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New technology starts expensive. The cost curve tells you how fast it gets cheap.

Lithium-ion battery cells cost 99% less than they did in 1991. What the cost curve is, why it happens, and how owners and investors should use it.

By Dan Lee · November 2026

In 1991 a lithium-ion battery cell cost about $9,200 per kilowatt-hour of capacity, in today's dollars. In 2024 it cost $78. That is a 99% decline in 33 years, about 13.5% a year. New technology almost always starts at a premium. What happens next is more predictable than most business plans assume.

In brief

  • New technologies get cheaper on a curve: each doubling of cumulative production cuts cost by a roughly steady percentage. The idea dates to aircraft plants in the 1930s.
  • Lithium-ion cells and solar modules have followed the same curve for decades, each falling about 13% a year. Battery cells have fallen about 20% for every doubling of cumulative production, solar modules about 24% for every doubling of installed capacity.
  • The curve is not smooth. Raw-material spikes interrupt it, as lithium did in 2022 and polysilicon did in the mid-2000s.
  • For owners and investors, the curve is a forecasting tool, a pricing discipline and a warning: the savings are shared across an industry, so they are rarely a moat on their own.

The pattern has a name

In 1936 Theodore Wright, an engineer at Curtiss-Wright, showed that the labor needed to build an airplane fell by a steady share, about 20%, every time the total number built doubled. In the 1960s Bruce Henderson of the Boston Consulting Group extended the idea to all of a product's costs and called it the experience curve. Today it is often called Wright's law.

The mechanism is not mysterious. Each doubling brings more learning on the line, larger plants, better equipment, a deeper supplier base, design changes that remove cost, and occasional breakthroughs in materials or process. None of these happens by itself. Together, across an industry, they move cost down at a rate that has been surprisingly steady for many technologies.

The rate matters more than any single price. A 20% learning rate means cost falls by a fifth with every doubling of cumulative volume. Early on, when volume doubles every year or two, cost falls fast. Later, each doubling takes longer, and the decline slows even though the curve is unchanged.

Lithium-ion: 33 years on the curve

Price of lithium-ion battery cells, 1991 to 2024 Real price per kilowatt-hour fell from about 9,200 dollars in 1991 to 78 dollars in 2024, a 99 percent decline, with a brief rise in 2022. $0/kWh $2,500/kWh $5,000/kWh $7,500/kWh $10,000/kWh 1990 1995 2000 2005 2010 2015 2020 2025 1991: $9,210 per kWh 1992: $7,388 per kWh 1993: $5,882 per kWh 1994: $6,714 per kWh 1995: $6,302 per kWh 1996: $5,308 per kWh 1997: $4,545 per kWh 1998: $3,657 per kWh 1999: $2,770 per kWh 2000: $2,691 per kWh 2001: $1,878 per kWh 2002: $1,346 per kWh 2003: $1,040 per kWh 2004: $931 per kWh 2005: $803 per kWh 2006: $687 per kWh 2007: $656 per kWh 2008: $688 per kWh 2009: $613 per kWh 2010: $551 per kWh 2011: $525 per kWh 2012: $540 per kWh 2013: $491 per kWh 2014: $434 per kWh 2015: $332 per kWh 2016: $259 per kWh 2017: $187 per kWh 2018: $157 per kWh 2019: $132 per kWh 2020: $123 per kWh 2021: $119 per kWh 2022: $132 per kWh 2023: $111 per kWh 2024: $78 per kWh 1991: $9,210/kWh 2000: $2,691/kWh 2010: $551/kWh 2024: $78/kWh 2022: price rose as lithium spiked 99% cheaper in 33 years About 13.5% a year, every year on average Real U.S. dollars (2024) per kilowatt-hour of cell capacity
Price of lithium-ion battery cells, real 2024 U.S. dollars per kilowatt-hour. Source: Rupert Way (2026), based on Ziegler and Trancik (2021), BloombergNEF and Avicenne Energy, via Our World in Data.

