TROY, MI – The lead-acid battery could be on the verge of a comeback.

Passed over for more advanced technology as auto makers looked to improve performance in hybrid and electric vehicles, first with nickel-metal-hydride and then lithium-ion battery formulations, lead-acid could see new life as vehicle manufacturers search for lower-cost solutions to meeting increasingly tougher U.S. fuel-economy regulations.

At least that’s the working theory of Energy Power Systems here, which is promising a new-wave lead-acid battery it says is a fraction of the cost of Li-ion but will deliver the power needed in many hybrid applications.

“I’m going back to the future,” says Subhash Dhar, chairman, CEO and founder of 18-month-old battery upstart.

Battery developers touting the next big breakthrough are nothing new. But Dhar, with 30 years in the advanced-automotive-battery field on his resume, comes with a pedigree that makes his pitch hard to ignore.

As president of Energy Conversion Devices’ Ovonic Battery, Dhar led development of the first NiMH batteries now powering Toyota’s Prius and other hybrids. He also served as president of Ener1 (later EnerDel), a Li-ion battery maker that supplied the Think EV before restructuring through bankruptcy earlier this year.

Dhar is listed as the co-inventor on more than 30 battery and fuel-cell patents.

Where the industry may have gone wrong – his past work included, he says, is in swinging for the battery home run that would trigger an overnight consumer migration into pure EVs.

“It was a noble thought. It was a good target to have…but not (to) drive the entire industry without paying attention to what is commercially viable.”

Now with the bloom fading from the rose – EVs remain prohibitively expensive for mainstream buyers, and between-charge ranges still highly limited – auto makers are beginning to focus on more modest electrification ambitions as a way to meet proposed 54.5 mpg (4.3 L/100 km) fleet requirements for 2025.

To achieve that mileage target, hybrid vehicles, accounting for just 3% of the U.S. market, need to gain wider market acceptance, and that won’t happen unless costs come down, Dhar says.

“It’s not the (fault of) technology,” he says of anemic hybrid demand. “We know the technology. We’ve commercialized it; it’s in nine of 10 hybrid vehicles today.

“But where we failed is the cost aspect of it. We haven’t really made a whole lot of progress on the cost front.”

Material costs are to blame, the Energy Power executive says, pointing to the rising price of cobalt at $44/kg and nickel at $11/kg, compared with a fairly steady $1.80/kg for lead.

“So all of the efficiencies we’ve gained in terms of yield, manufacturing processes, whatever volume we have, we’ve more than lost in ongoing increases in cost of (advanced-battery) materials.”

That, Dhar says, is creating an opening for lower-cost lead-acid for everything from micro-hybrid (stop/start) applications to mild-hybrid vehicles and on up to full plug-in hybrids.

The secret of Energy Power Systems’ battery is its physical design.

“We’ve changed the particle size, the morphology of the material, how we make the electrodes, their dimensions and thicknesses (and) how they’re assembled,” Dhar says.

It all adds up to a more efficient energy flow.

Conventional 12V car batteries consist of six 2V lead-acid cells standing side by side, requiring electrons to flow up one side of the cell and down the other and onto the next cell.

The EPS battery is a single unit that results in a more direct energy path, Dhar says. Cells are positioned in an interlocking pattern in a single-cavity configuration, similar to the way bricks are laid to create a wall.

“So you get rid of all these extra connections, these extra lead terminals,” he explains. “You reduce the weight (and) the (electrical) resistance.”

He likens the strategy to engineering a faster way to pump 500 gallons (132 L) of water.

“If you want to (increase the flow), you put in a larger pipe or you put in 100 capillary tube pipes – a bunch of smaller pipes. You get the same 500 gallons (flowing more quickly) by simply reducing the friction in thepath that water has to go.

“I’m oversimplifying it, but that’s the principle here: Change the particle size, change the porosity, change the microstructure, change the battery design.”

