The case for sodium-ion

Latitude Media covering the new. of the energy transition. I'm Shale Kahn, and this is Catalyst. We can see pretty clearly for the next two years, cause we have quotes from uh both from raw material suppliers and from cell suppliers, uh that yeah, like the the price is falling by About twenty dollars per kilowatt hour over the next two two-ish years, two to three years. Coming up, watch your blood pressure. We're talking sodium ion.

Catalyst is supported by Fishtank PR, an award-winning PR firm focused on climate and energy tech, renewables, and sustainability. Fishtank is known for generating prominent and effective media coverage for the brands they work with. If you want a PR partner that's thoughtful, shoots straight, and gets results, you'll like Fishtank PR. To learn more about Fishtank's approach, visit fishtankpr.com. That's f I-s-c-h fishtankpr.com.

When utilities need flexible capacity they can count on, they turn to energy hubs. Energy Hub works with more than one hundred and seventy utilities, coordinating over two point five million devices to manage three point four gigawatts of flexibility built for the moments when utilities can't afford uncertainty.

Energy Hub builds and operates virtual power plants that utilities actually stake their grid planning on, coordinating EVs, batteries, thermostats, and more through a single platform built for utility scale, predictive, verifiable, and designed to perform when it counts. Learn more at energyhub.com. I'm Shail Khan. I invest in early stage companies at Energy Impact Partners. Welcome.

All right, so a while back we had our first conversation on this pod about sodium ion batteries, in that case with Adrian Yao from Stanford. Sodium ion has garnered a fair bit of attention as a potential future chemistry that sort of continues the trend we've seen historically within lithium ion from NMC to LFP, which is to say a chemistry with potentially lower capex.

LOWER energy density, but some other characteristics that make it better for certain applications, lower range vehicles, and then particularly for stationary storage on the grid. Sodium, in addition to that, has a bunch of other potential advantages from a very different supply chain that could be more domestic in the US at least.

to potentially drop in manufacturing capability to different safety characteristics. There's a bunch of things that are that are pretty interesting about it in principle that I need to be proven out still in reality. I would say that that conversation that we had with Adrian about sodium ion was fairly sober and I think reflected a fairly steep hill that the chemistry would need to climb in order to compete.

So I thought it'd be worthwhile to present a more bullish view from somebody who's on the ground starting to deploy sodium ion systems. Landon Mossberg is the CEO and co-founder of Peak Energy, which is commercializing sodium ion batteries specifically for stationary energy storage applications. As you can imagine, he's very optimistic about it. So let's see why. I will say this gets pretty wonky. So if you either aren't already in battery chemistry world, don't know about sodium ion,

Um, or just need some of these terms defined, go back to that episode with Adrian Yao. We'll link to it in the show notes, and that'll be a good primer for you. In the meantime, here's Landon. Landon, welcome. Thanks. I'm glad to be here. Let's talk about Sodium Ion. Uh I wanna start with you kind of walking me through from a global perspective, like where we are.

in sodium ion technology, manufacturing, deployment, et cetera. So start with the big picture. Um what how would you characterize like today's state of affairs in sodium ion batteries?

Yeah, it's been an interesting uh an interesting past couple years for sodium ion and for batteries in general. Uh I think, you know, we started peak energy about two years ago and Around that time, the the promise and a lot of the interest going into sodium ion, uh frankly one of the reasons we were interested in it was um it was sort of like, okay, well this is gonna be fundamentally cheaper uh at the the cost of atoms than LFP.

Uh it was I've always described it as like it's a different thing, but People I think generally appreciate the NMC to LFP transition that went on over time, where like LFP fundamentally lower cost, lower energy density. That was a trade that turned out to be worth making in a bunch of contexts, both stationary and

mobile batteries. And so if you think about the promises you're describing it a couple of years ago of sodium ion, it was sort of like an extension of that. It was like, okay, this is the next level, even cheaper fundamentally, potentially Even lower energy density fundamentally, potentially. Now we have to prove one of those things is true.

That's right. Yeah. And by the way, I think that's still like the trajectory that is possible. Whether it like whether that's the ultimate landing spot is is still I think very much dependent on how much traction it gets in different applications and things like that. But it I think you you know, with enough uh with the with similar levels of investment that that L F P saw, you would see a similar you'll see a similar sort of uh uh transition there.