Sony began selling lithium-ion cells in 1991, for camcorders and other consumer electronics. Laptops and phones carried the volume through the 2000s. Electric vehicles and grid storage took over in the 2010s, and that is when volume, and the cost decline, accelerated again.

Researchers at MIT who rebuilt the price history from more than 1,700 records found that real cell prices fell about 13% a year from 1992 to 2016, and about 20% for each doubling of the cumulative market. Plotting price against the total amount of lithium-ion ever produced shows the curve directly:

Lithium-ion cell price against cumulative production, 1991 to 2023 On log scales, cell price falls along a nearly straight line as cumulative production grows from about 130 kilowatt-hours in 1991 to 3,500 gigawatt-hours in 2023: about 29 percent cheaper for every doubling. $10,000/kWh $1,000/kWh $100/kWh $10/kWh 100 kWh 1 MWh 10 MWh 100 MWh 1 GWh 10 GWh 100 GWh 1 TWh 10 TWh Cumulative lithium-ion batteries produced worldwide (log scale) Cell price, real 2024 U.S. dollars per kWh (log scale) 1991: $9,210/kWh at 0.00013 GWh cumulative 1992: $7,388/kWh at 0.00168 GWh cumulative 1993: $5,882/kWh at 0.0146 GWh cumulative 1994: $6,714/kWh at 0.0535 GWh cumulative 1995: $6,302/kWh at 0.177 GWh cumulative 1996: $5,308/kWh at 0.674 GWh cumulative 1997: $4,545/kWh at 1.39 GWh cumulative 1998: $3,657/kWh at 2.4 GWh cumulative 1999: $2,770/kWh at 3.89 GWh cumulative 2000: $2,691/kWh at 6.11 GWh cumulative 2001: $1,878/kWh at 8.76 GWh cumulative 2002: $1,346/kWh at 12.5 GWh cumulative 2003: $1,040/kWh at 17.9 GWh cumulative 2004: $931/kWh at 25.3 GWh cumulative 2005: $803/kWh at 34.2 GWh cumulative 2006: $687/kWh at 46 GWh cumulative 2007: $656/kWh at 60.1 GWh cumulative 2008: $688/kWh at 77.3 GWh cumulative 2009: $613/kWh at 95.6 GWh cumulative 2010: $551/kWh at 119 GWh cumulative 2011: $525/kWh at 148 GWh cumulative 2012: $540/kWh at 182 GWh cumulative 2013: $491/kWh at 225 GWh cumulative 2014: $434/kWh at 278 GWh cumulative 2015: $332/kWh at 362 GWh cumulative 2016: $259/kWh at 468 GWh cumulative 2017: $187/kWh at 600 GWh cumulative 2018: $157/kWh at 790 GWh cumulative 2019: $132/kWh at 1e+03 GWh cumulative 2020: $123/kWh at 1.28e+03 GWh cumulative 2021: $119/kWh at 1.74e+03 GWh cumulative 2022: $132/kWh at 2.46e+03 GWh cumulative 2023: $111/kWh at 3.51e+03 GWh cumulative 1991: $9,210/kWh 2000: $2,691/kWh 2010: $551/kWh 2023: $111/kWh Since 2000: about 29% cheaper for every doubling Dashed line: best fit over 9 doublings, 2000 to 2023. Across all 25 doublings since 1991: about 20% per doubling. 1990s: tiny volumes, slow learning
Lithium-ion cell price against cumulative global production, both on log scales, 1991 to 2023. Dashed line: best fit from 2000. Source: Rupert Way (2026), based on Ziegler and Trancik (2021), BloombergNEF and Avicenne Energy, via Our World in Data; Stradaro calculation.

