Battery Patents

Cobasys, the marketing arm of Energy Conversion Devices and Ovonic Battery group, does control hundreds of NiMH patents related to the invention of the NiMH battery by Stanford and Iris Ovshinsky, the founders of Ovonic and ECD.

Neither COBASYS nor ECD are "owned" or "controlled" by Chevron, although Chevron-Texaco once owned a portion of ECD stock and had formed an Ovonic joint battery venture, in part to diversify their energy investments, as many oil companies are doing today. Chevron has since sold off that stock at a handsome profit. The original battery patents have been licensed to dozens of leading international battery manufacturers. There is no way that they can be put "back in the bottle" and kept out of production, if a market for deep cycle EV or PHEV batteries were to develop again.

Currently, there IS NO EV or PHEV battery market to speak of, in terms of active demand for 100,000 or more battery packs annually -- which is what it takes to justify the millions of dollars required to start up an assembly line. Only the OEMs (Original Equipment Manufacturers) can make that happen -- not the battery companies!!

The Panasonic NiMH Batteries used in the RAV4EV were originally licensed from Ovonic and ECD. Panasonic's parent company, Matsushita, was permitted, under that agreement to modify the metal hydride mix, creating a somewhat different battery design, which they then claimed as their own, contrary to the original agreement, and refused to pay additional fees or royalties.

ECD then sued, as they should have, but it was a case of "David" (relatively tiny ECD) vs. Goliath (Matsushita, one of the world's largest battery megacorporations.) In order to sustain what was bound to be an expensive patent battle that would last for many years, ECD needed a "deep pockets" partner to carry them through.

Unfortunately, GM, their original partner, instead of building EVs and Hybrids, foolishly decided to spend their money opposing the CARB ZEV Mandate, and pulled up stakes in ECD/Ovonic just when Ovonic needed them the most!

Along came cash-rich ChevronTexaco, seeking a diversified investment, effectively rescuing ECD and Ovonic from almost certain financial disaster. If ECD had failed to protect their patents, the company would eventually die. If they spent too much money to protect their patents, they would also die. Eventually, ECD and Ovonic prevailed, winning a "compromise" agreement that protected most of their patents, shared others, and gave them the exclusive right to market Panasonic's NiMH batteries in the US. Whether or not that will happen, remains to be seen . . .

In effect, an oil company came along and rescued the bacon of a small innovative American battery company, and then "rode off into the sunset." k

Meanwhile, ECD, Ovonic and now Cobasys, continue to license their NiMH patents to other battery firms, including Chinese companies that may eventually sell their products here. In many instances they have separated traction battery patent rights from nontraction licenses. I can only speculate here, but I believe that this is related to prior exclusive licensee agreements that ECD has already negotiated with existing partners.

Overall, the advanced battery business seems to operate on something like "geological time," taking anywhere from 5 to 20 years -- or more -- to get a new design into production. It is the "evil twin" or the diametric opposite of the rapid production semiconductor business that is nonetheless joined at the hip with advanced batteries.

I have been privileged to see incredible progress in batteries in the 25 years or so that I have been involved in this business. It is difficult for both automobile manufacturers as well as the public to truly comprehend the Big Picture here and to figure out the best moment to hop aboard and ride the wave.

But that wave is gathering momentum. And the Bigger Picture, still, is this:

For the better part of the last century, the search for improved Energy Storage has been one of the fundamental challenges of our age. Unless or until we figure out the challenges of mastering Fusion Power -- the power of the Sun and the stars, producing more energy than we consume -- this search will continue to occupy the better part of this century as well!

Regards,

Dave Goldstein
President, EVA/DC and
Program Development Associates
EV and Advanced Battery Consultants
Gaithersburg, MD

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