Um but you know, I think two years ago L F P was twice as almost twice as expensive uh as it is today. And and so at that point it just felt like okay, well the The mark to get uh a cheaper uh cell with sodium ion is is easier, right? It's it's uh easier bar to clear. Uh And lo and behold, sort of over you know starting two years ago and really over the next year, the price just kind of fell very, very quickly. Uh um which is a very interesting time to be starting a

uh sodium ion uh based energy storage company. Uh and um I'd love to say we were smart enough to sort of see where we were gonna end up at the application layer, but I I think there is a a good blend of like Being far enough along with the work that we were doing to realize that there were some other application level benefits that still kept this very, very interesting.

uh despite the fact that like the bar had had gotten harder to to meet on or to like beat it on a a full cost of add ons basis. But maybe I'll back up and we can go into those benefits later.

To answer your original question about like where it is right now, um I uh you know, there's somewhere probably between it it's hard to t know exactly because a lot of this capacity is actually existing lithium ion capacity that's that can be repurposed or has been repurposed for sodium ion. Um but I think you you be pretty safe in saying there's at least thirty gigawatt hours, probably as much as a hundred gigawatt hours of uh sodium ion capacity.

worldwide for all different variants. Uh and sodium ion is similar to lithium ion. It's not a monolithic uh cell. You have m uh mostly differentiated by the cathode. Um that's uh that you're using um and we're using uh sodium pyrophosphate in FPP, which uh until very recently didn't get much attention at all outside of China and even in China it was is was the second fiddle to higher energy density layered oxides.

So thirty gigawatt hours to maybe a hundred gigawatt hours of capacity globally, y you made a a good point there that like the numbers are squishy because people can And in some cases have repurposed LFP lines to make sodium ion. So the numbers are not as easy as they are in other cases. But let's assume it's something in that range. Um, I assume ninety-five percent of that, ninety-nine percent of that is in China. How much of that is in China?

Almost all of it's in China. There's there's some s sort of token projects and stuff elsewhere, but almost all of it's in China. Interestingly, that implies that the large Korean uh battery companies like the LGs and SKs and Samsung's are not yet a big players in sodium ion world. Is that true?

Yeah, I think the large Korean players are um you know, they saw the ro they saw the roading writing on the wall with L F P uh a few years ago and decided to go straight at that uh at that. And I think they're pretty they got their hands full with that. That's a really tough thing to try to catch up to the the Chinese uh on that pathway. We're starting to see some interest there. Um

uh from smaller players in Korea but also for some of s from some of the bigger ones. Uh but I think it's gonna be a journey for them. They're they're they're already kind of pot committed on LFP to a large extent and they're gonna have to go through that process.

Okay, so then most of this manufacturing capacity in China. One thing we've learned over the years is that manufacturing capacity does not equate to installations, particularly when it uh when it is in China. Um, what do we know about where if and where these batteries are getting deployed from the Chinese manufacturers.

really depends on the again sort of type of sodium ion you're talking about. But there's uh there seems to be a a decent uh like a large portion of this market's going towards like smaller applications. So think of like twelve volt battery replacement stuff, scooters. Yeah, smaller packs for other kind of scooter like applications. That's interesting because I would think that like energy density matters a lot in a scooter type application. Maybe I'm wrong about that.

I mean I think that uh so you can approach LFP energy density, uh get really close, and even some cases uh there's some claims of matching it with layered oxides. Um now that that's a higher cost than sodium uh you because you have some sort of transition metal in it, right? Like a nickel or or something like that, copper. Um We're not doing that. And uh the the layered oxides are also sort of similar to the layered oxides in uh uh lithium ion world where the like cyclability is not as good.

Um the safety uh profile is is a little tougher to design for and things like that. But they are higher energy to see higher voltages, so that's that's where they play. Right. So but I guess it raises the question like why? So if you're gonna

you know, put a Sony ion battery in a scooter, like what is the benefit that you're seeking there? You're getting maybe the same energy density at a cost that means that you probably aren't getting a cheaper battery, or vice versa, you're getting a cheaper battery that has lower energy density. So what what is the do you know what the I know this is not the application you're going after, but I'm just curious what the thinking is there.

Uh I there are some performance benefits. So sodium ion in general, like again, it's very chemistry specific, but in general you have much higher ionic conductivity, which translates to higher power. Uh so You can get more power out of these things. Um, especially with layered arc oxide architectures, they can have really nice cold weather performance. So

Uh scooters, this can be super interesting. I think some of this is just momentum too, especially in the la layered oxide side. That um, you know, two years ago when they were starting to sign these contracts and stuff like that, LFP was expensive and they could beat the price. Uh now they're probably close to the price of L F P probably not cheaper. Um but uh you know, you these are as you know, like battery projects takes take a while to to get going and these these you design a pack and then

you have to kinda make a guess about where you're gonna end up on the price. Um I you know, there's a we from very early days looked at layered oxide uh and then decided it's it's not the

