US sodium-ion battery startups race to challenge China's manufacturing lead

European heatwave boosts early demand as firms eye US supply chain

A small group of US startups is racing to build a domestic sodium-ion battery industry, betting the technology can undercut China’s dominance not only in lithium-ion cells but in the newer sodium-ion chemistry now pouring out of Chinese factories. Workers at one US battery company noticed an uptick in demand this summer as sweltering European homeowners were apparently looking for ways to store cheap off-peak electricity and run air conditioners during peak hours.

San Diego-based Unigrid sells a nine-kilowatt-hour home battery built around sodium-ion cells. “We have requests coming from Spain, France, Germany, The Netherlands,” co-founder and chief executive Darren Tan said. “We’ve shipped the first 100 units and [expect to ship] 1,000 before the end of the year.” Sweltering European homeowners were apparently looking for ways of storing power when it was available from the grid at lower rates and then running air conditioners more cheaply, off the battery, during the worst heat of the day.

Sodium-ion batteries have drawn interest from storage experts because they could end up much cheaper to build and operate than lithium-ion cells, are considered less likely to catch fire, and can operate across a wider temperature range — reportedly down to minus 40 degrees Celsius. But the technology also has trade-offs. Sodium-ion cells are less energy-dense than lithium-ion cells, meaning they must be larger and heavier to deliver the same power. Some companies that spoke to the BBC suggested sodium-ion might reach as low as $30 per kilowatt-hour, though analysts said significantly lower costs could be many years away.

The cost gap to lithium-ion is currently narrow. Last December, lithium iron phosphate (LFP) batteries were trading at about $81 per kilowatt-hour, while Unigrid’s sodium-ion battery was priced at roughly $100 per kilowatt-hour.

The technology has been improving on this front in recent years, but sodium-ion cells are not likely to appear in small, energy-hungry devices such as smartphones. Larger energy storage solutions are where most people expect sodium-ion to dominate. But the best, and safest, sodium-ion battery design remains debated, and more than one US company working in the space has floundered in recent years.

Unigrid’s battery contains chromium-3 in its cathode. Prof Dame Clare Grey of the University of Cambridge, co-founder of battery firm Nyobolt, said that under certain conditions chromium-3 may form chromium-6, a toxic and cancer-causing material. “If you’re going to go for sodium […] and you’re going to sell safety, then don’t start putting elements in that are going to raise red flags,” she said. Ivana Hasa of the University of Warwick, who has no connection to Unigrid, said chromium-3 can form chromium-6 at very high states of charge but that this can be mitigated by how voltage is controlled inside the battery. “Safety tests reported on the cell chemistry are very promising,” she said of Unigrid’s technology.

Tan said concerns about the toxicity of the battery’s materials are “overblown” and emphasized that Unigrid’s battery has passed certification and safety tests for sale in Europe and is currently undergoing evaluations for the US market. Third-party tests have not been able to get the battery to form chromium-6, he said. “We’ve tried very hard to try and produce it, we’ve overcharged it as much as we can… We were unsuccessful in generating chromium-6.” Other manufacturers sidestep chromium entirely, using hard carbon or sodium iron phosphate pyrophosphate (NFPP) cathodes instead.

In general, confidence around sodium-ion batteries’ reliability has increased during the last few years, Grey said, and the technology is now finding its way into grid storage applications.

China currently leads the world in sodium-ion battery manufacturing, and US competitors will have to work hard to keep up. Tan said Unigrid can switch between cell suppliers and might in future source from US producers, though possibly at a different cost. The prize is batteries made in the US with 100% US-sourced materials — unlike lithium-ion, where China dominates both the materials supply chain and manufacturing.

Several companies are scaling up. Peak Energy, based in California and Colorado, announced a partnership with General Motors in June to develop a US sodium-ion supply chain for large-scale grid storage. Peak is also relying on China-sourced cells for its first installations, but president and co-founder Cameron Wiles said the pair hope to help GM launch a US-based production facility in Michigan “by the end of 2028.” Wiles added that “China does not have an insurmountable lead in sodium ion batteries.”

Seattle-based Emerald Battery Labs is developing 12-volt auxiliary batteries for vehicles and is currently supplying commercial fleets in the US, though co-founder and chief executive David Bell declined to share details of the battery design. “We think sodium ion […] is going to make up 80% of the market,” Bell said. Emerald is also relying on China-sourced cells as it develops its initial product. The company’s next goal is to develop new anodes for US-produced sodium-ion cells.

ESS Tech, headquartered in Oregon, is working with Alsym, another US firm that is planning to ship “hundreds” of megawatt-hours’ worth of US-made sodium-ion batteries by 2027. Chief executive Drew Buckley pointed to the boom in electricity demand from data centers, which are also contributing to rising greenhouse gas emissions in the US. Data-center-driven demand is also rising in other places around the world, including the UK. Sodium-ion batteries could help distribute renewable energy to data centers, Buckley said, and should be cheaper to run than lithium-ion alternatives because they are not expected to require as much cooling.

Hasa cautioned that it will be “challenging” for companies to establish mass production of sodium-ion batteries and noted that, while the technology is often touted as much safer than lithium-ion, it does not come with zero fire risk. If firms succeed, they could enable new strategic choices, she said — helping to avoid wastage of renewable electricity and potentially keeping energy costs low. “I’m a strong believer in the technology,” she said.