Tesla announced it has developed a new energy storage battery during Tuesday’s Battery Day event that it claims can more than halve production costs, store more energy and lead to a more affordable electric car.

Overall, the new battery would increase vehicle range by up to 54%, the company said.

Tesla CEO Elon Musk said the innovation would allow Tesla to create a passenger car within the next three years that would cost $25,000.

“This has always been our dream from the beginning of the company,” Musk said.

Musk touted the energy cell as ‘truly revolutionary,’ adding it will push Tesla’s goal of making sustainable energy more efficient and widespread.

“The fundamental good of Tesla will be .. by how many years did we accelerate sustainable energy,” Musk told shareholders at the annual meeting. “That’s how I think about Tesla and how we should access our progress.”

During its Battery Day event, Tesla claimed the new cell will store 50% more energy. Despite being larger, Tesla claims the new battery will not suffer from long recharge times, since the cells feature a shingled “tabless” design inside.

The electric vehicle company said the new battery cell will halve the cost of production per KWh. The new battery will be engineered using raw silicon, which Musk said helps reduce costs dramatically and boost the range of their vehicles. A new cathode production process would also remove the need for wastewater.

Musk said new factories would refine the raw materials needed on-site.

The new battery would be built into the structure of future Tesla vehicles. Musk claimed the new design will allow Tesla to pack more batteries into their cars and trucks.

Production has already begun on the new batteries at a pilot plant, which will reach its energy production goal in about a year, Musk said. Tesla claimed new more-efficient factory lines are also in development which would be able to scale up to seven times the output.

“Tesla is aiming to be the best at manufacturing of any company on Earth,” Musk said.

Musk said Tesla aims to develop 100 GWh of internal cell production — in addition to energy purchases from other companies — by 2022. Tesla aims to hit 3 Terawatt/hour levels of production by 2030.

“It bodes really well for the future,” Musk said.

Rumors about Tesla making a low-cost, long-life battery have been swirling since earlier this year. 

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