Not the chemistry at least for the current product set that we're building on the energy storage side. And that's actually I mean I think there there are really interesting applications. C ATL has uh been very vocal about their Their hybrid pack technology where they're using I I think it's a layered oxide uh based sodium ion, but they they basically have some portion of a vehicle pack that is sodium uh for Primarily for power and for cold weather performance and then the rest is L F P. Um

And you've you're also hearing BYD uh uh push out their first sort of sodium ion packs, so I think there's uh there's a broad consensus that this is trending in the direction and we see the same thing. I mean from the quotes and what we're hearing from the suppliers, not just cells, but also materials. We see a really um low risk pathway to the uh the crossover point on price with L F P coming somewhere between twenty twenty eight and twenty thirty out of China.

Um So it like I think that's w like broadly why you're see people investing here because you have these performance benefits on the layered oxide side plus a trajectory to get to that level of cost. Um sodium ions a different or uh energy stores different picture, which is what we're really excited about, but that's where we see the other ones. Right. So then that that leads to

Deployment question on the energy storage side. So for stationary energy storage, are we seeing within China deployments at, you know, what at 100 megawatt scale, 10 megawatt scale, megawatt scale? Like what do we see so far? You saw the first announcements kind of uh late last year, early this year with uh first sort of demonstrator projects and those are in the like tens of megawatt hour scale. Um

And we know there are multiple other in the pipeline. Some of this is driven by some policy in China that that provided projects that that do um non lithium storage. with some uh uh preference in like interconnect Q speed and stuff like that, or the equivalent of whatever the Interconnect Q uh is in China. Um and so you're starting to see that get deployed there. There's also some safety benefits on the NFPP side, which I can talk about.

Where they're like, you know, if you're looking at deploying energy storage for fast charging at gas stations, the safety requirements are really high there. Um so they're having an easier time getting those permitted. Interestingly, I I think Where we see the benefit, uh and where we're really excited about the product trajector trajectory on our first system.

is really on non capex cost. Uh and we don't see a ton of focus on that yet in China. I I expect there will be, uh, as we're getting traction and and they're seeing what we're doing. But Mostly what you're seeing right now is like either some sort of policy driven measures uh or uh things that are that are due to like safety characteristics of the systems that that they're gonna deploying there.

This is a I shouldn't know the answer to this question, but I'll ask it to you anyway. Um I asked you in megawatts, you answered in megawatt hours, and it made me realize I don't actually know. Does uh does cost scale with duration? With sodium ion, similar to how it does with lithium ion. Yes. Yeah, yeah. It's it's and that's you know, that's one of the benefits of the technology in general, right? Like There are a lot of really interesting energy storage

technologies out there that that have promise, but the problem is that they're really, really like they're very different than what is the the mass like the the thing that's gotten adoption, which is lithium-ion-based systems. So if you look at like

flow batteries or compressed air storage or um you know things like that. They're they're just like new and there's a lot of unknown unknowns about how you deploy them at mass scale. For for sodium ion though, like It's so similar it's similar in enough ways to lithium ion that like Operators know how to use it, the risks are largely well understood.

um you know, you can you can uh uh apply a huge amount of the supply chain and scale and and um and de-risking and capital and all those structures against it. So that just means that you can get to scale much, much faster with much less risk. Uh and so if you have a technology that actually fits better, it just means the market's the addressable market i is much immediately larger.

Okay, so if I could step back and just characterize uh how you describe this sort of state of affairs today. There is manufacturing capacity that is at meaningful scale. I mean not compared to to LFP or whatever, but but tens of gigawatt hours, basically all in China. Deployments are starting to happen. It seems more initially in the mobility world than in stationary storage, but they're initially as well. But we're very early innings.

This is just the past year or two this is happening, is that right? No, exactly. And and I think go back a year ago, you you saw when when we were over in China, I mean you heard a little bit about uh N FPP and and um and energy storage for sodium, but it was It was usually like almost everybody was uh doing it as a side project against layered oxide and higher energy density sodium ion.

Uh today we're starting to see that flip. There's increasing interest in N F as an energy storage uh like a really great technology for energy storage and you're seeing even I mean even some of the the uh other applications are getting interested into this because the you know, and we can go into the the benefits, but it's it's got a lot of uh system level uh goodness that that just make

Uh i especially in energy storage, a better product that's that's easier to make and and easier to de-risk, but they probably translate to other spaces as well. So I think we're like we're early innings on sodium ion, but we're even earlier innings uh on the scale up of N F PP and I think we're gonna see a lot, a lot, lot more of that soon.

