From utility-scale renewable projects and the electrification of heavy industries to the growing energy demand from data centers, batteries have never been more important.
The global market for sodium-ion batteries, which was valued at less than USD 1 billion dollars in 2024, is expected to grow to nearly USD 29 billion by 2034. Countries like the United States, where energy demand is rising and supply chains have faced a litany of strains in recent years, may be well served by investing in domestic production now. Fortunately, technological advances from battery companies have demonstrated the benefits of sodium-ion batteries; the challenge now is scaling production.
Nearly 10 GWh of new energy storage capacity was installed in the first quarter of 2026, the highest quarterly total in the sector’s history. Energy storage capacity grew 32% year over year, with a total of 610 GWh expected to be installed by 2030.
No battery chemistry can achieve this level of energy storage on its own. While lithium-ion batteries have played, and undoubtedly will continue to play, a large role in energy storage markets, sodium-ion batteries have begun to attract both investment and industry excitement. Much of the innovation in sodium-ion battery development focuses on creating and mass-manufacturing a low-cost, energy-efficient solution for long-duration energy storage. This problem has only become more glaring as electric grids struggle to incorporate distributed energy generation projects while simultaneously seeing interconnection requests from data centers and EV fleet charging.
Darren Tan, CEO of UNIGRID, a San Diego-based sodium-ion battery company, offered a three-word summary of what made sodium-ion batteries an attractive chemistry for energy storage: safety, power, and longevity. As Tan outlined, the ability of their sodium-ion batteries to offer both a long calendar life and a long cycle life (the number of cycles a battery can undergo before degradation) makes the chemistry well-suited for infrastructure applications. Their inherent safety also makes them an attractive option for storage solutions requiring indoor installation, given their limited potential for thermal runaway.
Like many companies in the energy storage space, Tan faced the challenge of scaling production amid the daunting costs of building a battery manufacturing facility. He decided to opt for, as he described it, the Nvidia/Apple model. Generating IP in the West before working with foundries across Asia to scale production. However, he pointed out the inherent risk of IP exposure in the foundry approach. UNIGRID has therefore split their manufacturing IP into multiple steps, so that no single partner can recreate their technology and they can continue to iterate each aspect.
The industry growth potential of sodium-ion batteries was outlined during a conversation with the COO of Massachusetts-based sodium-ion battery company Alsym Energy, Graeme Grant. When asked what made sodium-ion an attractive alternative to lithium, Grant focused on two primary points. Firstly, sodium-ion batteries excel at maintaining stability at high temperatures and offer a lower flammability risk. Secondly, this technology reduces reliance on a lithium-ion battery supply chain dominated by China. However, he later added a third: the lower material cost of sodium carbonate compared to lithium carbonate has proven attractive to potential customers.
When asked to expand on the expected rate of adoption, Grant explained that because sodium cells could be manufactured in lithium-ion plants with minimal retrofitting, both the learning curve and the time to scale could be kept to a minimum. Their partnership with ReBuild Manufacturing in Pennsylvania to scale production and the 8.5 GWh offtake deal with ESS Inc demonstrate strong market interest. Sodium-ion battery technology can also contribute to peak shaving for grid stability, which will be critical as data centers continue to come online.
One of the largest challenges in developing new battery manufacturing is financing the construction of a battery manufacturing facility. This high capital cost can be difficult to overcome, but Mana Battery, a Colorado-based sodium-ion battery manufacturer, has come up with an innovative solution. Having developed an anode-free sodium-ion battery cell, they can reduce material costs by eliminating a historically heavy and expensive component while achieving high energy density across a variety of chemistries. They have partnered with existing battery manufacturers by supplying an enabling liquid-electrolyte component and providing access to anode-free cell IP. They can use existing gigafactories to scale production while developing their own manufacturing base.
Both Mana Battery and Alsym Energy are members of the American Battery Leadership Coalition, which is focused on promoting sodium-ion batteries for security and economic reasons. The United States has vast domestic reserves of sodium but relies on imports, leaving its battery supply chain vulnerable to geopolitical tensions, trade restrictions, and global supply disruptions. Combined with the job opportunity and the expanding AI race, the arguments for localized sodium production are attracting interest across the political spectrum.
It is important to note that not all sodium-ion batteries are the same; in fact, the flexibility of the chemistry opens up a whole new range of potential use-cases. This is best exemplified by the French Sodium-Ion Battery Company Tiamat Energy, which has been developing a battery chemistry spun off from research initiatives and scaled its raw-material processing to over 1,000 kilograms, enabling production batches over 100 megawatt-hours.
During an August call with The Energy Pioneer, Chief Product Officer Asmae El Mejdoubi explained that Tiamat’s battery chemistry is best used for high-power applications, as its power density of between 4 and 5 kilowatts per kilogram is perfect for hybrid automotive systems.
Despite their different chemistry, sodium-ion batteries also appear well suited to data centers, though for a different reason than long-duration backup. Their ability to deliver high-power over short durations makes them useful as a safeguard against power outages, providing data centers with the immediate power needed to keep systems running or bring them back online quickly.
The decision to spotlight the potential of sodium-ion batteries for a ClimateTech series piece came after a July conversation with Bruis van Vlijmen, a venture partner at Transition Ventures who analyzed the chemistry from a market-potential perspective. In a follow-up prior to publication, he provided his industry synopsis.
“Sodium-ion is one of the most exciting spaces in energy right now, with tailwinds across applications from small fire-resistant batteries for defense and robotics, to rapidly deployed and long-lifetime energy storage systems enabling the AI infrastructure and mass-electrification wave.”
He concluded with a note of confidence in the industry’s future.
“The best innovators are applying lessons learned from the successes and failures in lithium-ion, while leveraging the manufacturing infrastructure already built across the world. I predict massive capital allocation from generalist and deeptech funds flowing into sodium-ion tech in the coming years.”