Dhar says the result is a battery pack with a power rating of 1,900 W/kg, four times the best lead-acid battery on the market and even bettering the 1,450 W/kg of NiMH.

“And I have not added any expensive materials (or) changed the fundamental low-cost structure of lead-acid chemistry.”

He pegs cost at $15-$20 per kW vs. $40-$60 for NiMH and Li-ion.

Dhar envisions minimal additional battery-pack weight from the use of lead, because less-volatile lead-acid doesn’t require the same thermal-management support as more advanced chemistries.

A Prius NiMH pack is about 70% batteries and 30% thermal management and electronics, he says. The equivalent EPS pack would take up less room because it is 90% batteries, 10% air circulation and electronics, Dhar says, and would be one-third the cost.

An application in a mild hybrid such as General Motors’ e-Assist powertrain would add just 4.4 lbs. (2 kg), he adds, and be less than half the cost of the Li-ion pack the auto maker uses.

For automotive markets, EPS will target applications that need smaller batteries (0.5-2 kWh energy) with high power-to-energy ratios and larger batteries with energy at about 3-3.5 kWh.

The larger units would be enough for a plug-in hybrid application with a range of 8-11 miles (13-18 km) – about equivalent to the Prius Plug-In.

For a longer-range rechargeable such as the Chevrolet Volt, a scaled down Li-ion pack could be mated to an EPS battery, a combination that would take up less space and be half the cost of the Volt’s current pack, he says.

EPS has kept a low profile until now, because the startup isn’t alone in pursuing new lead-acid technology.

The Advanced Lead-Acid Battery Consortium, for instance, now has some 70 members, including EPS. Potential competitor Exide Technologies is showcasing a lead-carbon battery for micro- and mild-hybrid applications in concept vehicles, for example, while others are working on combining lead-acid batteries with ultra-capacitors to perform similar tasks.

Dhar says his company has filed five patent applications and has another half-dozen in the works, but he believes once competitors see the EPS concept they’ll wonder why they didn’t think of the design themselves.

“If you look at it, it’s simple,” he says.

Energy Power’s operation here started with eight people a little over a year ago with backing from Townsend Capital. It now employs 30-plus scientists and engineers, many already busy developing second-generation battery that promises to be more powerful and last longer.

Work also has begun here on pilot production. For now, batteries are being assembled by hand, but automation is expected to reach 50% by March and 90% by September.

It took about six months to develop the basic concept for the battery, which Dhar expects to enter testing with the Department of Energy’s Argonne National Laboratory by mid-2013. That should be completed by the end of the year and provide the auto industry with independent data on the battery’s performance.

If all goes well, production will follow in fourth-quarter 2014 and be ramped up in early 2015 for aftermarket, conversion-vehicle, stationary and commercial-vehicle applications. The goal is to land light-vehicle business in time for the ’16 model year.

“At the end of (next) year, a serious (OE) guy will be sitting (here) with data in their hands from a national lab” discussing a product program, Dhar predicts.

Energy Power’s founder would like to set up a factory on the grounds of Ford’s former Lincoln assembly plant in Wixom, MI.

That huge complex, in the midst of a tear-down, initially was earmarked by the state of Michigan as the site of a new renewable-energy park. But that plan is being recast after two companies that were to serve as anchor investments, battery maker Xtreme Power and solar firm Clairvoyant Energy, failed to secure Department of Energy financing. Current talk is for the land to be used partially for retail development.

Dhar believes there still may be room there for an investment by EPS, however. The company earlier secured a $15 million state battery credit that would cover about 25% of the cost to set up manufacturing.

“We’re still hoping we can set up (in Wixom),” he says. “We only need 400,000 sq.-ft. (37,160 sq.-m) of building. Worst case is our plant is located in some other renaissance zone within the Detroit metropolitan area.”

Meantime, auto makers will continue to focus on NiMH and Li-ion as they move toward electrification, Dhar admits.

“They have no option – until they find out what we are doing,” he says.