That sort of gets to my final question on the state of affairs before we go into a deep dive comparison between Sodium Ion and N LFP for grid storage, which is um the supply chain. I mean, people are familiar with sort of supply chain for lithium ion generally. Where do you get the lithium? Where do you get the cathode materials? How where do you do the where do you make CAM or PCAM?

How do you turn it where do you turn it into cells and how and packs and all that? What does that look like in the early days of sodium ion? Is it an entire at least in the initial construct? Is it like an entirely internal China? supply chain. Because I know one thing that's different is that their the resource, the the base resource. Differentiated versus lithium ion?

Yeah. Yeah. So so um I think if you take the bomb uh for lithium ion, you take the bomb for sodium ion with a a a few small com caveats. They are exactly uh well like you can use the exact same supply chain for sodium ion that you can use for lithium ion, except for active material. So cathode active material and anode active material. Obviously salts for for electrolytes.

And then as you get to more specialized architectures, we see a lot of opportunity to to customize stuff like separators and solvents and stuff like that, which we are doing. In general, that's like one of the really nice characteristics of this is that you have a scaled supply chain that you can already draw on for most of the bomb. Uh now for the active materials, um On the uh let's talk about cathode first. Uh for what we're doing is is uh uh NFP and and that's

Um pretty simple. It's it's very similar uh to LFP, uh and uh the the lithium carbonate sort of equivalent for NFPP is sodium, s uh sodium bicarbonate. Uh Um so uh and and you know you can make that synthetically. It's it's like relatively cheap to make synthetically. You can also mine it from Trono Reserves. The US has the world's largest natural, naturally exploitable proven Tron reserves. We have like ninety-two percent of proven cap uh um reserves.

Uh but you can also make it synthetically and a lot of countries do that. So it's really not a constrained resource in the same way that like high quality lithium carbonate sources are. Uh that's not gonna be the thing that drives the um drives any bottlenecks in the pro process. And in fact I think mostly it's it's about getting like processing uh of that up. And I think on that you can uh if you look at the way people cr um make NFP cathodes now, I think layer oxides are gonna be

similar in some ways, but I'm not as as expert on that. Um uh NFPP can can use very, very similar process uh steps as as uh lithium ion cathodes. Uh interestingly you can sort of do Mm. Type uh cathode manufacturing or from uh layered oxide type cathode manufacturing on the uh so you have some choices there and I think there's ongoing optimization around that. That's part of what's gonna continue to drive like cost optimization on the cathode side. Um

Of course, like most of the processing capability for that today is in China. Uh but I think if you talk about the the scale of the challenge to bring up like non-Chinese Supplies of active material, it's much easier for sodium ion because you have much less um incumbent.

scale benefit in China to compete with on that technology. So if we wait for four or five years to get into this game, we're gonna be in a similar place that we are today on LFP. But uh today at least you're not a you're not facing such a huge uh economy of scale challenge. Active materials uh a really interesting thing too, which we can talk about as well if if you're interested in that. But yeah, hard hard carbons on the uh anode active active side.

Are you tired of overpaying for big name PR firms but not really knowing what they're delivering? Is your comms team wasting time reviewing lengthy messaging briefs and decks? Instead of engaging journalists or producing content, are you wondering why your competitors are getting pressed and you aren't? Fishtink PR is an award-winning climate and energy tech, renewables, and sustainability focused PR firm

Dedicated to elevating the work of both early stage and established companies. Whether you need to position yourself as a thought leader in between project announcements or translate complex ideas and technologies into tangible, compelling stories that resonate with the media, Fishtank can help. Check out fishtankpr.com. That's f-i-s-c-h fishtankpr.com.

Virtual power plants are becoming a reliable way for utilities to manage capacity, but enrolling devices is just the start. What really matters is confidence, knowing those resources will perform when dispatched, and being able to prove it. From the control room to the living room, Energy Hub's platform handles the full picture, from near real time forecasting, locational dispatch, and the kind of rigorous verification that holds up when regulators, grid operators, or leadership asks.

Did it deliver? Easy enrollment creates momentum, proven performance builds trust. That's why more than 170 utilities rely on EnergyHub to manage over 2.5 million devices, delivering 3.4 gigawatts of flexible capacity. See what that looks like at energyhub.com.