Cumulative production went from about 130 kilowatt-hours in 1991, roughly two of today's electric-car battery packs, to about 3,500 gigawatt-hours by 2023. That is roughly 25 doublings. Across all of them, price fell about 20% per doubling. The shape matters too. In the 1990s, when total volume was tiny, prices moved slowly. Once production reached gigawatt-hours, the curve steepened to about 29% per doubling. Learning needs volume to work on.

The decline has continued since. BloombergNEF's 2025 survey put the average battery pack, the finished assembly that goes into a vehicle or a storage system, at $108 per kilowatt-hour. That is down 93% since 2010. Packs for stationary storage averaged $70.

The curve has also had a bump. In 2022, average pack prices rose 7%, the first increase since BloombergNEF began its survey in 2010, as lithium and other materials spiked. Prices resumed their fall the next year. Over a long horizon the trend won. In a single year, the commodity did.

Solar ran the same curve, for longer

Solar modules are the clearest long-run example. Batteries are priced per kilowatt-hour of storage and solar modules per watt of generating capacity, so they cannot share an axis. Plotted on the same timeline and the same log scale, where a straight line means a constant rate of decline, their slopes look almost the same:

Lithium-ion cells in dollars per kWh and solar modules in dollars per watt, log scale Two panels on the same timeline and the same log scale. Battery cells fell from about 9,200 to 78 dollars per kWh from 1991 to 2024; solar modules from 132 to 0.12 dollars per watt from 1975 to 2025. Both fell about 13 percent a year. Lithium-ion battery cells, real 2024 U.S. dollars per kWh (log scale) $10/kWh $100/kWh $1,000/kWh $10,000/kWh $100,000/kWh 1991: $9,210/kWh 1992: $7,388/kWh 1993: $5,882/kWh 1994: $6,714/kWh 1995: $6,302/kWh 1996: $5,308/kWh 1997: $4,545/kWh 1998: $3,657/kWh 1999: $2,770/kWh 2000: $2,691/kWh 2001: $1,878/kWh 2002: $1,346/kWh 2003: $1,040/kWh 2004: $931/kWh 2005: $803/kWh 2006: $687/kWh 2007: $656/kWh 2008: $688/kWh 2009: $613/kWh 2010: $551/kWh 2011: $525/kWh 2012: $540/kWh 2013: $491/kWh 2014: $434/kWh 2015: $332/kWh 2016: $259/kWh 2017: $187/kWh 2018: $157/kWh 2019: $132/kWh 2020: $123/kWh 2021: $119/kWh 2022: $132/kWh 2023: $111/kWh 2024: $78/kWh 1991: $9,210/kWh 2024: $78/kWh Li-ion cells 118x cheaper 13.5% a year Solar PV modules, real 2025 U.S. dollars per watt (log scale) $0.10/W $1/W $10/W $100/W $1,000/W 1975: $132/W 1976: $100/W 1977: $73/W 1978: $51/W 1979: $43/W 1980: $37/W 1981: $29/W 1982: $26/W 1983: $21/W 1984: $20/W 1985: $17/W 1986: $14/W 1987: $12/W 1988: $11/W 1989: $12/W 1990: $12/W 1991: $11/W 1992: $10/W 1993: $10/W 1994: $9/W 1995: $9/W 1996: $8/W 1997: $8/W 1998: $7/W 1999: $7/W 2000: $6/W 2001: $6/W 2002: $6/W 2003: $5/W 2004: $5/W 2005: $5/W 2006: $5/W 2007: $5/W 2008: $5/W 2009: $3/W 2010: $3/W 2011: $2/W 2012: $1/W 2013: $0.86/W 2014: $0.79/W 2015: $0.74/W 2016: $0.68/W 2017: $0.57/W 2018: $0.51/W 2019: $0.47/W 2020: $0.32/W 2021: $0.34/W 2022: $0.37/W 2023: $0.27/W 2024: $0.13/W 2025: $0.12/W 1975: $132/W 2025: $0.12/W Solar modules 1,101x cheaper 13.1% a year 1975 1985 1995 2005 2015 2025
Lithium-ion cells in real 2024 U.S. dollars per kWh (1991 to 2024) and solar modules in real 2025 U.S. dollars per watt (1975 to 2025), both on log scales spanning the same four orders of magnitude, so the slopes compare directly. Sources: Way (2026), based on Ziegler and Trancik (2021), BloombergNEF and Avicenne Energy; IRENA (2025) and others; via Our World in Data.

