Sodium-based batteries are finding a niche

Lithium-ion batteries have some emerging competition: Sodium-based alternatives are starting to make inroads.  Sodium is more abundant on Earth than lithium, and batteries that use the material could be cheaper in the future. Building a new battery chemistry is difficult, mostly because lithium is so entrenched. But, this new technology has some advantages in nooks and crannies. 

For a few years, we’re starting to see the chemistry make progress, though not significantly in the big category of electric vehicles. Rather, these new batteries are finding niches where they make sense, especially in smaller electric scooters and large energy storage installations.

Two years ago, lithium prices were, to put it bluntly, bonkers. The price of lithium hydroxide (an ingredient used to make lithium-ion batteries) went from a little under $10,000 per metric ton in January 2021 to over $76,000 per metric ton in January 2023.  More expensive lithium drives up the cost of lithium-ion batteries. Price spikes, combined with concerns about potential shortages, pushed a lot of interest in alternatives, including sodium-ion.  

There’s one key point to understand here. Sodium-based batteries will need to be cheaper than lithium-based ones to have a shot at competing, especially for electric vehicles, because they tend to be worse on one key metric: energy density. A sodium-ion battery that’s the same size and weight as a lithium-ion one will store less energy, limiting vehicle range.

The issue is, as we’ve seen since that 2023 story, lithium prices—and the lithium-ion battery market—are moving targets. Prices for precursor materials have come back down since the early 2023 peak, with lithium hydroxide crossing below $9,000 per metric ton recently.  And as more and more battery factories are built, costs for manufactured products come down too, with the average price for a lithium-ion pack in 2024 dropping 20%—the biggest annual decrease since 2017.

One researcher the authors spoke with at the time suggested that sodium-ion batteries might not compete directly with lithium-ion batteries but could instead find specialized uses where the chemistry made sense. Two years later, we’re starting to see what those are.  One growing segment that could be a big win for sodium-ion: electric micromobility vehicles, like scooters and three-wheelers. Since these vehicles tend to travel shorter distances at lower speeds than cars, the lower energy density of sodium-ion batteries might not be as big a deal.  While smaller vehicles and stationary installations appear to be the early wins for sodium, some companies aren’t giving up on using the alternative for EVs as well. 

Ultimately, lithium is the juggernaut of the battery industry, and going head to head is going to be tough for any alternative chemistry. But sticking with niches that make sense could help sodium-ion make progress at a time when we need every successful battery type we can get.

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