Mesa Minerals Limited
Are our EMD patents of continuing value?
This is my site Written by Alan on October 22, 2008 – 3:34 pm

This is a question that is frequently asked, but one that is difficult to answer succinctly, in that our patents’ value relies on the interplay of so many factors. Accordingly, any article that will help to illustrate really well a particular source or cause of value inherent in our patents is worth featuring and commenting upon in this blog. I think that the following article meets this criterion for inclusion.

In reading a very recent article in the MIT Technology Review entitled Renault Bets on Electric Vehicles I noted an example of an important principle that I believe will help to ensure that our patents, so far as they relate to EMD production as a feedstock for battery production, will have ongoing relevance and value.

The principle is that the capital investment in existing battery technologies will slow or even stop dead the advance of new battery technologies until such time as there is an overwhelming need combined with a preparedness to pay more for the better power or other superior characteristics potentially offered by newer batteries technologies.

If you just read all but the last paragraph of the MIT article on Renault’s ZE concept car, you would be excused for concluding that this carmaker is intending to move this vehicle into production powered by a new type of Li-ion battery that has a cathode comprised of phosphate modified with trace metals. A decision that would not be good news, if viewed from the selfish perspective of a company like HiTec, which holds patents over the means of producing high purity EMD suitable for use in Li-ion batteries with manganese cathodes!

However, if one goes on to read the last paragraph of the article it notes, almost as an aside, that Renault actually intend to launch the vehicle incorporating a Li-ion battery that has a manganese cathode. You might well ask why they would propose doing this after lauding the benefits of the phosphate version. Well, there are many reasons that are not so hard to grasp when you think it through and these include:

  • The manganese variant is already in production at a truly viable scale;
  • It is a good technology that will do the job at hand admirably at an affordable cost;
  • The phosphate technology has to be brought up the development curve; and
  • Once proven technically ready for production, it then has to be financed in a context where it must compete with existing battery systems for market share.

The lesson in all this is that eventually, a better technology will replace a good technology where the need exists, as people will pay more for it. Looking backwards, no better example of this is the replacement of the zinc/carbon battery with the alkaline battery. Newer electronic devices being introduced over the last thirty years required a better battery technology for power, miniaturization, or other reasons and people became accustomed to paying more for these advantages. However this replacement exercise has taken decades rather than years and will likely take a decade or two more to be completed.

So whilst it is only one cause or driver of continuing value for our patents, it is an important one, as disposable battery systems (ie, alkaline, Li-ion/Mn) and rechargeable battery systems (ie, Li-ion/Mn from very small scale to very large) all utilizing high purity EMD, are already strongly in production or moving into production in advance of competitor systems, and the investment made in them is relentlessly raising the investment hurdle for following technologies. Not necessarily shutting the door on newer technologies, but slowing their rate of introduction to those devices and those users that simply ‘must’ have them for whatever reason.

As a side note, the Renault ZE concept car article is also of interest in that it signals that another large car maker is prepared to see the dependency link between the car and the bowser severed. The electric vehicle format was always a better solution for the vast majority of today’s drivers than the hybrid electric/combustion vehicle format and that fact is being increasingly recognised. (You can ignore the old KISS principle for a while, but if you continue to do so for too long, it will inevitably come back and smack you hard behind the ear!)

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