"Lithium carbonate (one of the raw materials for lithium-ion batteries) only costs tens of thousands of yuan per ton; why bother with sodium batteries?" Dong Wei, who used to work at a sodium battery company in Hunan last year, has now switched to a company selling charging piles.

However, at the beginning of last year, Dong Wei firmly believed that the industrialization of sodium batteries would begin, and the forward-looking management of his company would lead them to stand on the new energy field's next era of opportunity.

On the surface, compared to lithium-ion batteries, sodium-ion batteries have many advantages, such as abundant resources, lower costs, and less susceptibility to fluctuations in the supply of upstream raw materials.

He remembers that during the company's weekly meetings at that time, the technical team would repeatedly emphasize the low-temperature performance and high safety of sodium batteries, looking forward to its broad prospects in the energy storage market and the low-speed electric vehicle market.

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At that time, the sodium battery industry also became the "hottest track," with various listed companies flocking to it, either officially announcing investment plans for sodium battery production capacity projects or emphasizing their own sodium battery technology reserves. Industry experts and securities institutions also shouted "the first year of sodium battery industrialization."

However, the market's enthusiasm faded faster than imagined. Dong Wei found that as the price of lithium carbonate fell from its peak to tens of thousands of yuan per ton, the once hopeful prospects for the sodium battery market quickly dimmed. Moreover, sodium batteries are far inferior to the lithium batteries they are trying to replace in the most critical performance indicator of batteries - energy density.

"Scale and technological maturity are both the gaps between sodium batteries and lithium batteries," Mo Ke, the founder and president of True Lithium Research, told reporters.

"The advantages of sodium batteries are all theoretical advantages. From theory to practical application, it still takes time," Zhou Shuangjun, a research and development expert at a leading battery manufacturer in South China, also told reporters.

Once "Hot"

The reason why sodium batteries once became a hot "track" in the battery field is inseparable from the once crazy soaring price of lithium carbonate. In November 2022, the price of battery-grade lithium carbonate once broke through the 600,000 yuan/ton mark, causing an uproar in the industry. The continuous "high fever" of lithium carbonate prices made downstream electric vehicle manufacturers suffer.In comparison, the price of sodium carbonate has long been maintained at around 5,000 yuan/ton. This means that, in theory, sodium batteries can rely on cheaper raw materials to achieve lower manufacturing costs. Precisely for this reason, when the price of lithium carbonate is high, sodium batteries are considered a technical path that can break through the cost bottleneck of lithium batteries.

"Sodium has an advantage in that its resources are relatively abundant. In the Earth's crust, the content of sodium is dozens of times that of lithium," Zhou Shuangjun told the reporter.

Moreover, compared to lithium batteries which are prone to "drop the chain" in cold environments, sodium batteries perform much more stably at low temperatures. Dong Wei explained to the reporter that sodium ions are easier to shuttle between the electrodes of the battery in low-temperature environments and are not as likely to "get stuck" like lithium batteries. For equipment that needs to work in the winter of the north, sodium batteries have more advantages.

Safety is another "selling point" of sodium batteries. Compared to lithium batteries, sodium batteries are less likely to experience thermal runaway in the event of overcharging or short-circuiting. Dong Wei explained, "When lithium batteries are overcharged or short-circuited, the internal lithium ions move rapidly, generating a large amount of heat, which can easily cause problems when the temperature is too high. Sodium ions are relatively mild, and the reaction is not so intense under similar conditions, and the accumulation of heat is also slower."

This difference stems from the chemical properties of sodium ions. Compared to lithium ions, sodium ions have lower reactivity and are less likely to cause intense exothermic reactions inside the battery. In addition, some cathode materials used in sodium batteries, such as Prussian blue-like compounds, have stronger structural stability and can maintain good structural integrity during charging and discharging, and are not prone to structural collapse due to voltage fluctuations. This makes sodium batteries more stable under extreme conditions, such as overcharging, short-circuiting, or high-temperature environments, reducing the risk of accidents.

Therefore, with various advantages, combined with the still high cost of lithium batteries between 2022 and 2023, securities institutions and some companies in the industry began to vigorously "tout" sodium batteries.

For example, in September 2022, Dongwu Securities published a research report stating: "The significant increase in lithium battery costs has put pressure on the industry chain, leading companies to seek breakthroughs with new material systems. Sodium batteries, with their natural cost advantage, have become the first choice. After mass production, the cost is expected to be reduced to 0.5 yuan/wh, which still has a cost advantage compared to lithium iron phosphate batteries under 100,000 yuan/ton of lithium carbonate. At the same time, the domestic supply corresponding to sodium carbonate is abundant, and the supply chain is safer."

