A new contender in advanced battery chemistry has caused a stir & dominated conversations over the past year – sodium-ion batteries (SiBs). Join us as we explore what could accelerate or hinder a SiB disruption in the battery industry!
Contact: Betsy Barry
Communication Manager
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betsy.barry@acculonenergy.com
For years, lithium-ion batteries have reigned supreme in the energy storage sector, powering everything from computers to material handling equipment. In fact, the worldwide lithium-ion battery market is projected to be valued at approximately $483.4 billion by 2032, experiencing a compound annual growth rate (CAGR) of 21.4% from 2025 to 2032.
However, a new contender in advanced battery chemistry has caused a stir and dominated conversations over the past year – sodium-ion batteries (SiBs) – and while they are poised to disrupt the market in the coming years, the timeline for SiBs to realistically compete with their lithium rivals depends on several factors. Today we are going to look at these factors to determine what could accelerate or hinder an SiB disruption in the battery industry.
Let’s start out today’s overview by acknowledging that SiBs offer some key advantages over their lithium-based counterparts:
- Cost-Effectiveness: Sodium is far more abundant and readily available than lithium, making sodium-ion batteries less expensive to produce. In fact, sodium is reportedly 500 times more abundant than lithium, which alleviates concerns about resource scarcity and price fluctuations. This potential cost advantage is crucial as the demand for energy storage skyrockets, particularly for large-scale applications like grid storage, which will need to be modernized to meet these skyrocketing demands.
- Simplified Supply Chains: Sodium-ion batteries rely on readily available materials and have simpler supply chains compared to lithium-ion batteries, which often depend on complex and geographically concentrated sources for critical components. This makes sodium-ion technology more resilient to supply chain disruptions and potentially less prone to geopolitical tensions associated with sourcing lithium.
- Enhanced Sustainability: Sodium-ion batteries utilize less environmentally impactful materials compared to lithium-ion, making them a more sustainable choice. This resonates with the increasing emphasis on environmentally friendly and ethical sourcing practices in the battery industry–practices that now have a regulatory component with the EU implementing the Battery Passport.
- Safety: Sodium-ion batteries generally exhibit lower fire risks compared to lithium-ion, a critical consideration for large-scale energy storage applications where safety is paramount. SiBs can be taken down to a 0 charge, increasing safety-related issues associated with shipping and storing.
Cost-effectiveness, simplified supply chains, enhanced sustainability, & increased safety have all caused Sodium-Ion batteries (SiB) to emerge as a new disrupter in the global battery market.
As this new technology matures, it opens up new opportunities for a variety of applications.
Global Sodium-Ion Battery Market Growth
Currently, the global SiB market share is projected to grow to a CAGR of 23% from 2025 to 2031, and countries like Germany are investing heavily in the development of SiB technology, with a focus on energy density, stability, and extended life cycles. Additionally, domestic production has begun in the first-ever commercial-scale SiB operation on US soil, offering yet another competitive advantage as domestic manufacturing efforts get underway.
There are other global indicators of the growing momentum behind sodium-ion batteries. Established battery manufacturers, including Chinese giants CATL and BYD, are actively investing in sodium-ion technology development, signaling a shift in the industry landscape. Their entry into the market brings significant resources and manufacturing expertise, potentially accelerating the adoption of sodium-ion batteries across the industry. There has also been a rise in VC-backed sodium-ion companies like Natron Energy, which is building a gigafactory on US soil. This influx of investment shows growing confidence in the commercial viability of the technology, as energy storage solutions become a fixture in conversations about rising energy consumption and the role of battery systems in meeting projected power needs. This is demonstrated in conversations surrounding the need for long-duration energy storage increases (LDES), as sodium-ion batteries, with their potential for lower cost and simplified manufacturing, could become a more attractive alternative to lithium-ion for stationary applications.
So, while lithium-ion batteries currently dominate the market, their position does exhibit vulnerability. Developers outside of China are seeking to diversify. Geopolitical concerns, as well as concerns over lithium supply chain constraints, environmental impacts, and safety issues, are also creating space for alternative chemistries like sodium-ion to gain traction and a commercially viable alternative.
That said, the disruption of the lithium-ion market by sodium-ion will likely be a gradual process. And lithium-based technologies continue to improve, as well as evolving safety profiles and regulations, meaning that lithium-ion-established infrastructure and economies of scale continue to offer their advantages.
Current Challenges for Sodium-Ion Batteries
At present, however, challenges in SiBs persist. One obvious challenge is that SiBs have a lower energy density than lithium batteries, although the flush of SiB research and development is actively addressing this issue. One area of research needed is to increase energy densities without relying on critical minerals, which segues into the next challenge: creating robust supply chains, production capabilities, and refining capacity. For example, China controls more than 90% of the global graphite supply–a critical material in lithium-ion batteries. Over the past few months, China has significantly restricted exports of graphite to the US, while also banning the export of other critical minerals as well. This creates an impetus for further investments in SiBs, but even so, lithium prices are near historic lows, creating a narrower set of technology routes for becoming advantageous in terms of price over the next decade. Suffice it to say, it is a complicated dance and a confluence of factors that will need to coordinate with global and domestic demand that will see SiBs starting to catch up to lithium. In the future, we will see all of these factors as well as pressures from different market sectors that are seriously eyeing SiBs as a superior contender.
But what remains to be seen is what will happen once sodium-ion technology matures and production costs decline, creating an increasingly competitive landscape, particularly in some specific commercial and industrial applications, like stationary energy storage. Sodium-ion batteries are well-suited for grid-scale energy storage, where their cost and longer cycle life offer attractive advantages. This is especially relevant as the adoption of renewable energy sources drives the need for large-scale energy storage solutions, in turn, driven by factors like AI and powering data centers, which are creating significant stressors on the grid, both domestically and abroad. And finally, the lower cost and simpler supply chains of sodium-ion batteries make them ideal for off-grid and microgrid applications, particularly in developing countries where access to electricity is limited. There is no shortage of external pressures that will no doubt shape the trajectory of SiBs.
All in all, the future of sodium is looking to be a bright one. Even so, lithium and sodium technologies will likely coexist, each catering to specific market niches based on their respective strengths and weaknesses.
One important takeaway is that the battery industry is poised for disruption, and that will come as a result of advanced battery technologies coming online, and the increasing need for energy storage solutions that go beyond the capabilities of what is currently available in the marketplace.