Down in his basement laboratory at the Massachusetts Institute of Tech­nology, Donald Sadoway and his students are hunting for the perfect battery. Not for cellphones or laptop computers, but to power a future generation of automobiles or perhaps the electric grid.

To achieve that goal, we will need batteries many times cheaper, safer, more powerful, and more durable than today’s best, professor Sadoway says. They must store enough juice to send a car 250 miles on a charge – and cheap enough to store solar or wind power for use at night and in calm periods, he says.

Risky, over-the-horizon research is vital because, although most Americans and politicians don’t know it yet, the United States is in a global race to build a new generation of batteries based on lithium-ion technology, Sadoway and others say.

With double the “energy density” of today’s standard nickel-metal-hydride batteries, lithium-ion cells have emerged as a viable first-generation battery chemistry to power plug-in hybrid vehicles (PHEVs), major announcements this month reveal.

Such a battery is critical to President Obama’s energy plan, which includes deploying PHEVs that go 40 miles on a charge in order to replace much of the nation’s oil imports with US-generated electricity. As electricity replaces gasoline, the race to develop ever more powerful batteries will determine which nations emerge as winners in transportation, renewable energy, and economic clout, many say.

“We’re entering an exciting new phase for the automotive industry where we increase the electrification of vehicles, reducing consumption of gasoline through advanced batteries,” David Vieau, president A123Systems in Watertown, Mass., said in a statement this month announcing its plan to build the nation’s first lithium-ion battery manufacturing plant.

Yet the US is entering the race late. It must move fast to catch Japan, Korea, and China. Each is pouring billions into lithium research and each already has manufacturing plants.

Still, there are signs the tide may be turning. A123Systems has applied for $1.8 billion in funding from the US Department of Energy to build a lithium battery factory in Detroit big enough to supply a half dozen auto companies and employ 14,000 workers.

Last week, the National Alliance for Advanced Transportation Battery Cell Manufacture, a consortium of more than a dozen US battery developers, announced it was seeking up to $2 billion to fund a major lithium battery manufacturing facility.

“We cannot allow ourselves to become dependent on foreign sources of lithium-ion battery cells as we have become dependent on petroleum from the Middle East,” says James Greenberger, the National Alliance’s director.Now add the Obama administration’s plan to spend $25 billion for new energy programs. All of which is good news to battery researchers like Sadoway, who have long toiled with slender funding as research dollars sluiced to fuel cells, nuclear power, and others with more buzz and backers.

“I applaud the new money going into battery research,” Sadoway says. “We’ve been underspending on something that’s vital to our national security and economic well-being.”

In the near term, however, the US is playing catch-up. For more than a year, General Motors has said it hopes to launch the world’s first mass-produced PHEV, the Chevrolet Volt, in 2010. But until recently, GM executives had been damping expectations, saying a battery with the right performance and cost still didn’t exist.

That changed last week when GM named LG Chem, a Korean company, as the lithium-ion battery cell supplier for the Volt. It is also working with A123Systems, officials say. Not to be outdone, Toyota announced it would sell some PHEVs with lithium batteries late this year.

“When we introduced this [Chevrolet Volt] concept not long ago, it seemed to resonate,” says Robert A. Kruse, GM’s executive director of global vehicle engineering for hybrids, electric vehicles, and batteries. “We said, ‘Hey, we’ve got to figure out how to do this. The battery didn’t exist. We went through a very elaborate search of cell chemistry and construction.” (For the full interview with Mr. Kruse, click here.)
Finding the right battery recipe
The beauty of lithium-ion is there’s not one single chemical, but many variants involved. As a result, the race isn’t over making a Chevy Volt battery designed to run 40 miles on a single charge that could cost as much as $10,000. Instead engineers hope to create a cell that could last perhaps 80 miles per charge and cost half as much, battery experts say.

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