The research report also stated: "2023 is the first year of sodium battery industrialization, achieving small batch shipments, and in 2024, large-scale mass production is expected, with a scale of up to 30GWh. We predict that the global demand for sodium batteries will exceed 100GWh in 2025."

In October 2022, CATL (300750.SZ) also stated on the investor interaction platform that the company is committed to promoting the industrialization of sodium-ion batteries in 2023.

Being "Forgotten"?Soon, sodium-ion batteries seemed to be "forgotten" by the market.

On October 10th, the well-known battery sector listed company Blue Lithium Core (002245.SZ) stated on the investor interaction platform: "With the significant drop in lithium carbonate prices, sodium-ion batteries currently do not have a cost advantage over lithium-ion batteries. According to relevant data, the actual shipment volume of sodium-ion batteries in China for 2023 was only 0.7GWh. After conducting technical research and development on sodium-ion batteries, the company is not currently mass-producing them."

The relevant data mentioned by Blue Lithium Core comes from the "China Sodium-Ion Battery Industry Development White Paper (2024)" released by the battery market research institution EVTank in June 2024. According to the statistical data from EVTank, the actual shipment volume of sodium-ion batteries in China for 2023 was only 0.7GWh, far below the previously predicted 3GWh.

"The main reason for the lower-than-expected shipment volume and industrial development of sodium-ion batteries is that their theoretical cost advantage has not yet been realized, and the average price of sodium-ion batteries is still higher than that of competing products such as ternary lithium-ion batteries, lithium iron phosphate batteries, and lead-acid batteries," EVTank analyzed in the white paper.

Success and failure both hinge on price. The sodium-ion battery track, which has been continuously watched due to high lithium carbonate prices, has also lost market attention following the collapse of lithium carbonate prices since 2023.

According to data released by Shanghai Steel Union, on October 11th, the price of battery-grade lithium carbonate fell by 1,500 yuan compared to the previous day, with an average price of 76,000 yuan/ton. In September, the futures price of battery-grade lithium carbonate had broken through the 70,000 yuan/ton threshold on several occasions.

"We have also done some calculations. If the price of lithium carbonate is below 100,000 yuan/ton, sodium-ion batteries will basically be very difficult to apply," said Mo Ke.

The reason is that sodium-ion batteries are far inferior to lithium-ion batteries, which they are trying to replace, in the most critical performance indicator of batteries - energy density. Low energy density means that under the same volume or weight, sodium-ion batteries store much less energy than lithium-ion batteries. For electric vehicles, energy density is directly related to driving range, and for energy storage systems, it is related to the energy storage capacity and efficiency per unit volume.

"Under current technical conditions, the energy density of sodium-ion batteries is about 100-150Wh/kg, while lithium iron phosphate batteries can reach 160-200Wh/kg, and ternary lithium batteries can even exceed 250Wh/kg," a battery industry analyst told the reporter.

It is this gap that puts sodium-ion batteries in an awkward position in market competition: even if they have a slight cost advantage, the larger volume required per unit of energy also increases the actual application costs of transportation, installation, and land occupation.Additionally, sodium batteries have not demonstrated sufficient breakthroughs in charging and discharging efficiency and cycle life, making it difficult for them to completely replace lithium batteries in practical applications, especially in the passenger car market where higher energy density and service life are required.

"Sodium batteries are more like a supplementary product, rather than a technology that can directly replace lithium batteries," a research and development personnel from a sodium battery company in Hunan confessed to the reporter.

Precisely for this reason, when the price of lithium carbonate fell from its 2022 peak, the so-called "cost-performance ratio" advantage of sodium batteries quickly diminished. Coupled with slower-than-expected technological progress, the enthusiasm of companies and capital for sodium batteries began to cool rapidly. Some companies that had previously announced sodium battery projects with fanfare have quietly shifted their focus back to lithium batteries and solid-state batteries, which have greater market prospects.

"If the price of lithium carbonate is between 100,000 and 200,000 yuan/ton, sodium batteries will have some applications in certain specific markets, such as low-temperature resistance and fast-charging scenarios. In addition, they may also find some opportunities in the two-wheeler market, such as electric bicycles. If the price of lithium carbonate exceeds 200,000 yuan/ton, then sodium batteries may be applied on a large scale, even replacing part of the lithium battery market," Mo Ke told the reporter.

