When they first hit the market, whether in laptops or packs that powered cordless tools, lithium-ion batteries offered a leap in performance when compared with other types of batteries like lead-acid or nickel-cadmium.

Lithium-ion cells weren't immediately adopted in all tools or machines, however, because of their novelty and higher costs. But as with any new technology, prices continued to drop as more and more manufacturers spun up lines and pushed out more products.

Lithium-ion cells have since become the standard in most tools and larger applications where their smaller size, lower weight and higher capacity greatly improve utility. Not all lithium-ion cells are the same, though; there exist different variations of anodes, cathodes, storage configurations, and chemistries. All of these variables affect a battery's strengths, with different designs being more optimal for different applications.

It's not quite Betamax vs. VHS, but there are format debates within the lithium-ion ecosphere. For utilities, transportation executives and even homeowners, it's valuable to understand the differences between some of the primary lithium-ion products currently on the market.

One of the most important aspects affecting how large lithium-ion batteries perform is the cell structure chosen by the battery's manufacturer. One of the earlier cell designs, 18650, looks much like D-batteries. Thousands of these cells are then linked in series and then in parallel, allowing for a simple construction. Manufacturing 18650 cells is among the cheapest methods for producing large lithium-ion batteries, running as little as 40 cents per watt-hour.

Another configuration of cells, known as prismatic, has been gaining ground during the last five years. Batteries employing prismatic cell layouts can pack more energy storage within their volumes, making the same devices more powerful without enlarging their footprints or forms. Prismatic configurations pack cells together in cube-like formations, utilizing most of the space within a battery, making them very energy dense.

The prismatic construction also produces better thermal characteristics, requiring less cooling per energy unit compared with 18650s. But their density and intricacy mean that prismatic-based batteries cost nearly 50 percent more to manufacture than 18650s, at about 60 cents per watt-hour at the low end.

Prismatics hold other advantages as well. Many large 18650 batteries can be cycled 2,500 times or so before they lose much of their storage efficacy. Prismatics can retain a high percentage of their storage capacity, however, after being cycled 7,500 to 10,000 times, making them better suited for applications where their power will be regularly drawn all the way down and charged back up.

For energy storage in an electric car, where weight and space aren't as important as in a new-age composite airplane, batteries based on 18650 configurations can make sense. Electric cars also don't require high levels of cycling, as their batteries aren't usually drawn down to near empty and recharged on a daily or twice-daily basis. This makes the relatively low number of available cycles within an 18650 battery quite acceptable for use in electric vehicles. So it makes sense that Tesla selected 18650s for use in the Model S, where 7,000 cells line up together to form the car's power source.

A car also has a limited amount of continuous power demand. New appliances or gadgets won't be heaped upon the car's systems, thus increasing the load required from the battery. The car's engine will remain the same size. This is important for 18650 batteries because they tend to operate with lower C-Ratings, which is measurement of how quickly a battery can discharge its stored energy.

A 12-kilowatt-hour battery whose continuous output peaks at 4 kilowatts has a C-Rating of .333 (12 kWh / 4 kW). That kind of number is typical of 18650 batteries. 

Prismatic batteries, however, can carry C-Ratings of between 1 and 2 (or higher). That makes them more valuable in settings where draws can greatly vary, like in a home, where the load can go from just a few lamps in the morning to an evening load made up of those same lamps, plus an air conditioner, an oven, and a sump pump. If you want to use 18650 batteries in that home environment, you have to make a stark choice: reduce the possible demand to a bare minimum, or shorten the battery life dramatically.

Tesla ultimately seeks more traction in the consumer market, where price can be a key differentiator -- another reason it likely selected 18650, which can cost 30 percent less than similar batteries of prismatic construction. Tesla's decision to roll out its home storage Powerwall product with an 18650 lithium-ion battery likely traces to similar motivations: lower price for the consumer. And Tesla, along with its partner Panasonic, already possessed a supply line for constructing the 18650 batteries.

It's a decision that is being closely watched by the industry. The thinking in many corners has been that home storage solutions are often best when constructed with prismatic batteries, especially in the cases where utilities are using the batteries as living pieces of the grid that help manage peak loads.

But we also grant that 18650-based batteries do offer lower costs to consumers and an affordable route to getting their first battery system installed. This approach would work where a consumer only wants a simple backup power solution or PV self-consumption optimization. Sunverge's batteries, manufactured in Korea by Kokam, are prismatic, but our software and control systems also work well with 18650 configurations from other manufacturers like Tesla.

For applications that require batteries to be cycled often or that are expected to have very long useful lives, prismatics make more sense, as their lifespans can be three to four times that of 18650 batteries. This fact makes prismatics cheaper to own and operate across their lifetimes in those settings.

For a utility that is examining how to make its grid more dependable and efficient by integrating with battery systems in consumers' homes, prismatic technology is preferable. Utilities will use these batteries' capacities daily, drawing on them during peak load times, and allowing the batteries to sock away energy when electricity is cheaper and more abundant.

But even with that stipulation, 18650s may play a key role in spreading battery technology to normal households across the world. Lower entry-level products, as Harvard professor and best-selling author Clayton Christensen has well documented, pave the way for more nuanced and advanced products in the space down the road.


Stu Statman leads engineering at the intelligent energy storage company Sunverge Energy.