Report: Falling Battery Prices to Boost EV Adoption in Next Two Years
A recent study from Goldman Sachs suggests a gradual decline in battery prices may lead to a boon in EV ownership within the next two years, according to Inside EVs.
The price of lithium-ion batteries has already been on a steady decline. By the end of 2024, researchers expect global average battery pack prices to fall to $111 per kilowatt-hour. Last year, that number was $149/kWh; in 2011, it was $780/kWh.
By 2026, battery pack prices are forecasted to fall another 26% to $82/kWh: roughly half of what prices would have been just three years prior in 2023. By the end of the decade, Goldman predicts prices to reach $64/kWh.
Factors contributing to this decline in battery prices has been attributed to advances in technology allowing for more energy to be contained at a lower cost, and a decline in prices for metals like lithium and cobalt.
Goldman Sachs has noted that the 2026 estimate would mark a milestone, as it would make the cost of owning an EV equivalent to that of an internal combustion engine, free of subsidies.
As such, Nikhil Bhandari, co-head of Goldman Sachs Research’s Asia-Pacific Natural Resources and Clean Energy Research, argued that this would likely lead to more consumers pursuing EV ownership come 2026.
“We think we’re going to see a strong comeback in demand in 2026 purely from an economics perspective,” stated Bhandari in the report. “We believe 2026 is when a consumer-led adoption phase will largely begin.”