Zhou Shuangjun also emphasized: "Previously, the price of lithium carbonate was as high as more than 500,000 yuan/ton, and now it is only tens of thousands of yuan/ton. The cost of lithium batteries has been greatly reduced. However, due to the small market scale, the cost of sodium batteries is difficult to reduce, which has become a bottleneck in their development. If the price of lithium carbonate was as high as in the previous two years, the industrialization process of sodium batteries would be much faster than it is now."

"This is a vicious cycle: lithium batteries are cheap, so there is no market for sodium batteries. Without a market, there is no scale, and the more it is not scaled, the less hope there is to reduce costs," Dong Wei said.

Waiting for the "window period"

During the interview process, many industry insiders expressed to the reporter that there is a misunderstanding in the market's positioning of sodium batteries.

"Sodium batteries and lithium batteries have a symbiotic relationship, not a replacement relationship. Sodium batteries are more likely to replace some lead-acid batteries in certain scenarios, such as new national standard electric bicycles, most of which still use lead-acid batteries. Compared with lead-acid batteries, sodium batteries have higher energy density, no worse safety, and better low-temperature performance," Zhou Shuangjun said when discussing how to view sodium batteries as a substitute for lithium batteries.

Industry insiders generally believe that sodium batteries cannot overturn the position of lithium batteries in a short period of time. On the contrary, sodium batteries are more like "complementers" in the market, making up for the shortcomings of lithium batteries in certain specific application scenarios, rather than completely replacing them."Although existing lithium batteries occupy a significant market share, they may gradually cede to other technologies in certain niche markets in the future, and sodium batteries will still be able to find their own market space," said Mo Ke.

"Firstly, there are new national standard electric bicycles, which we often refer to as 'little electric donkeys,' where sodium batteries can replace lead-acid batteries; secondly, there is the large-scale energy storage market, including commercial and industrial energy storage; and lastly, some A00-class electric vehicles or tricycles. These scenarios are all likely to be the first to use sodium batteries," according to Zhou Shuangjun, who sees these as the three major scenarios where sodium batteries will be deployed first.

The reporter also noticed that there have indeed been many implementation cases in these scenarios. For instance, on March 17, 2023, Yadea Holdings (01585.HK) and Hua Yu New Energy jointly launched the "Ji Natron 1" sodium-ion battery system and introduced the Yadea Ji Natron S9 electric two-wheeler equipped with this system; in September 2024, Yadea Holdings further launched the Feiyue FN5 Lite Changxing edition electric two-wheeler, equipped with a 48V24Ah sodium battery system, supporting battery swapping functionality, with a range of about 80 kilometers.

Furthermore, in May 2024, China's first large-capacity sodium-ion battery energy storage power station—Guangxi Nanning Fulin Sodium-ion Battery Energy Storage Power Station—was officially completed and put into operation, with a total capacity exceeding 100MWh; in the same month, China's first hundred-megawatt-hour level sodium battery energy storage project—Hubei Datang 100MW/200MWh Sodium-ion New Energy Storage Power Station Phase I—was also completed and put into operation, with a production scale of 50MW/100MWh; in June 2024, Guangzhou Development Group also started the construction of a 100MW/200MWh sodium-ion energy storage demonstration project in Honghu City, Hubei.

In terms of electric vehicles, on December 28, 2023, the sodium battery-equipped model—JMC Yi Zhi EV3 (Youth Edition), supported by Farasis Energy—officially rolled off the production line. This A00-class small electric vehicle has a range of 251 kilometers, with the sodium battery energy density between 140-160Wh/kg, and the discharge capacity retention rate at -20°C is over 91%.

Research data from the well-known new energy research institution, the Starting Point Research Institute (SPIR), shows that China's sodium battery shipments in the first half of 2024 were 1.5GWh, with an expected increase in the second half of the year, with the annual shipments expected to exceed 6GWh.

Although small-scale applications have already begun, in the view of industry insiders, whether sodium batteries can truly become the "wind direction" of the industry still depends on the cost of lithium batteries.

Mo Ke told the reporter that many companies in the industry chain are currently making intensive preparations to get ready for future changes in the lithium carbonate cycle.

"The sodium battery and sodium battery material companies I have contacted are very clear that the development of the sodium battery market is closely related to prices. They believe that this is a very good preparation stage and a good window period. Their strategy is to prepare this year and next year, so that once the price of lithium carbonate rises and the sodium battery market ushers in development opportunities, they can quickly seize this opportunity," said Mo Ke.