Okay, so What you're focused on is stationary storage using an FPP, as you said. Um, and I know that your your view is that a an appropriate comparison obviously the thing you need to do to win. is to go take down LFP or at least take down, you know, a chunk of L F P right, to go penetrate that market substantially because that market is dominated by LFP. So I think your view is that an appropriate comparison between sodium ion and an LFP for grid storage purposes.

is a is a holistic view of a bunch of different characteristics. So I what what I kinda wanna do is run through a bunch of different characteristics for you and have you walk me through how you view the comparison between kind of sodium ion, let's say over the next couple of years, not

ten years from now and not today. Um, but what do you see as realistic in the sort of, you know, if somebody's developing a project, if they're d developing a greenfield project today, um, what is that going to look like? And then y you can tell me sort of how these how these stack up against each other. Yeah, happy to do it. And I I think maybe to reframe kind of where the like a little bit about how to think about peak energy. I mean we are building our first

technology on sodium ion. Uh but I would not necessarily think of us as a sodium ion company. Uh we're we're a vertically integrated energy storage company. Uh we want to work from the cell up to the system and pick the best technology there. So it's not necessarily that we want to beat LFP. We wanna just pick the right technology for this application and and if that's we think that's in FPP hard carbon sodium ion right now.

Uh there are some really interesting things that might be interesting to talk about later with L F P high temperature L F P and stuff like that that that we are working on. But we're not dogmatic about L F P versus sodium ion. We just want the right technology there. Good. So that means you'll be less biased in the answers that you'll give me in a moment as we compare the

Um, okay. So I I wanna start with the the sort of obvious one, which is which is Capex. Um Talk me through CapEx and how they compare to each other, I think at the cell level and then at the system level, which is always important not to forget. Yeah, yeah. So so uh and that's where this gets really interesting. So at the cell level, uh it doesn't it doesn't really make any sense.

uh to talk about cost per cell, right? Because what you actually care about is how much energy is in the cell. So toss cost per kilowatt hour is the thing to care about. Um and on a uh Uh right off the bat, NFP, the the primary challenge for the chemistry is that it's less energy dense uh than uh than LFP, substantially less. Uh

It's getting better, but like that gap is is pretty wide. And so the the material inside the cell is dirt cheap. Even though it's substantially less energy dense, you're less uh you you make up a lot of that cost because you you your materials are really cheap, but we're still Today we are um

Uh uh depending on which LFP you're comparing to, the cells that we're working on are somewhere between fifteen to thirty dollars per kilowatt hour more expensive than equivalent LFP on a cost per kilowatt hour basis. Uh and this is like, you know, looking at a uh LFP cell in China that's anywhere between like fifty to sixty dollars per kilowatt hour. Um so that's kind of where it is today. So you got a premium at the cell level, which I think

folks appreciate and and you we can debate till the cows come home whether that premium sustains into the future or not. Um, sort of irrelevant for the conversation right now, but like Yeah, and we can see pretty clearly for the next two years, because we have quotes from uh both from raw material suppliers and from cell suppliers uh that take the yeah, like the the price is falling by about twenty dollars per kilowatt hour over the next uh two two-ish years, two to three years.

Okay, so your view is that that premium arose. Yeah, not entirely. I think we'll still be about a ten dollar per kilowatt hour uh more expensive if you talk like twenty twenty eight. Okay, so then let's talk about the system level because there's I think there's things pushing in both directions here. Right?

On one hand, your lower energy density and lower energy density effectively means more of all the other stuff. It's the same reason that people care about efficiency for solar panels, right? Like the less efficient you are, the only reason you really care is that your balance of system scales up more because you need more Or stop.

Wiring and more steel and more right, all that kind of stuff. Um, but on the other hand, there's also some things in the full system that I think you can spend less on in sodium ion, right?

So walk me through that trade. So like l now it's is probably the the way to explain this is to maybe back up and tell you a little bit about our system because otherwise these traits don't really make sense. But um so so uh in FPP uh hard carbon Has a couple properties that make it really interesting for energy storage. The most important property here is that it is much more comfortable at higher temperatures.

than L F So Um we're talking like like temperatures in in a range between forty five degrees Celsius and sixty degrees Celsius where this this cell is pretty comfortable and show similar degradation performance at those temperatures that LFP does at twenty five degrees C.

This is really important in an energy storage context and it hasn't historically gotten that much attention because mostly in things like vehicles, you don't care about this because it's easy to cool a pack, you have to do that anyway. Uh and uh and what they care more about is cold weather, right? Because the car's off and then it's gonna get cold, right?

So everyone's focused down there. For energy storage though, it's really much more important at at uh at the high end of the range because managing heat becomes one of the hardest things you have to do with these technologies. You're just pushing so much um so much power in and out of the pack. Uh that's one piece. The other is um partially because of lower energy density. So uh th that's part of this to be clear, but partially because of chemistry benefits.

the cell has uh a much easier safety profile to design for. So it it um uh starts to self-heat at a lower temperature than LFP and it gets when it goes into thermal runaway it burns colder uh than LFP. So um much easier to prevent propagation. And then when it does uh start to vent, the gas that the cells vent uh substantially less explosive. So there's less hydrogen in that gas than uh we we see about fifty percent today.

and opportunity to r uh fifty percent less than LFP and opp opportunity to get that even maybe down below a a threshold where you could light it with an open flame, um which is a really interesting property. So Yep.