A solar module cost about $132 per watt in 1975 and $0.12 in 2025, in today's dollars. That is about 1,100 times cheaper. Plotted against cumulative capacity installed worldwide, the price follows Wright's law almost exactly:

Solar module price against cumulative installed capacity, 1975 to 2025 On log scales, price falls along a nearly straight line as cumulative capacity grows: about 24 percent cheaper for every doubling. $1,000 $100 $10 $1 $0.10 100 kW 1 MW 10 MW 100 MW 1 GW 10 GW 100 GW 1,000 GW 10,000 GW Cumulative solar capacity installed worldwide (log scale) Module price, real U.S. dollars (2025) per watt (log scale) 1975: $132.38 per watt at 1 MW cumulative 1976: $99.60 per watt at 1 MW cumulative 1977: $72.66 per watt at 2 MW cumulative 1978: $51.41 per watt at 4 MW cumulative 1979: $43.20 per watt at 5 MW cumulative 1980: $36.60 per watt at 8 MW cumulative 1981: $29.27 per watt at 13 MW cumulative 1982: $26.30 per watt at 19 MW cumulative 1983: $21.23 per watt at 29 MW cumulative 1984: $19.73 per watt at 47 MW cumulative 1985: $17.22 per watt at 66 MW cumulative 1986: $14.24 per watt at 89 MW cumulative 1987: $12.11 per watt at 114 MW cumulative 1988: $11.31 per watt at 141 MW cumulative 1989: $11.69 per watt at 173 MW cumulative 1990: $12.09 per watt at 212 MW cumulative 1991: $11.20 per watt at 257 MW cumulative 1992: $10.44 per watt at 309 MW cumulative 1993: $9.76 per watt at 366 MW cumulative 1994: $9.23 per watt at 424 MW cumulative 1995: $8.54 per watt at 489 MW cumulative 1996: $7.98 per watt at 565 MW cumulative 1997: $7.95 per watt at 651 MW cumulative 1998: $7.17 per watt at 771 MW cumulative 1999: $6.62 per watt at 914 MW cumulative 2000: $6.50 per watt at 1,103 MW cumulative 2001: $6.28 per watt at 1,373 MW cumulative 2002: $5.75 per watt at 1,738 MW cumulative 2003: $5.46 per watt at 2,229 MW cumulative 2004: $4.70 per watt at 2,916 MW cumulative 2005: $4.75 per watt at 4,391 MW cumulative 2006: $5.17 per watt at 5,912 MW cumulative 2007: $5.21 per watt at 8,266 MW cumulative 2008: $4.75 per watt at 14,445 MW cumulative 2009: $3.17 per watt at 22,483 MW cumulative 2010: $2.51 per watt at 39,849 MW cumulative 2011: $2.06 per watt at 70,428 MW cumulative 2012: $1.11 per watt at 99,541 MW cumulative 2013: $0.86 per watt at 134,728 MW cumulative 2014: $0.79 per watt at 172,967 MW cumulative 2015: $0.74 per watt at 220,151 MW cumulative 2016: $0.68 per watt at 291,686 MW cumulative 2017: $0.57 per watt at 384,915 MW cumulative 2018: $0.51 per watt at 479,046 MW cumulative 2019: $0.47 per watt at 580,467 MW cumulative 2020: $0.32 per watt at 710,726 MW cumulative 2021: $0.34 per watt at 854,812 MW cumulative 2022: $0.37 per watt at 1,045,691 MW cumulative 2023: $0.27 per watt at 1,410,556 MW cumulative 2024: $0.13 per watt at 1,866,898 MW cumulative 2025: $0.12 per watt at 2,378,042 MW cumulative 1975: $132.38/W 2000: $6.50/W 2025: $0.12/W About 24% cheaper for every doubling Dashed line: best fit across 22 doublings, 1975 to 2025
Solar module price against cumulative installed capacity, both on log scales, 1975 to 2025. Dashed line: best fit. Source: IRENA (2025) and others, via Our World in Data; Stradaro calculation.

