Diversification in the Energy Storage Industry is Accelerating

Among current energy storage technologies, lithium-ion batteries (LIBs) dominate due to their high energy density and versatility. Initially driven by consumer electronics, their adoption has expanded to electric vehicles (EVs) and stationary storage. However, as demand grows, geopolitical risks, supply chain constraints, and raw material price volatility have exposed vulnerabilities in the LIB value chain. This has intensified the search for alternative energy storage chemistries, with sodium-ion batteries (SIBs or Na-ion batteries) emerging as a key solution. Within this report, the prospects and key challenges for the commercialization of SIBs are discussed.

 

As global electrification accelerates, reliance on critical minerals like lithium, cobalt, and nickel is raising concerns over long-term supply security. Diversifying battery chemistries is essential for scalability and sustainability, as no single technology is ideal for all applications. The sodium-ion chemistry will certainly not be the answer for all applications; however, it will be well-suited to complement, rather than displace, the existing and future lithium-ion and lead-acid (Pb-A) technologies in many applications. Additionally, localizing battery supply chains has become a strategic priority, as China currently dominates lithium refining and battery production. Sodium-ion technology presents an opportunity for regionalized manufacturing, reducing dependence on constrained lithium supply chains.

Scaling Up: From Pilot Plants to Mass Production

While Na-ion battery production is currently in its early stages, major players are rapidly scaling up. Today, production is limited to pilot-scale facilities and a few smaller factories, collectively producing just a few gigawatt-hours (GWh) per year. However, publicly announced expansion plans from raw material suppliers and battery manufacturers indicate that global Na-ion production capacity could exceed 100 GWh by 2030.

 

By 2030, additional investment could accelerate growth beyond current projections, as key stakeholders seek to industrialize the technology. Rapid shifts have already occurred in the battery industry—such as the widespread adoption of NMC811 and LFP chemistries within just a few years. Na-ion batteries require minimal modifications to existing lithium-ion manufacturing infrastructure, relying primarily on different materials and optimized production parameters rather than entirely new facilities.

 

However, not all projects are moving forward as planned. In February 2024, Kingshine cancelled its proposed 6 GWh sodium-ion battery facility in Jiangxi Province. Likewise, Veken Tech has postponed its 2 GWh project, originally set for completion in December 2024, now rescheduled to begin operations in December 2025. These setbacks underscore the ongoing challenges related to demand uncertainty, financing, and scaling up production.

 

This latest IDTechEx report provides a comprehensive analysis of global Na-ion commercialization efforts, covering over 30 key players worldwide. It includes insights into patent trends, cell specifications, targeted applications, and mass production timelines, with a detailed focus on China's leading role in scaling the industry.

 

Cost Competitiveness: Will Sodium-Ion Be Cheaper Than LFP?

Sodium-ion technology is often positioned as a lower-cost alternative to lithium-ion, but initial pricing may be higher than expected. According to IDTechEx research, the average Na-ion cell cost is currently ~US$87/kWh, considering variations in chemistry and manufacturing scale. Over time, production costs are expected to decrease toward ~US$40/kWh at the cell level (~US$50/kWh at the pack level), primarily using iron- and manganese-based cathode chemistries.

 

However, while short-term cost reductions will be driven by scaling production, manufacturing efficiencies, and supply chain localization, further reductions will become more challenging as the industry matures. If lithium prices continue where they are today near historic lows, sodium-ion has a narrower set of technology routes to become price advantageous in the next decade.

 

This report includes detailed cost modelling of various Na-ion chemistries, with a breakdown of material pricing and future projections.

Sodium-Ion's Role in EVs: A Complement, Not a Replacement

For most electric vehicles, volumetric energy density is a top priority, as maximizing battery capacity directly impacts driving range. In contrast, for grid storage, energy density is less critical, and cost per kWh per cycle is the dominant factor. This is where sodium-ion technology is particularly competitive, offering a compelling alternative to lithium-ion.

 

The greatest potential for Na-ion in transportation lies in applications where high energy density isn't essential. This includes starter-lighting-ignition (SLI) batteries, electric two- and three-wheelers, and microcars where lower-cost Na-ion batteries could offer higher charging speeds and better cold-weather performance compared to lithium-iron phosphate (LFP) cells.

 

In 2024, Na-ion batteries have advanced in both energy storage and EV applications, marked by several product launches and key operational milestones. However, setbacks in large-scale projects indicate that the technology remains in the market validation stage. To achieve broader commercial adoption, companies must prioritize cost reduction, performance improvements, and securing stable market demand.

Key Regional Catalysts for Sodium-Ion Battery Growth

Regional tailwinds for sodium-ion battery adoption stem from a combination of regulatory incentives, energy policies, and market-specific demand drivers. In Europe, the EU Green Deal and projects like Sodium-Ion-Battery Deutschland-Forschung are accelerating research, while industrial policies promote local battery manufacturing. China and India are driving Na-ion adoption through renewable energy expansion, prioritizing cost-effective energy storage for grid stabilization. In North America, rising demand for data center backup power (UPS) and long-duration energy storage (LDES) is creating new opportunities, supported by Inflation Reduction Act (IRA) incentives. Together, these regional catalysts are shaping a growth trajectory for sodium-ion technology.

 

This report provides in-depth market forecasts, competitive landscape analysis, and detailed insights into Na-ion technology development, making it a must-read for stakeholders in the energy storage, battery manufacturing, and raw material supply industries.

Key aspects

Key takeaways from this report include:

Analysis and discussion of Na-ion cathodes/anode chemistries and electrolyte formulations

Hard Carbon market analysis including suppliers and precursors

Na-ion player profiles including technology benchmarking

Na-ion industry supply chain and manufacturing capacities

Key Na-ion player patent analysis

Na-ion battery material and cost modelling

Target markets and applications for Na-ion batteries

Na-ion battery demand (GWh) and market value (US$) forecasts