Sodium is 1,000x more abundant than lithium in the Earth’s crust and 99% cheaper. So will sodium ion batteries (SIBs) disrupt LFP lithium ion batteries (LIBs)? Not until lithium carbonate prices treble to $40/kg. Or unless improved SIB electrode materials emerge. This 16-page SIB deep-dive de-risks our constructive lithium market outlook.
An AI energy transition is underway, as data centers, solar, EVs, more flexible grids, and robotics all grow into the global energy mix and dovetail with one another, causing global battery demand to double by 2030, rise 8x by 2050 (pages 2-3).
Lithium ion batteries using LFP cathodes as the leading battery chemistry. This likely causes 20-30% lithium market shortages (page 4). So can any other battery chemistry supplant LFP?
Sodium ion batteries are discussed from first principles on pages 5-6, explaining the key differences with lithium ion batteries, possible anode materials, cathode materials and their performance.
But cost is the single biggest determinant of which energy technology wins. Hence, we have modeled the relative costs of sodium ion batteries versus lithium ion batteries, with a breakdown across a dozen categories, on page 7.
Surprises from this modeling exercise are the importance of all-aluminium current collectors (page 8), almost no overall savings on the cathode side (page 9), the importance of energy density (page 10) and SIBs’ requirement for inflationary additives (page 11).
Hence, we argue lithium prices would need to rise above $40/kg, on a sustained basis, before it makes economic sense to start scaling up production of sodium ion batteries. Sensitivity analysis is shown on pages 12-14.
Leading companies developing sodium ion batteries — most notably CATL, BYD and HiNa — and the energy density of their frontrunner SIB chemistries, are presented on pages 15-16.
But overall, this analysis de-risks our constructive outlook for lithium in the ongoing AI energy transition. We have also screened lithium producers.