So just to boil those down then, so what you're saying is where your savings come in here at the system level are one thermal management and two safety. What you need to install in a lithium-ion battery for safety purposes, you should be able to Spend less, at least, have less safety. equipment. Embedded within the system.

Exactly. Exactly. That that and then there's some other other ones like better slightly better RTE, uh m less swelling, things like this. They're just like they all accrue to system

benefits. So that's that's the chemistry, right? Now let me back back up to the system level. How do we use that, right? So it it uh uh a normal LFP system out in the wild um you're uh you basically uh have a bunch of batteries in a container that maybe need to sit in a desert for twenty years and operate and push like enough power to power like hundreds or thousands of homes uh every day out of this this block.

Um and as you're doing that, it generates a lot of heat. You also want to make sure that none of these cells go into thermal runaway and then like explode and that causes a lot of issues, right? So there's a huge amount of design and complexity that go into the system. And if you actually look at what that nets out to is you get uh like thermal management systems where cooling is the most complex complex and expensive part of this.

So just on a CapEx perspective, you you gotta install like fans, coolers, pumps, like uh water cooling in a lot of these cases. There's a ton of material, a ton of like volumetric energy density loss because you're having to put all this stuff in there.

Um and auxiliary power to power all of this stuff is actually becomes really, really significant. So um in a in like a hot region, uh these things use um like you know On the order of about fifty megawatt hour uh for a for given like uh equivalent um unit or like block container of uh energy LFP energy storage per uh per year of energy just to to cool them.

Right. So uh that that's the aux power load and that becomes actually pretty expensive, right? And then all this stuff, like if you think about pumps and uh fans, it's all moving, right? So the moving stuff's the stuff that's gonna break. This thing has to be out in the desert for twenty years and that's what you're gonna have to go maintain. You're having to change filters and

Do regular maintenance. If the thermal management breaks, you probably have to shut the system down. You can't use it for a while, so it hits reliability and drives a ton of costs. So you end up spending a lot on operating and maintenance and on auxiliary power for these things. Uh in addition to the capex cost, right? Um so but back to the capex cost, all these things plus the safety, plus some mechanical stuff you have to do, drive a lot of cost and a lot of energy uh density loss.

And so because uh l I'll I'll sort of uh our system i and what I'm really excited about our system is yeah, it's great that it's a sodium ion system. Uh it's the largest sodium ion system deployed to the grid. Um we actually are uh the first uh three and a half megawatt hour unit of capacity is going into the grid right now and in Denver it's gonna be the largest outside of China. All that's exciting. But what I'm really excited about is that it's the first passively

uh uh completely passive thermal management system uh on the cooling side ever deployed anywhere in the world at grid scale. Um this means like no moving parts at all through the whole system. Uh and we've dramatically simplified uh the aux power system because of this. So we have no external aux power requirements. We've managed to like depopulate a ton of systems. So it's like

A lot of our team come from Tesla and SpaceX. So there's like this philosoph engineering philosophy in there where everyone always says best part is no part, right? And so we've taken that to heart. We try to depopulate a lot of the subsystems that drive cost complexity and energy density loss here. And what that lets us do is actually get to a balance of system cost, despite a serious energy density penalty that is already today

Pretty much on par with where LFP systems are. Um and that's that's massive because we're a three and a half Sorry, is that the balance of systems costs or is that the total installed cost? Total installed cost is still a little bit higher, primarily because we have that sell

Because you have this okay okay. So the way to think about it is you've got right so you've got some portion that's the sell cost, you've got a premium there, you've got up the rest of it that's balanced system, despite the energy penalty or sorry, the energy density penalty, which should drive higher balance. You're saying you can get to basically parity exactly. Exactly.

Pr pretty much there, right? Um yeah, it it's again really depends on the system you're talking about and and all that stuff. But we're with And it's idiosyncratic based on the labor rates in the region and all that. But yeah, high levels. Exactly. Um So so that's CapEx.

Yeah. So we we end up being, you know, um today, uh you know, like it I again, and all this is like on stale scale curves and stuff like that. So our uh but but if you look at like uh equivalence uh conditions we're we're you know with within twenty to thirty dollars per kilowatt hour of a really um of like a a good LFP system from China today uh on a cost basis, which is a a massive achievement given the energy density penalty.