Over 22 doublings of installed capacity, the module price fell about 24% with each one. The points above the line in the mid-2000s were a polysilicon shortage. Prices stalled, then fell faster than the trend once new silicon capacity arrived.

It is not only energy

Computer storage ran the curve even harder. The cost of storing a terabyte on disk drives fell about 29% a year from 1956 to 2023, and memory fell about 35% a year. Henry Ford's Model T went from $850 in 1908 to under $300 by the mid-1920s, which we covered in How to forecast a market that doesn't exist yet. Hamilton Helmer notes in 7 Powers that most experience curves studied fall in a band where each doubling takes cost to 70 to 85% of its prior level. In other words, cost falls 15 to 30% per doubling.

What the curve means for owners and investors

1. Forecast the price, not just the volume. If your plan depends on a technology that is still on its curve, the price in year five will not be today's price. A fleet electrification plan, a plant energy-storage project or a new product that uses batteries should be modeled with a falling cost line. The same is true in reverse for a business case that assumes today's premium will last.

2. Price ahead of the curve, and fund the cost roadmap to meet it. Henry Ford set prices for where cost would be, not where it was, and let volume drive cost down to meet them. In the 1960s Robert Noyce did the same at Fairchild, pricing early integrated circuits below what they cost to make on the bet that volume would bring cost below price. A supplier selling a component on a technology curve faces the same choice. Its customers will expect annual price reductions. The supplier that plans its cost roadmap around the curve keeps its margin. The one that waits for the request gives it away.

3. Do not mistake the curve for a moat. Helmer's point is that experience-curve savings are largely shared. Equipment makers, suppliers and engineers carry the learning across the industry. A competitor that reaches the same cumulative volume gets similar costs. When a target's investment thesis rests on a cost lead from experience, test whether rivals with similar volume have similar costs. If they do, the lead is temporary. Lasting advantage comes from something the curve does not give everyone: scale in a business with high fixed costs, switching costs, or a process others cannot copy.

4. Model the bumps. Raw materials set a floor under cost, and commodity spikes interrupt the curve for a year or two. Build a scenario where a key input doubles, and decide in advance whether you would pass it through, absorb it or wait it out.

5. Expect demand to expand as cost falls. Each step down the curve brings in buyers who could not justify the purchase before. Battery packs near $100 per kilowatt-hour opened up electric vehicles and grid storage at a scale that was not possible at $1,000. A forecast that holds the market size fixed while cost falls will understate both.

How to build a cost-curve forecast

  1. Find the learning rate. Use the technology's own price and volume history if there is one. If not, use analogs. Most fall between 15% and 30% per doubling.
  2. Forecast cumulative volume. The curve runs on cumulative production, not time. A volume forecast, built from adoption analogs, turns into a cost forecast.
  3. Check it against a bottom-up cost model. Materials, labor, energy and capital per unit set a floor. As cost falls, materials become a larger share and the curve flattens toward that floor.
  4. Add the bumps. Run a scenario with an input-price spike and one with faster adoption.
  5. Update every year. Compare actual prices to the curve. A widening gap says something has changed in the technology, the supply chain or the market.

What to do on Monday

List the technologies your business makes, buys or competes against that are less than 20 years old. For each one, find the price five years ago and today, and work out the annual rate of decline. Then ask what your plan assumes for the next five years. If it assumes the price stays flat, you are probably wrong, and you should know in which direction that hurts you.

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