peter Tertzakian:
No, it’s fascinating how it’s all evolving, but you have to have the holistic system. You talked about that, right? It’s not just good enough to have the batteries, say in a backhoe, you have to have the electrical grid and systems to charge the batteries, right? It’s the whole thing. And I think that the countries are starting to adopt that system level thinking in the development of their infrastructure.
Bob Galyen:
I like the word infrastructure, Peter, because a lot of us don’t even recognize how extensively use batteries today in our society. I picked a few things on my charts a while ago during the speech, but you think about it, I can sit at my desk and I can see at least 12 devices on my desk that use batteries. I look around the rest of my office, there’s like 18 different devices in my office that have batteries, including these microphones that we’re talking from, the headsets that the guys in the back are wearing them. And almost every person in this room’s probably got at least two or three different batteries with them on their person at this time.
Peter Tertzakian:
Yeah. And maybe the clock that’s running out.
Bob Galyen:
Maybe the clock that’s running.
Jackie Forrest:
Yeah. Well, I have one quick question before you run out. We didn’t talk about solid state batteries. They’re going to have double the range or half the price and suddenly want to have 1,000 kilometer car. Do you think that’s going to happen? Toyota promised it in 2028. I know CATL is just talking about producing small scale next year. Should I hold off buying my electric car because in three more years I’m going to get 1,000 kilometer range car?
Bob Galyen:
No. I think it’s a bit of a funny story, but when people ask me if solid state battery is going to become real for the common use, I say it’s seven to 10 years away. I’ve been saying that for the last 10 years. And the reason for that, it’s about a seven-year cycle to validate a brand new technology through the automotive sector and get it in widespread adoption. The biggest problem right now is that the solid state batteries don’t meet three of the five golden rules of electrification. It’s not that they’re not safe. It’s not that they don’t meet all the performance metrics, but on the life, the cost, environmental, they don’t even know how to recycle these batteries yet. It’s a big deal for battery specialists like myself to see that they meet all five golden rules.
Peter Tertzakian:
Well, it’s amazing where we’ve come to. I can share with you and you’d appreciate this, Bob, that my dad used to say, “Hey son, we all got to go out and get some flashlight batteries,” because that’s what they were called. It was almost like one word because he used them in flashlights and that was about it. But look where we’ve come to. Thank you for sharing your insights. Bob Galyen, let’s all give him a round of applause.
Jackie Forrest:
Thank you, Bob, and thanks to our listeners. If you enjoyed this podcast, please rate us on the app that you listen to and tell someone else about us.
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