Um and then that's trending, as I said, you know, as the those those sell costs comes d come down, we'll be within you know probably$10 per kilowatt hour by 2028. Uh And that is exciting because

you know, it's yeah, we're still more ex if that's where we stopped, we're like, why do we exist? There's no reason to buy a sodium ion system in the world. But I think the reason that it's exciting is'cause you go to these the the O and M cost portion of this and that's where it really, really gets interesting. Yeah, that was gonna be my next step. So, you know, there's the cell level, the system total capex level, and then there's the lifetime cost of ownership level.

You've already mentioned sort of two pieces here, which is OpEx um in general, the for example, the electricity load driven by the aux power, things like that. Um, and then lifetime and degradation. So talk to me about the the opcs in lifetime portion. Yeah, so so f um it like w what's interesting about this and it it was super surprising to me when I got into this uh this space and we started the company because like at the time uh

And still today I think everybody's focused on the DC block cost, right? That's what like you're trying to get energy density into that, everyone's going higher energy density. Um just trying to drive those those costs down on the CapEx le level. Uh and because in intuitively it seems like that would make sense. It's a battery, how much operating cost should there even be?

But as you pull these numbers apart, uh, especially today, because the cost for the the hardware has come down so much over the last three, four years, um, today, you know, the cost of the hardware is probably only about a third of the total project cost. Uh O and M, so all operating and maintenance, including uh like degradation, uh maintenance, aux power, RTE losses, that is about another third of the total.

Uh uh cost NPV'd at like a 10% discount, right? If you don't take an MPV of it, it's massive. It's like by far the biggest thing. Uh and then the other third is installation commissioning, which is still quite, quite high. But while like the the hardware cost has been massively focused since the beginning of the ESS industry, those other two buckets really haven't gotten much focus. They haven't moved.

uh too much. And what we found is that with our with these systems that we've talked about, uh these improvements um that we've been able to build into this first passive system, we've been able to reduce those Uh by really, really material amounts. So like just on auxpower, we're 50 times, a little bit more than 50 times more efficient.

Uh we use like fifty times less power than an equivalent L FP system. Uh um and then uh uh on maintenance uh w we're like substantially less uh less maintenance. I mean something like ninety Or like almost ninety percent of uh all the components that require m regular maintenance or break in a system, we've just completely removed.

By the way, those are also the things that drive a lot of the safety incidents. So if you look at most causes of fires in ESS, which are still fairly rare, but when they happen, they're usually caused by some some thermal management system or some auxiliary system that's there. We don't have those.

So it's a safety or s system by that. If you if you add all that stuff together, we're at about in a hot region like let's take like Miami or Phoenix, we're at about a seventy-five dollar per kilowatt hour NPV benefit on a TCO basis. versus an equivalent LFP system. NPV benefit on a TCO basis. Okay, I understand. If you're doing like a levelized cost of storage type of calculation. Um

What about lifetime? What about cycle life? Yeah. And also how do how much how certain can we be about cycle life with Sodiumine, given how new it is? Cycle life is not uh actually, cycle life is pretty good. We we we are getting close to I think we're at uh like very close to ten thousand cycles now. Uh um on these on these cells. Uh the the one that I think also for LFP, by the way, I think everybody should worry about this is is calendar life, right? Uh

Where you like, you know, you know, these things have been on test for over a year now, uh, in calendar conditions and we're really stressing them, doing a lot of accelerated life t testing. But These are in cases 20 year systems and also for LFP. You know, this industry is not 20 years old. So there's there's a lot of work you have to do to try to estimate that.

Uh the the good news is that the degradation mechanisms in this chemistry are simpler uh than th they're the same they're like fairly fairly equivalent uh to Uh LFP, there's just less of them. So there's multiple different mechanisms of degradation in all batteries.

In NFP hard hard carbon we have less, like for instance we don't have any graphite, so there's no graphite exfoliation, which is a major issue in LFP chemistries. Uh but we both have SEI dissolution. Um and the way that that happens seems to be very, very similar in both these architectures. So we We feel like the risk there uh of some unknown unknowns popping up is substantially less than if you were going to something that was really novel and new. Um

And to answer your question about like where the data is showing us it we're gonna get to, um we are like this this chemistry is just incredibly stable. Uh so you have very, very little little mechanical stress. Uh you don't have Like you have almost no iron dissolution in the cathode, which is a problem in L F P chemistries. You do have SEI dissolution, but that is a very well understood problem. And it seems like most of the strategies used to stabilize SEI for uh for LFP work also for N FPP.

So we've seen massive improvements in things like first cycle efficiency loss and and overall degradation on SEI like over like the last year and it's continued to get better. The punchline of this is that um the uh the cyclability data that we show that we see is um substantially better. So compared to LFP, if you take like Two cells just cycling equivalent um at uh forty five degrees C. Uh I'm just looking at the data right here that we have.

