We hear from a managing director at TDK Ventures, investor in sodium-ion battery energy storage system (BESS) company Peak Energy, about the current state and future potential of the technology, which most agree is on the cusp of large-scale commercialisation.
The firms’ investment managing director Anil Achyuta led its investment in Peak including in its recent US$55 million Series A funding. The firm is looking to deploy grid-scale BESS in the US market with sodium-ion battery cell technology.
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“Lithium-ion will be the bedrock of electrification, but there are fundamental advantages to sodium-ion for energy storage and that’s why we bet on Peak Energy. Four to ten hours of storage is a very large market in grid-scale ESS, and sodium-ion is well-placed for it,” Achyuta said.
System integrator first, with battery cell production planned
Peak Energy will start off by procuring sodium-ion battery cells from other companies and integrating those into grid-scale BESS solutions, with plans to eventually manufacture its own cells. The first project is a 30-50MW system for a utility customer in the US, while a pilot system will also be built at its headquarters in Burlingame, California. These will help it demonstrate its product to then secure gigawatt-scale orders, Achyuta said.
He wasn’t specific on the form factor that the cells would be deployed in. The broader BESS industry, which predominantly uses lithium-ion, is converging to 20-foot ISO containers with 5MWh-plus per unit, though sodium-ion’s lower energy density means it could not achieve that.
“We’re focusing right now on getting our first pilot unit to the customer site, being able to demonstrate that the units are highly reliable and can even be project financed. Those are two key milestones,” said Achyuta. “We have small efforts in augmenting the current technologies and evaluating technologies that will further reduce the cost profile of our systems. That is to get to the kind of cost structure that will get us to our goal of being a US$1-1.5 billion revenue company.”
“We want to get to the market with revenues first. There are some data centre customers but utilities are really number one,” he added.
Buying sodium-ion battery cells at scale
Sodium-ion manufacturing is ramping up first, mainly in China with two major projects covered by Energy-Storage.news, but there are plenty more. As an investor in one of the few companies with large-scale BESS plans using the technology, at least in the West, Achyuta is well-placed to speak on the state of play for sodium-ion today.
“China is putting a lot of effort on sodium because it knows that, atoms to atoms, it will be cheaper than lithium-ion. In the domestic market, there’s also a lot of interest in two- and three-wheeler EVs, which don’t require a lot of energy density. I see tens of gigawatts of manufacturing projects in China,” Achyuta said.
“The competition in the space is getting fierce which is great for Peak Energy as it means multiple options for sourcing from China. Hopefully, we’ll have more options from the US in future too.”
We then asked how much variety there was between different sodium-ion products from China, and how that variation compared with lithium-ion.
“Even within lithium-ion there is a huge difference between products,” said Achyuta. “There is still a huge debate between cylindrical and pouch for example. Different companies have fundamental differences when it comes to processing and manufacturing. As an integrator, you have to choose.”
“There were a lot of different sodium-ion chemistries at play but there is now a convergence to NFPP, (sodium ion phosphate) which is basically analogous to LFP (lithium iron phosphate).”
Advantages and challenges to scaling sodium-ion
As Achyuta said, sodium-ion’s primary advantage over lithium-ion is that the fundamental materials needed for it—’atoms to atoms’—are far cheaper and more plentiful, meaning in the long-term it should definitely mean cheaper systems. But there are still challenges for it to compete, which Achyuta didn’t shy away from discussing in detail.
“The challenge for sodium-ion has always been the energy density and cycle life compared with lithium-ion. We don’t need huge energy density for energy storage applications, but I was worried about the cycle life question for a while,” he said.
“For a while 5,000 cycles was best-in class for sodium-ion, whereas LFP is already close to 15,000. Now we are seeing data for sodium-ion of cycle life of 9,000-10,000, so it’s getting close to meeting the LFP standards. The energy density is getting close to 110Wh per kg, which is really good.”
Similarly to what one European LFP gigafactory company CEO earlier in the year, Achyuta claimed that prices from China for LFP batteries are artificially low right now.
“Clearly LFP is cheaper right now. There is an artificial bubble of over capacity. People are losing money on batteries because they need to get rid of inventory, we’re seeing an average of US$72-75 per kWh for lithium ion. For sodium-ion, we are seeing sub-US$100 prices from the best suppliers. If it can get to US$75 per kWh that will be great, and Peak Energy’s ambition is to get down to US$40-45 per kWh.”
The future for Peak Energy
Achyuta was keen to emphasise that the cells might come from elsewhere but the firm’s software, battery management system (BMS) is all in-house, US made. Its applications could go beyond ten hours’ duration, to 12-15 hours too.
Achyuta had high praise for the company’s management team, which comprises industry veterans from lithium-ion OEMs Northvolt and Enovix, EV and BESS firm Tesla, and home solar company SunPower (though Northvolt and SunPower have been in the headlines for the wrong reasons recently).