Um after we got two cells, equivalent cells, same size on test in our lab right now. LFP is at about 26,000 2600 cycles and it's at 80% state of health. Um NFPP is Almost three thousand cycles, uh same cell and we're at ninety five uh ninety four point five uh percent. And like I said, we would seen almost 10,000 cycles um still trending way above eighty percent uh state of health on those things. They just don't seem to really want to move down. Um

So cyclability is one of the principal reasons that this thing is is better. And some of our OpEx savings come from reduced augmentation. But actually what we've done is we've tried to design the system to push uh to sort of like not uh drive it. as much benefit in terms of augmentation because the way customers think about augmentation everyone has like a little bit different of a strategy around that. And some customers really value less of augmentation, others don't. So

Um we see more value in trying to be uh better than LFP in degradation, but not like way, way better. Uh instead we're sort of um taking The system and designing it so that it uses less hawk power, needs less cooling, uh, has less maintenance and that sort of stuff. So we push the cells harder and still have better degradation performance, but it it could even be better if we wanted to cool them the same way, for instance, that LFP does.

All right. So stepping back, I guess, one last time here, I want to talk briefly about geography of manufacturing. Um You know, I think in L F P world, right, we have been very China dominant at the cell level. That's where the big CapEx investment is on the cell. Um, and now we're starting to see LFP manufacturing stood up in the US, at least to some extent, right? We've got we've got LG and Panasonic Tesla and so on.

Coming. What do you think happens with sodium ion? And what's what is your plan, right? Like right now you're buying cells from China because that's where they're produced. Um, are you eventually gonna have to stand up a cell line in assuming you stick with sodium ion in in the US? And what's that gonna look like?

We we're definitely gonna build uh cell manufacturing here, uh in in the States. Uh we're also gonna continue to work with partners all over the world. Uh obviously we have some some good partners in China right now.

Uh we're in the process of of um uh of basically getting the the the the plan of the company is kind of like a multi phase plan, right? Where the first phase is is get the technology in the hand of customers, get them comfortable with the technology so that they'll give us off takes to make uh enough a good bankability case to build the cell factory.

And we've done a like I think we're at the tail end of that part right now. So we'll be coming out in um fairly soon with some some pretty big customer announcements around this. Uh but we see tons of traction. based on these OpEx benefits and better reliability, better safety characteristics that make this thing really great for all existing kind of IPP applications, but also really attractive for data centers who really care about reliability, you know, stuff like that. Um

And on the back of that we have the bank ability to set up the the the factories here uh and invest in the supply chain to to get this going. But you can't do that like it's it's I mean you've had You've you've you've talked a lot on pr prior podcasts about like uh folk financing and all that stuff. It's the same same here, right? Um even though this cell technology is manufactured in a materially similar way to LFP.

uh it still takes some some convincing to the market to show that it's like that it works and it's real and that's that's what we're in the business of doing now. But I think your general challenge in setting up a competitive, long term competitive sodium ion based supply chain is probably less, like we talked a little bit before, uh, than LF L F or any lithium ion, just because you you're competing with a much

n like uh less scaled supply chain, at least on active material. And I think there are some properties of sodium ion that they give you more flexibility in different ways that haven't been fully explored on lithium ion. Uh for instance like the the plating mechanism there maybe like shows a lot of promise for

you know, anode list or cell forming anode or whatever you wanna call it, um type type cell architectures where that's been really challenging for lithium ion. It's not gonna be easy for sodium ion, but looks like it might be easier. uh that could unlock some really interesting products that might be great for automotive and stuff like that and and really changes your manufacturing process. Same thing for things like dry coding, larger cell formats.

So I think it just like, you know, the nice thing about sodium ion is it lets you go ahead and get started at scale with a product that is really competitive out the gate in the right applications. On Uh today, right? You don't have to be in the lab for 10 years. But then it has the promise where you can take it in new directions. and kind of disrupt the the incumbents potentially because the technology allows you to do things down the road that that might not be possible with lithium ion.

All right, Landon, this was super illuminating, really interesting. I'm excited to see some Sony Maya and systems out in the wild that you guys are gonna put out there. Um, but thank you so much for the time. Of course, great talking to you, Show. Landon Mossberg is the CEO and co-founder of Peak Energy. This show is a production of Latitude Media. You can head over to latitudemedia.com for links to today's topics. Latitude is supported by Prelude Ventures.

This episode was produced by Daniel Waldorf, mixing and theme song by Sean Marquan. Stephen Lacey is our executive editor. I'm Shale Kahn, and this is Catalyst.